The new technology revolution

Japan, China, Singapore, Thailand and even India are automating industry at speed

By C. R. de Silva

Current global developments

Revolutionary changes in technology, following on the heels of globalisation, are changing the world economy as a result of the evolving changes in employment and resulting wage patterns in the industrialised economies. 

The overriding structural issues facing the advanced economies are creeping job insecurity and the need for providing productive employment and adequate salaries for affected workers to take care of their families, in the wake of progressive use of robots and also ‘Artificial Intelligence’ (AI). 

These problems are occurring in diverse sectors of industrialised economies, with a wave of robotic machines and automation replacing millions of factory workers, accountants, drivers of commercial vehicles, as well as office clerks performing routine tasks, whose employment rationale is beginning to fracture and eventually disappear.

To demonstrate the enormity of the problem, described by some as the “automation bomb” already afflicting the industrialised economies, McKinsey & Co, the well-known consulting firm, has reported that while only 5% of existing jobs have been entirely automated at present in the US, 60% of employment could progressively be replaced with machines, able to do a good part of that work. 

This report also estimated that some 800 different occupations could be affected by such automation, the largest proportion being in manufacturing industry, in food services and in the hospitality sector, as well as in retailing consumer products – where online sales have already carved out a substantial chunk of business earlier transacted in small shops and department stores.

These employment trends are spreading worldwide and are not confined to the US alone. The deployment of robots per 10,000 workers is actually higher at present in Japan, Germany and even China (which enjoys cheaper labour availability), with ‹middle-skilled› workers doing more routine tasks, including clerks, book-keepers and assembly-line labour in manufacturing industries, being substituted first by robots; but automation with the use of ‹intelligent› or thinking machines is creeping up the skills ladder, to include data crunching and hitherto difficult to automate non-routine jobs. 

Automation-related issues

Implications of these advancing trends for developing economies like Sri Lanka are even more critically important given the dire necessity of productive employment in less affluent and poorer communities populating such countries. Several issues arise for policy consideration in the wake of these developments in the next stage of the ongoing technology revolution, which began with the popularisation of computers which shook the world in the 1980s, and progressed with the digital revolution and the spread of smart phones in recent years.

Firstly, what innovations in automation are evolving in the job market which will impact on traditional, mostly routine, employment?

Secondly, how will this coming change in employment patterns resulting from automation, be managed in a way which protects affected workers› livelihood, and generate maximum benefits for them and for society at large?

Thirdly, how will developing economies like Sri Lanka maintain a pricing and quality advantage in exports to conventional markets, comparative to robot-produced goods in those countries of potential export, even in Asia, at competitive cost, reducing or eliminating the low cost labour differential;

And lastly, what changes of emphases in Government policies will be needed countrywide, principally to reorient education and vocational training sector curricula, to prepare the work-force for prospective worldwide changes caused by automation, which are already a reality in the industrialised countries, especially if the low cost labour-based competitive advantage may be lost? Japan, China, Singapore, Thailand, even India are automating industry at speed, as seen later in this essay.

Robotics – Innovations in automation

Robots are not just replacing their human counterparts in the industrialised economies, but according to Martin Ford in ‹Rise of the Robots›, these manufactured devices are now soldering, painting, screwing and gluing parts together and even building new machine parts, displaying amazing productivity and staying power in industrial establishments, in many diverse countries. 

Oxford University research has estimated that 47% of jobs in the US could be automated within the next 20 years, ushering in a radically new economic paradigm and opening the potential for an all-out worker revolt, if public and private sector policies do not evolve to guarantee incomes, so people can look after their families. Ford believes that computers, robots, and ‹thinking› machines using algorithms, will become competent to perform routine, repetitive and predictable tasks, which will prove susceptible to automation over time.

Sceptics of the above scary scenario have soon come to realise that from the time of the Industrial Revolution, the world economy has always historically adapted over time - in agriculture, mechanisation has led to greater productivity and higher incomes, and workers have transitioned to employment in other sectors. 

Resulting from heavy investment in research in the West, unaided domestic robots are now available which vacuum, scrub and mop floors and even clean gutters. A self-driving (automated) car, aided by numerous sensors and tracking technology, has been developed over many years now, completed 700,000 accident-free miles in California, and is now in limited commercial production at fairly affordable cost by Tesla. In July 2016 in Dallas, Texas, a military-style robot was sent in by the local police to successfully shoot an elusive sniper, who was killing policemen during a daytime confrontation.

In Japan, given the rapid ageing of society, a domestic robot has been in use for over 10 years to provide company to the elderly or housebound, engage in basic conversation, prompt in taking timely medications, and even summon emergency services. Despite heavy Government investment in Japan in this respect, mechanical alternatives have not commonly replaced human nursing yet, because high cost is still a constraint. 

Honda has «reached the pinnacle of humanoid robotics» so far achieved, and developed an advanced robot which can run, hop, jump, talk and otherwise interact with people, but its transition to domestic use is still in the future. Martin Casserly in ‹The PC Advisor› related these developments more than two years ago, and referred to a school in Birmingham, U.K. where a diminutive robot is helping to teach children with learning disabilities. 

