top of page
  • Writer's pictureEdwin and George

A World Without Work? Not Yet

EGM On A Mission: Let’s Build Better Companies

‘The story I tell is that machines won't do everything in the future – but they’ll do more. And as they slowly, but relentlessly, take on more and more tasks, humans will be forced to retreat to an ever-shrinking set of activities - there’s no reason to believe there will be enough demand to employ all those who are able to do the remaining work.’ (1)

Boy cries wolf.

Pandemic accelerates automation?

The fears of a jobless future are overblown. At least for now. (2)

Nevertheless, there are some great recent examples of automation:

  • Pittsburgh international airport has become the first to employ ultra violet robots for cleaning duties. Mobile units strolling around airport lounges searching for rubbish and dirt. The implications for industrial and domestic cleaning could be profound. (Not sue how the dog will react to a robot wandering around the house – probably end up behind the sofa). (3)

  • An Ohio fast food chain (Lee’s Famous Recipe Chicken) is using machines to take orders at their drive throughs – advising customers on choices and spotting upsell opportunities (American accent - ‘would you like to try our home-made apple pie today?’). (4)

  • Circle K, a US supermarket, has introduced technology (Amazon Go) to remove cashiers and standing in lines - take an item from the shelf and your account is automatically debited. Put an item back you get a credit (5)

Many commentators expect the pandemic to speed up the pace of automation – eliminating jobs – particularly for those with less marketable skills.

Economists have confidentially claimed that a wave of job killing robots are sweeping the labour market. The IMF says ’the pandemic is hastening a reduction in employment for those sectors vulnerable to automation.’ (6)
  • The incentives to automate is high in recessions. Workers becomes relatively more expensive – as revenues (but not wages) decline

  • Human contact brings risks – retail, hospitality, travel, leisure – all more likely to be automated

  • Robots don’t need to socially distance or quarantine - they rarely get sick

  • Companies have cash in the bank to automate and drive production costs down (often due to government handouts during the pandemic).

The US economy has returned to pre-pandemic output levels - with 7 million workers less – something has happened to increase productivity. Is this a sign of increased automation? (7)

Yet doom mongers struggle to provide real evidence that the pandemic has caused more automation and widespread job losses – in fact, the evidence points the other way:

Companies are screaming out about a lack of people – it’s unlikely pandemic induced automation is creating an army of surplus workers. Labour shortages are getting worse.

‘Australia has special circumstances impacting the number of workers.

‘The decision to shut borders is causing problems – with worsening skill shortages that are raising costs and denting output. The agriculture and mining sectors are hugely affected. BHP and Rio Tinto recently issued warnings about labour shortages – estimating they could be 40,000 workers short in the next two years - threatening the performance of companies that contribute A$48bn to the economy. (8)

But labour shortages, post pandemic, are also common in other countries:

  • In the US - job placement site Indeed estimate there were a record 9.8 million job openings as of mid-July. (9)

  • In Canada, unfilled job vacancies are up by 20% from pre-pandemic levels

  • ‘The Economist’ reports that ‘even in Europe, slow out of the post-lockdown gates, a growing number of companies are complaining how hard it is to get staff.’ (10)

And there are other reasons that cast doubt on the argument that increased automation is causing job losses:

  • Imports of robots and artificial intelligence software by the US fell by 3% in 2020 (the second year running there has been a decline)

  • A survey by Gartner in September 2020 found that spending on automation slowed in developed countries over the previous twelve months

  • Sales by Rockwell, one of the largest producers of industrial automation software, declined by 5% in 2020

  • A survey by UBS at the start of 2021 found little growing interest in automation in large European companies.

  • The proportion of US jobs consisting of a high amount of routine tasks (and more likely to be automated) actually rose in 2021. (11)

Research by McKinsey has regularly finds that companies have a desire to automate their processes and customer interactions. (12)

But perhaps the concern of further waves of the pandemic is delaying projects – investment tends to be low when uncertainty is high.

And it’s more difficult automating with remote working.

Choosing which processes to automate demands a thorough understanding of how the business operates. Even in the pre-pandemic world this was hard – and that’s when people were working together in offices. It becomes even harder if communication is over a video link.

Restrictions on international travel don’t help.

And then there’s the overriding question - even if automation is increasing, do machines destroy or create jobs?

  • On the one hand – machines are labour saving and this means unemployment.

  • On the other - the cheaper it is to produce something, the more demand there will be – and the bigger the economic pie - meaning more workers will be employed. (13)

‘If a pandemic induced wave of job killing robots doesn’t happen, it will be just one more misplaced fear of machines. History is littered with similar stories. In 1928, for example, ‘The New York Times’ proclaimed that the ‘march of machines will make idle hands’ - such fears were never realized.’ (14)

It’s early days to assess the impact of the pandemic - and this time might be different.

However, it’s wise to hold off from fretting about the future of work – given the history of failed predictions, it’s hard to take the worst forecasts too seriously.

  1. A world without work, Daniel Susskind

  2. Robots threaten jobs less than fearmongers claim, The Economist, 10 April 2021




  6. Is the pandemic accelerating automation? The Economist, 19th June 2021

  7. Financial Times, 31 August 2021

  8. Business counts the costs of worker shortages in Australia,, 20 July 2021

  9. The great resignation, EGM blog

  10. Is the pandemic accelerating automation? The Economist, 19th June 2021

  11. Robots threaten jobs less than fear mongers claim, The Economist, 10 April 2021

  12. See for example, the automation imperative, 7 September 2021

  13. A world without work, Daniel Susskind

  14. Robots threaten jobs less than fear mongers claim, The Economist, 10 April 2021

331 views0 comments


bottom of page