Friday, September 25, 2015
Rise of the robots in East Asia
By KARL WILSON in Sydney
A prototype robot with two arms, developed by Japanese conglomerate Hitachi, demonstrates its functions at a warehouse in suburban Tokyo, on Aug 25. Japan is the world leader in robotics. Some Japanese companies are moving their manufacturing back to Japan into automated factories. (AFP)
If the data is anything to go by, one in three workers not only in Asia but worldwide will find themselves replaced by new technology and robots within the next 10 years.
A study by Oxford University has estimated that about 47 percent of all jobs in the United States are at risk from technology, many of them in sectors needing high-level skills, wages and education.
The Committee for the Economic Development of Australia (CEDA), a respected think tank, said that more than 5 million jobs — almost 40 percent of the Australian work force — could disappear over the next 10 to 15 years due to technological advancements.
Gartner, the US-based IT research and advisory firm, said advances in technology, especially robotics and drones, could replace one-third of workers worldwide by 2025.
So should Asian governments be concerned?
“Certainly Asia needs to be worried,” said Serguei Netessine, professor of technology and operations management at graduate business school INSEAD in Singapore.
“It needs to be sowing the seeds now. It cannot afford to wait until it is too late,” he told China Daily Asia Weekly.
Education and planning are key to addressing this issue, Netessine said.
He added that Asian governments must start planning the skill sets that will be required for the new economies that technology and robotics will create.
“This will mean planning everything — from what will be taught to the types of universities that will be needed to produce the people who will design, build and program such things as robots and drones,” said Netessine.
“The workplace of tomorrow will be a very, very different place from that which we know today.”
The Economist pointed out that the impact of technology on jobs of the future will be immense.
“From driverless cars to clever household gadgets, innovations that already exist could destroy swathes of jobs that have hitherto been untouched,” the publication said.
It added that the public sector is one obvious target, because of its resistance to “tech-driven reinvention”.
“But the step change in what computers can do will have a powerful effect on middle-class jobs in the private sector too,” it said. And with the advent of big data, “computers are increasingly able to perform complicated tasks more cheaply and effectively than people”.
Leading the world in the field of technology and robotics is Japan.
In July, the Henn-na Hotel — staffed by 80 robots and just 10 humans supervising security and cleaning — opened in Nagasaki.
Companies such as Canon and Honda, which shifted manufacturing offshore years ago, are now moving back to Japan and into fully automated factories with much less human staff.
This shift means low production and labor costs, especially in a country like Japan that is hobbled by an aging population and a growing labor shortage.
Corporate America has been doing much the same alongside other advanced economies.
China, which had been slow to adapt to technological change, is losing no time in catching up with other countries as it moves from a manufacturing-based economy to one built on technology and innovation.
Robotics company Shanghai PT Info, for example, launched a robot in August that can entertain and monitor elderly people.
Like Japan, China also has an aging population. Based on government data, China’s work force peaked in 2011 and has been declining ever since.
Lu Jiehua, professor of sociology at Peking University, said robots offer a relatively simple solution to the problem, a view shared by other senior officials in the country.
Wang Weiming, deputy director of the equipment department at the Ministry of Industry and Information Technology, said the development of the robotics industry will solve the labor shortage in China and reduce labor costs in the manufacturing sector.
At a conference in Orlando, Florida last year, Peter Sondergaard, senior vice-president and head of global research at Gartner, said that smart machines were an emerging “super class of technologies that perform a wide variety of work, both the physical and the intellectual kind”.
“The cognitive capability in software will extend to other areas, including financial analysis, medical diagnostics and data analytic jobs of all sorts,” he said.
“Knowledge work will be automated as will physical jobs with the arrival of smart robots.”
He added that digital businesses require less labor and machines will make sense of data faster than humans can.
Since the Industrial Revolution took off in the 18th century, machines have made many manual jobs redundant while creating new jobs.
The difference today is that technology, robots and artificial intelligence (AI) are also taking over jobs that require “brain power”, said Li Yanfei, an economist with the Economic Research Institute for ASEAN and East Asia (ERIA).
Sondergaard from Gartner cited, for example, that AI programs can now write basic financial reports and sports news reports once done by journalists.
Not all jobs will disappear, though, he said.
“In fact, new jobs are being created all the time — jobs that require sophisticated decision-making, judgment, problem solving and personal interactions.”
Sondergaard listed an array of jobs that robots cannot replace yet, such as those of researchers, engineers, medical professionals and senior care attendants.
“Even in laborious manufacturing, machines cannot replace human beings everywhere … at least not yet.”
This applies, for instance, to the initiative by Apple supplier Foxconn to replace millions of workers in its production lines for the iPhone and iPad with robots.
“Robots, especially affordable ones, cannot mimic human fingers in the nimbleness and dexterity in the assembly of handset devices,” Sondergaard said.
“These devices are so small that the precision required in assembly cannot be reached by these affordable robots. There are high-end ones that could do, but they are too expensive and it is more economical to use human labor.”
Netessine of INSEAD said there is a growing fear in Asia that robots will replace much of the labor-intensive work that is now moving offshore from China.
“Sure, some jobs will go, but others will stay. The apparel sector is a good example of an industry that employs a lot of people.
“But machines are not flexible enough to do something like sewing,” he said, adding he does not see certain jobs going away soon.
Li from ERIA said sectors such as apparel, toy manufacturing, shoes, heavy chemicals and some components of food processing will be able to absorb the uneducated or less-educated segments of the population and provide them with better living standards.
“I don’t think machines and robots will take away these jobs soon, as long as the cost of labor remains low. But these jobs will not make the countries rich,” he said.
“What Asian countries should be thinking about is leapfrogging … in other words, jumping to customized production with design, brand and quality.”
This, Li said, applies to other sectors as well such as tourism, organic food production and healthcare.
“They key here, however, will be attracting high-end manpower and that will require better education.”
Netessine pointed out that rising labor cost is the underlying reason why jobs move offshore.
“Sure, machines have replaced a lot of manual jobs in developed countries such as the US, and now we are seeing it with precision jobs,” he said.
“It is happening fast in the US. In China it will take five to 10 years, but it is happening. Those jobs will move to higher-end sectors. People will need to ‘re-skill’.”
Drones, for example, are expected to replace trucks and delivery vans. But people will still be needed to design, build and program drones, he added.
“Computers, AI, robotics and drones will all create new jobs, new skills,” Netessine said. “As for what will happen in 20 to 40 years, I have no idea.”