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From SCDigest's On-Target E-Magazine

Oct. 26, 2011

Logistics News: Automation In The Workplace Is Inevitable – The Question Is: Are We Smart Enough To Plan For It?

Can We Plan For The Robotic Era, Rather Than Letting It Happen Randomly?


SCDigest Editorial Staff

In January of this year Supply Chain Digest reported that Kroger is moving forward with the development of its new Advantage Checkout System that will automate the checkout process by reducing billions of touches annually. This is a revolutionary approach to Point-of-Sale and retail checkout that involves high speed imaging of bar codes or other identifiers to reduce labor costs and speed shoppers through the checkout process (see – “New Kroger Bar Code Scan Tunnel Could Revolutionize Retail Checkout”).


Eventually, Kroger, Wal-Mart or Target or some other large retailer will be introducing a totally automated inventory management system into their store operations. Every shelf will be fitted with bar codes, RFID tags, or some form of Optical Character Recognition*(OCR) system allowing a mobile pick-and-place robot to find the exact shelf location of every product in the store. Every individual product in the warehouse will also be fitted with a bar code, RFID tag, or OCR, so the robot will be able to pick up and identify every product that it needs to shelve. A relatively simple computer vision system will allow the robot to navigate throughout the store stacking items on the shelves. These inventory management robots will operate 24-hours-a-day shuttling merchandise from the back of the store onto the shelves as items are sold. The robots will also constantly straighten the shelves and re-shelve merchandise. All of the technology needed to do this is nearly in place today.


*Note: OCR is a field of research in pattern recognition, artificial intelligence and computer vision.

SCDigest Says:

Instead of letting the robots happen to us in a highly disruptive way, we should take this opportunity to think about how we want the U.S. economy to work for all of the citizens of the automation age.
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Why This Is Of Critical Importance!


The economy of the United States, as well as all other industrialized countries, is based on jobs. That is to say that, unless you are independently wealthy, you must either own a profitable business, or work for someone who owns a business, in order to “earn a living”. That’s just the way it is in a free, democratic, capitalistic society. You have no choice. You must earn money in order to support your life style. If, for whatever reason, you cannot work the odds are that you will eventually be dependent on entitlements, charity, and government provided welfare programs.


This makes jobs key to the health, prosperity, and security of the country and its citizens. That is why every U.S. President is focused on jobs and job creation. The U.S. workforce is already the most productive in the world. But, we have just scratched the surface. We are just now entering an era where the number of jobs, (blue collar, white collar, no collar, and service related) in our economy will be drastically reduced by automation. No presidential speech or act of Congress is going to change that.


Robots have been replacing automotive manufacturing and assembly line workers for a few decades now. More recently, voice recognition systems have replaced telephone operators; ATMs have replaced bank tellers; and, computerized kiosks have replaced grocery checkout clerks, gas station attendants, and the list goes on and on. Even the military is adopting automation technology like the Predator Drones to wage war while reducing collateral damage and risk to its own personnel.

As a result, the marketplace is rapidly becoming dominated by automation technology. While we do enjoy the many convinces this technology provides in our daily lives, we sometimes wonder (as President Obama did in a speech he gave in June of this year) - where have all the people gone that use to do these jobs?


This isn't exactly a new phenomenon - businesses relentlessly looking for ways to replace workers with automation in order to lower cost and increase productivity. It's been going on for centuries. But, this century will experience accelerated adoption of automation technologies at a rate never seen before.


(Distribution/Materials Handling Story Continues Below )


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Will Future Advances In Automation Create New Higher Level Jobs?


As is always the case – the development and deployment of new technology creates new jobs for some while eliminating existing jobs for others. For example, consider the retail store automation described at the beginning of this article:

Analysis, concepting, and programming will be done by highly specialized engineers.

Design, manufacturing, and assembly will be done by computers and robots.
Field installation of the automated equipment and processes will be performed by skilled technicians.
Operating and servicing the automated systems will require some human intervention, while maintaining and repairing robots will most likely be done by other robots.
Customer interface with the system will be through a combination of voice and touch screen technology. Human assistance will be limited and available on an as needed basis only.

