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OM in the News: Who is Winning the Race for Jobs Between Robots and Humans?

March 30, 2017

Robot arms weld a vehicle at the GM plant in Lansing, Mich.

“Who is winning the race for jobs between robots and humans,” asks The New York Times (March 29, 2017). Two leading economists have just declared a winner: the robots. The industry most affected by automation is manufacturing. For every robot per thousand workers, 6.2 workers lost their jobs and wages fell by as much as 3/4 of a percent, according to the MIT and BU researchers. Theirs is the first study to quantify large, direct, negative effects of robots. The profs said they were surprised to see very little employment increase in other occupations to offset the job losses in manufacturing.

The study analyzed the effect of industrial robots in local labor markets in the U.S. Robots are to blame for up to 670,000 lost manufacturing jobs between 1990 and 2007, it concluded, and that number will rise because industrial robots are expected to quadruple. The findings fuel the debate about whether technology will help people do their jobs more efficiently and create new ones, as it has in the past, or eventually displace humans. The problem might be that the new jobs created by technology are not in the places that are losing jobs, like the Rust Belt.

In addition to cars, industrial robots are used most in the manufacturing of electronics, metal products, plastics and chemicals. They do not require humans to operate, and do various tasks like welding, painting and packaging. From 1993 to 2007, the U.S. added one new industrial robot for every thousand workers — mostly in the Midwest, South and East — and Western Europe added 1.6.

The next question is whether the coming wave of technologies — like machine learning, drones and driverless cars — will have similar effects, but on many more people.

Classroom discussion questions:

  1. Other research has predicted that humans will come out ahead in the job battle. Why do you think this is the case?

      2. Is the robot revolution a good OM trend?

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