The new automation revolution is going to disrupt both industry and services, and developing countries need to rethink their development strategies.
A NEWS item caught my eye last week, that Uber has obtained permission in California to test two driverless cars, with human drivers inside to make corrections in case something goes wrong.
Presumably, if the tests go well, Uber will roll out a fleet of cars without drivers in that state. It is already doing that in other states in America.
In Malaysia, some cars can already do automatic parking. Is it a matter of time before Uber, taxis and personal vehicles will all be smart enough to bring us from A to B without our having to do anything ourselves?
But in this application of “artificial intelligence”, in which machines can have human cognitive functions built into them, what will happen to the taxi drivers? The owners of taxis and Uber may make more money but their drivers will most likely lose their jobs.
The driverless car is just one example of the technological revolution taking place that is going to drastically transform the world of work and living.
There is concern that the march of automation tied with digital technology will cause dislocation in many factories and offices, and eventually lead to mass unemployment.
This concern is becoming so pervasive that none other than Bill Gates recently proposed that companies using robots should have to pay taxes on the incomes attributed to the use of robotics, similar to the income tax that employees have to pay.
That proposal has caused an uproar, with mainstream economists like Lawrence Summers, a former United States treasury secretary, condemning it for putting brakes on technological advancement. One of them suggested that the first company to pay taxes for causing automation should be Microsoft.
However, the tax on robots idea is one response to growing fears that the automation revolution will cause uncontrollable disruption and increase the inequalities and job insecurities that have already spurred social and political upheaval in the West, leading to the anti-establishment votes for Brexit and Donald Trump.
Recent studies are showing that deepening use of automation will cause widespread disruption in many sectors and even whole economies. Worse, it is the developing countries that are estimated to lose the most, and this will exacerbate the already great global inequalities.
The risks of job automation to developing countries is estimated to range from 55 to 85%, according to a pioneering study in 2016 by Oxford University’s Martin School and Citi.
Major emerging economies will be at high risk, including China (77%) and India (69%). The risk for Malaysia is estimated at 65-70%. The developed OECD countries’ average risk is only 57%.
From the Oxford-Citi report, “The future is not what it used to be”, one gathers there are at least three reasons why the automation revolution will be particularly disruptive in developing countries.
First, there is “premature deindustrialisation” taking place as manufacturing is becoming less labour-intensive and many developing countries have reached the peak of their manufacturing jobs.
Second, recent developments in robotics and additive manufacturing will enable and could thus lead to relocation of foreign firms back to their home countries.
Seventy per cent of clients surveyed believe automation and 3D printing developments will encourage international companies to move their manufacturing close to home. China, Asean and Latin America have the most to lose from this relocation.
by MARTIN KHOR
Read more @ http://www.thestar.com.my/opinion/columnists/global-trends/2017/03/13/here-come-the-robots-your-job-is-at-risk-the-new-automation-revolution-is-going-to-disrupt-both-indu/#WoK9d2HArzsvWYHy.99