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OM in the News: Japan’s Robot Revolution

December 23, 2016

A withering factory town in Japan is looking for revival through a dose of Prime Minister Abe’s “robot revolution.” Kadoma’s population has declined 13% as the nation ages, prompting mergers among schools and emergency services departments. Factories can’t find enough people to run assembly lines, further threatening an industrial base that includes titan Panasonic and smaller businesses like Izumo, a maker of industrial rubber.

Yet Izumo’s CEO doesn’t believe the solution involves finding more people. He’d rather find more machines to do the work so his company can capitalize on Abe’s plan to quadruple Japan’s robotics sector into a $20 billion industry by 2020. “We want to create a mass-production system run by robots and tap into the global market,” he said.

robot-data“The open embrace of robots in Japan is in stark contrast to the U.S., where automation is seen as yet another threat to working class-jobs in manufacturing,” writes New Equipment Digest (Dec. 22, 2016). It also reflects Japan’s aversion to immigration, and a hope that machines can keep its factories competitive vs. rivals like China with lower labor costs. Abe has urged companies to distribute the machines into “every corner of our economy and society” — including the manufacturing, health-care and service industries. Japan aims to double the market for manufacturing robotics by 2020, while increasing the service robots market 20-fold. The development and deployment of robots — and the software to control them — is expected to save 5.7 million Japanese jobs through 2031. Robots also could shave 25% off factory labor costs in Japan.

Japan also could export its robot revolution to China, which has made robotics a focus of its industrial policy and is the world’s biggest buyer of the machines. China wants to employ 150 robots for every 10,000 factory workers — triple the current ratio.

Classroom discussion questions:

  1. Discuss the U.S. move to increase factory jobs in this context?
  2. How does Japan differ from other developed countries?

 

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