Despite losing millions of jobs to automation technology over the past 50 years, even in this current deep and prolonged recession we have more total jobs than we did when the steel and auto and telephone and food industries had a lot more workers and a lot less automation. Somehow, new jobs get created to replace the old ones. However, the problem is that the thousands of jobs created by providers of automation will not offset the millions of production and service jobs lost to automation.


In the past, technology has not had this effect. For example, before there were backhoes there were men with shovels. A backhoe replaced a hundred men with shovels. But new businesses and factories sprang up to manufacture the backhoes, and those companies hired people - many of them former ditch diggers. All of these new businesses and factories tended to employ many of the workers displaced by technology. The economy generally absorbed every unemployed worker in the new businesses that were created by advances in technology. Today, new jobs are being created, but not at the usual pace, and not fast enough to soak up the unemployed.


But it’s wrong to blame technology for today’s loss of jobs. The bigger problem currently is housing, where hundreds of thousands of workers have lost their jobs. The source of that problem isn't technology but an over-reaching housing policy and distorted financing practices. The solution is relatively easy (albeit politically charged) - let the housing market clear, let interest rates rise, stop subsidizing mortgages, and clean up the foreclosure mess. That would let housing starts return to something like normal and the problem is solved.



Understanding Future Job Creation Issues


Aside from all of the politics associated with current job creation - the hard truth about the U.S. economy today and going forward is that businesses don’t need as many of us as workers, but, still need us as consumers. The American economy depends on a healthy base of consumers spending their money. As we experienced in the Great Depression, and now in the Great Recession, massive across the board unemployment causes a sharp downward spiral that hurts the entire economy.


We are standing right now on the threshold of the robotic era. Once autonomous robots start arriving in the job market in significant numbers (something that we will see happening by the end of this decade) they have the potential to dramatically change the global economy.


The guesstimated size of the U.S. labor pool is 150 million give or take a few million. The U.S. economy seems to run smoothly when unemployment is 5% or less. A 10% rate of unemployment produces the current situation. So there is not much leeway (7 to 8 million jobs) between relatively good times and relatively terrible times. With consumer spending accounting for two-thirds of economic activity, anything that spooks consumers (who have jobs) into losing confidence in their future prospects fuels the downward spiral.


The issues are profound. How do we prevent this downward spiral from happening? Are we smart enough to see the automation revolution that is coming and plan for it prior to the crisis? Can we redesign the economy so that we enter the new era of autonomous robots smoothly? With robots doing most of the work, can we actually create a society that takes advantage of the leisure time that automation can provide? Or, will the millions of people displaced by automation end up being homeless and destitute, living in government provided dormitories?



Final Thoughts


The nation’s current economic health depends on elected politicians who are willing to take the political risks necessary to balance the budget, rein in health care and retirement costs, revamp our failing public education system, eliminate job destroying regulations, and standup to the fact that taxes cannot be raised without cuts in spending.


While these current issues are complex they are just the tip of the iceberg. It is time to start rethinking our economic system and understand how we will allow people to live their lives in an automation driven nation. Instead of letting the robots happen to us in a highly disruptive way, we should take this opportunity to think about how we want the U.S. economy to work for all of the citizens of the automation age. The time to be doing that is now.


Editor’s note: We want to credit Marshall Brain ( ), who is the author of Robotic Nation 2015, for his perspectives on this important subject, a few of which have been included in this article.


What's your take on this story on Automation In The Workplace Is Inevitable? Let us know your thoughts at the Feedback button below.

Recent Feedback

Aside from Marshall Brain, there's also a guy named Martin Ford whose book proposes a greatly expanded welfare system to get money into the hands of consumers. There's a large volume of literature on the subject and I'd encourage anyone interested to read some of it.

Mr. Dalleo
Computer Scientist
George Mason University
Nov, 29 2011