Do we need humans for this job? Automation explodes after COVID-19

Ask for a roast beef sandwich at an Arby drive-thru in east Los Angeles and you might just talk to Tori, an artificially intelligent voice assistant who will take your order and send it to the line cooks.

“That doesn’t call sick,” said Amir Siddiqi, whose family installed the AI ​​voice in his Arby’s franchise this year in Ontario, California. “There is no corona. And its reliability is excellent.

The pandemic not only threatened the health of Americans when it hit the United States in 2020 – it may also have posed a long-term threat to many of their jobs. Faced with labor shortages and higher labor costs, companies are starting to automate service sector jobs that economists once considered secure, assuming machines couldn’t easily provide the human touch that they thought customers would demand.

Past experience suggests that such waves of automation end up creating more jobs than they destroy, but also disproportionately wipe out the less skilled jobs that many low-income workers depend on. The resulting growth difficulties for the US economy could be serious.

Without the pandemic, Siddiqi probably wouldn’t have bothered to invest in new technology that could alienate existing employees and some customers. But everything went well, he said, “Basically there are fewer people needed, but these people are now working in the kitchen and other areas. “

Ideally, automation can redeploy workers to better and more interesting work, provided they can get the appropriate technical training, says Johannes Moenius, an economist at the University of Redlands. But while it’s happening now, it’s not moving fast enough, he says.

Worse yet, a whole class of service jobs created when manufacturing began to deploy more automation may now be at risk. “Robots have escaped the manufacturing sector and entered the much larger service sector,” he said. “I considered the contact jobs to be safe. I was completely taken by surprise.

Improvements in robot technology allow machines to perform many tasks that previously required people – throwing pizza dough, transporting hospital linens, inspecting gauges, sorting goods. The pandemic has accelerated their adoption. Robots, after all, cannot get sick or spread disease. They also don’t ask for time off to deal with unforeseen childcare emergencies.

Economists at the International Monetary Fund have found that past pandemics have encouraged companies to invest in machinery in ways that increase productivity – but also kill low-skilled jobs. “Our results suggest that concerns about the rise of robots amid the COVID-19 pandemic appear justified,” they wrote in a January article.

The consequences could weigh most heavily on less educated women who disproportionately occupy the low- and middle-wage jobs most vulnerable to automation – and viral infections. These jobs include salespeople, administrative assistants, cashiers and helpers in hospitals and those who care for the sick and the elderly.

Employers seem eager to bring in the machines. A survey last year by the nonprofit World Economic Forum found that 43% of companies were planning to downsize due to new technologies. Since the second quarter of 2020, business investment in equipment has increased by 26%, more than twice as fast as the overall economy.

The fastest growth is expected in mobile machines that clean floors in supermarkets, hospitals and warehouses, according to the International Federation of Robotics, a professional group. The same group also expects an increase in sales of robots that provide information to shoppers or deliver room service orders to hotels.

Restaurants have been among the most visible robot adopters. In late August, for example, salad chain Sweetgreen announced it was buying kitchen robotics startup Spyce, which makes a machine that prepares vegetables and grains and puts them in bowls.

It’s not just bots, either – AI-based software and services are on the rise as well. Starbucks automates the behind-the-scenes work of tracking a store’s inventory. More and more stores are going to self-service checkout.

Scott Lawton, CEO of Arlington, Va.-Based restaurant chain Bartaco, struggled last fall to bring waiters back to his restaurants when they reopened during the pandemic.

So he decided to do without them. With the help of a software company, his company developed an online ordering and payment system that customers could use on their phones. Diners now simply scan a barcode in the center of each table to access a menu and order their food without waiting for a waiter. Workers bring food and drink to their tables. And when they’re done eating, customers pay over the phone and leave.

Innovation has reduced the number of employees, but workers are not necessarily worse off. Each Bartaco site – there are 21 – now has up to eight deputy directors, about double the total before the pandemic. Many are former waiters, and they roam the tables to make sure everyone has what they need. They receive annual salaries starting at $ 55,000 rather than hourly wages.

Tips are now shared among all other employees, including dishwashers, who now typically earn $ 20 an hour or more – far more than their pre-pandemic wages. “We don’t have the labor shortages you read on the news,” Lawton said.

The rise in automation hasn’t blocked an astonishing rebound in the US labor market – at least so far.

The US economy lost 22.4 million jobs in March and April 2020 when the pandemic wind hit the United States. openings and complain that they cannot find enough workers.

Behind the hiring boom lies an increase in spending by consumers, many of whom have weathered the crisis in surprisingly good financial condition – thanks both to federal relief checks and, in many cases, to the savings accumulated by working. at home and skipping daily commutes.

For now, the short-term benefits of the economic recovery outweigh the job losses due to automation, the effects of which tend to manifest gradually over a period of years. It may not last. Last year, researchers at the University of Zurich and the University of British Columbia found that the so-called jobless recoveries of the past 35 years, in which economic output rebounded from recessions faster than employment, could be explained by the loss of jobs vulnerable to automation. .

Despite heavy hiring since the middle of last year, the US economy is still short of 5.3 million jobs compared to what it had in February 2020. And Lydia Boussour, chief US economist at Oxford Economics , calculated in August that 40% of missing jobs are vulnerable. automation, especially those in food preparation, retail and manufacturing.

Some economists fear automation may push workers into lower-paying positions. Daron Acemoglu, an economist at the Massachusetts Institute of Technology, and Pascual Restrepo of Boston University estimated in June that up to 70% of the stagnation of wages in the United States between 1980 and 2016 could be explained by replacement machines. humans performing routine tasks.

“A lot of automated jobs were in the middle of the skill allocation,” Acemoglu said. “They no longer exist and the workers who executed them are now in less skilled jobs. “

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