These developments in robotics, as they become financially viable, are worrisome news to unskilled workers everywhere, working in factories and packaging plants, who can be replaced at nearly half the cost, to perform twice the amount of labour. Only the jobs of skilled supervisors may remain. In addition to industrial sector jobs, it will not be long before robots deployed in the food industry stack supermarket shelves, and interact with shoppers. At a US Consumer Electronics Show in 2016, a ‹FutureRobot› was demonstrated who could talk to shoppers, find them information by touching a screen, and enable goods to be ordered and paid for through a credit card slot.

In fact, Amazon, the well-known online worldwide retailer, is already using robots to do the hard labour involved in assisting employees in packaging and sending out deliveries far quicker than earlier in its huge warehouses in the US. Productivity is estimated to have increased threefold. And in addition, Amazon is awaiting US Government approval to deploy flying, automated drones to deliver the packages over long distances to customers, which will put the postal and courier services out of business. It is clear that just like in globalisation, there will be winners and losers, which is natural in every walk of life, and Asian economies will not be spared the impact of this global phenomenon.

The Pentagon (Defence Ministry) in the US is running a competition among robotics companies to design and build machines capable of navigating treacherous terrain during times of disasters, like floods, earthquakes or fires, and using equipment to locate survivors and transport them to safety. In this respect, the ‹Atlas› robot has already demonstrated its capability to work in such rescue situations, eliminating the need for human beings to risk their lives, just as how bomb disposal robots fit the bill now. However, the downside is that, given the Defence Ministry origin of financing, the temptation to use robots like ‹Atlas› in combat situations, and other military applications, will be hard to resist, displaying the potential demerits of coming robotic supremacy (PCAdvisor/6June2014). 

Artificial Intelligence (AI) – Now ‘Thinking Machine’ Age is here

The Nobel Prize winner in Behavioural Economics Dr. Daniel Kahneman, author of ‹Thinking Fast and Slow›, believes that robots will actually replace CEOs in due time, which is well beyond the limits of manual or physical labour. His view is that there is no concrete evidence that expert human cognition does better than intelligently constructed formulae, meaning algorithms conjoined with Artificial Intelligence (AI) to create good business judgement. 

So, what is AI? It is the invention and deployment to actual situations of intelligent or ‹thinking› machines, which can complete cognitive tasks as distinguished from accomplishing purely physical ones, which robots could do, as demonstrated earlier.

Now, these automated digital machines have started to demonstrate broad abilities in pattern recognition, complex communication, and similar domains that previously used to be exclusively human. Automated machines using a technique called «deep learning» are already being used to power internet search engines, block spam e-mails, suggest e-mail replies, translate web pages, recognise voice commands, detect credit card fraud and even steer automated cars. Instead of people writing software for computer application, now there is data writing software unaided! «Deep Learning» is the ability of a computer to automatically refine its methods, and improve its results as it gets more data. 

Experts in this field see AI do more and more, and as deep learning techniques progress and are perfected, their costs will stabilise and then decrease, expected outcomes will improve, and human lives will prosper. AI will progress from trivial (recognising faces in photos and proposing products), to substantive (fully automated cars, supervising robots in work places, and even matching jobs with suitable applicants), to life changing (giving key aspects of eyesight to the visually impaired, who number 20 million in the US alone, at the cost of a good hearing aid, (introduced in Israel already in 2013). The Food & Drug Administration in the US has recently approved a retinal implant/chip which is expected to bring sight back to the completely blind; and similar implants will restore hearing to the deaf. Quadriplegics can now manage wheelchairs by AI-assisted brain control.

IBM›s inventions are augmenting doctors› clinical expertise, not replacing them, to better diagnose disease, matching medical information against patients› symptoms, medical histories and laboratory results, leading to better sickness diagnoses and treatment plans. After a thinking robot won Jeopardy! (an American quiz show) on TV against human contestants, IBM built Dr. Watson with the help of leading US medical clinics to perform the tasks mentioned earlier! So, the development of thinking machines is not only revolutionary but close to a miracle, improving human livelihoods – and still at its inception, but progress will be rapid from year to year.

A 2016 Special Report on ‹Artificial Intelligence› in The Economist, from which this writer has liberally borrowed some of the foregoing data, has stated that AI has «suddenly become the hottest field in technology». Technology giants are on a buying spree of AI start-up companies, for a total cost of $ 8.5 billion in 2015, and are competing to attract the best research talent from universities in the West. The technique of deep learning using vast quantities of computing power and training data, has been boosted tremendously by the rise of the internet which has made billions of documents, images and videos available for training purposes. 

Professor Jerry Kaplan of Stanford, a University in the very forefront of AI advancement and all cutting-edge technology, forecasts in his book ‹Humans Need Not Apply›, the coming upheaval in the labour market, while in ‹Rise of the Robots›, Martin Ford warns of a threatened jobless future, since most jobs can be broken down into a series of routine tasks, more and more amenable to machine performance. So, these trends are what John Maynard Keynes, the celebrated British economist predicted as early as the 1930s in coining the term «technological unemployment» – the leapfrogging of technological efficiency faster than we can resolve the problem of labour absorption, given increasingly large numbers entering the labour force.  

(To be continued.)

(The writer was a member of the former C.C.S. who was later a senior professional at World Bank headquarters for over 30 years.)