Supply Chain by the Numbers for Week of March 31, 2016

Supply Chain by the Numbers

- March 31, 2016 -

New Transport Mode - Blimps? More Warnings about the Impact of Robots on Jobs; Wage Increases in Japan Remain Near Zero Despite Desparate Hopes for Inflation; Parcel Drone Finally Takes Flight in US



12
That's how many hybrid airships - blimps - a UK company called Straightline Aviation has agreed to buy from Lockheed Martin….for moving freight. The company plans to use the massive blimps to run air cargo operations for oil-and-gas companies, transporting their equipment and commodities to and from remote locations. Many see airships as an attractive mode for carrying huge loads over long distances to hard-to-reach destinations, from Alaska to Africa. Each ship will be 80 feet long , be able to travel about 90 miles per hour, and be able to carry 47,000 pounds of cargo. In addition to reaching remote destinations, the blimps will offer a low cost alternative for moving payloads that are not especially time sensitive. Plans already exist for an even larger airship that could carry nearly 200,000 pounds of cargo. A German company called Cargolifter AG was launched in 1996 with a similar idea, but went bust in 2002. The new blimp designs, however, are said to be less expensive to operate and more flexible.

$20.00

That's the mark of hourly pay below which almost all US jobs are likely going to be "automated into obsolescence." That according to a cheery new report recently released by the Federal government. "In other words, the so-called Fourth Industrial Revolution has found its first victims: blue-collar workers and the poor," the Los Angeles Times warned in an editorial this week. The piece notes that corporations and investors are spending billions on such automation — at least $8.5 billion last year on artificial intelligence, and $1.8 billion on robots, numbers of course headed still higher. Why? "Simply put, robots and computers don't need healthcare, pensions, vacation days or even salaries," the LA Times added. As we've noted here earlier this year, a report from the 2016 World Economic Forum calculated that these technological changes likely will destroy 7.1 million jobs around the world by 2020, with only 2.1 million replaced from new jobs in robotics and elsewhere. How will this play out for society? Who knows. Scary.



.5
That's about how many miles a drone flew in what is being called the first federally-sanctioned drone delivery in a US urban area without the help of a human to manually steer it. The delivery was executed on March 10 the Reno, NV area by drone startup Flirtey, which just announced the success this week. Flirtey programmed the drone's flight path using GPS and then loaded a parcel of emergency supplies - including food, water, and a first-aid kit - into a box tethered to one of the company's drones. The drone then flew to an uninhabited house, where it eventually lowered the package to the home's front porch using a rope while hovering above. "We think the safest way to deliver packages is for the drone to remain at a distance and lower it into the customer's hand," Flirtey's CEO said. Current FAA rules require the drone to be within eyesight of the operator at all times, among other major restrictions.



$13
That's about how much wages for Toyota workers in Japan will rise this year, after conclusion of the annual Spring time negotiating season in the country known as Shunto. Many in government and beyond were hoping for a much higher increase, as Japan desperately tries to stoke inflation back up after two decades of almost nonexistent price increases and sometimes deflation. "What is needed is a jump-start to a wage-price spiral of the sort feared from the 1970s", one economist noted. Japanese prime minister Shinzo Abe has said he was hoping for overall wage increases of as much as 10%, but alas it appears on average wages will rise only a meager 0.3% this year, down from an only slightly better 0.69% seen on average in 2015. That despite a very low unemployment rate in the country of just 3.2%. Japan badly needs inflation in part to get the economy going, in part to help it reduce the impact of its huge government debt load.