I am a traveler, a polyglot, a foodie, an engineer, a techie, a mentor, a supply chain innovator, a patent holder and an activist. Moved to the US in the mid 90’s and spent most of my time since in and around Silicon Valley. I am active within various civil society groups that promote inter-faith dialog, diaspora engagement and sustainable development.
Random Archive

Automation and the future of work, a conversation starter

May 14, 2018
0 notes

Posted to LinkedIn on October 5, 2015

Stumbled on this fascinating article over the weekend and it deals with a topic that’s been on my mind for a long time. Everybody from anxious graduates to business leaders like Musk and Gates are thinking of the impact of increased automation on the demand for human labor. As a supply chain practitioner, every visit to a factory is an opportunity to think of ways to automate and reduce errors. But one can’t avoid thinking of the impact of machines on the economic well being of low skilled labor. The confluence of increasing automation and growing human population seem to be setting us for some major social upheaval unless we figure out a way (as we seem to have always done) to create new job categories.

In the paper referenced above and titled: “Why Are There Still So Many Jobs? The History and Future of Workplace Automation,” the author argues that automation has accelerated what he termed ‘occupational polarization’ and has mostly encroached on middle-skill jobs (e.g. sales; office and administrative support; production, craft and repair; and operator, fabricator, and laborer.) Low level service occupations and high level jobs seem to have been rather immune to automation as they rely, with various degrees, on a set of skills such as sensorimotor skills, physical flexibility, common sense, judgment, intuition, creativity, and spoken language are capabilities that are particularly difficult to automate or teach a robot. The author refers to this difficulty as the Polanyi’s Paradox named after the economist, philosopher, and chemist who observed in 1966, “We know more than we can tell”

“We know more than we can tell” (Polanyi’s Paradox)  

What does this mean for the future economic prospects of people and nations?

A look at the Lewis Turning Point can provide some basis for any prognostication. Lewis argued in a 1954 paper that a developing country with “surplus” agricultural labor could grow its industrial sector for years without wage inflation as it absorbs that surplus.

image

I think we can posit that combining Lewis theory with increasing automation could lead to a number of observations:

  • Outsourcing could be disrupted with automation - Poor nations with low skilled labor force are in trouble as the typical shift of low skilled jobs from developing nations might not occur as expected as many of those jobs could replaced by automation instead of being outsourced to less developed nations
  • Investing in education is a strategic imperative - jobs that require intuition, judgment and flexibility are likely to remain difficult to take over by machines and as such continuing education and training are of critical importance to a nation’s competitiveness and social prosperity
  • Occupational polarization requires new taxation models - if automation is leading to societies with two groups on opposite ends of the income spectrum, we have to think of ways to avoid societies with only rich and poor with robots in the middle. Valorizing service jobs that require a human touch or intuition can go a long way in ensuring social cohesiveness.
Supply chain manufacturing outsourcing future of work economics polanyi
May 5, 2018
0 notes

“My grandfather once told me that there were two kinds of people: those who do the work and those who take the credit. He told me to try to be in the first group; there was much less competition.”

Indira Ghandi