Robots, artificial intelligence and automation have been widely associated with fears about economic disruption and mass unemployment, but evidence and research suggest these concerns may be misplaced. Today, attention is increasingly focused on cobots, collaborative robots that do not replace employees so much as work alongside them. ​

ANALYSIS

 

ANALYSIS

Hand in hand

Hand in hand

When workers at a Tennessee manufacturing firm were asked to name a pair of robots that were being installed, they opted for “Thelma and Louise” – a sardonic reference to the iconic film that ends with the protagonists driving off a cliff. But staff at SFEG, which makes electrical motors, are not unusual in fearing that robots kill jobs. 

A host of prestigious research institutes and scholars have long made bleak predictions about the impact of the next phase of automation on the jobs market. A recent report by the McKinsey Global Institute, for example, forecasts that up to 800 million jobs could be lost to robots by 2030. A third of the workforce in wealthier nations could need to find new jobs, researchers warned. And Carl Benedikt Frey, of Oxford University’s Oxford Martin School, has grabbed headlines with his warning that close to half of US and a third of UK jobs will be threatened by technology.  

Productivity boost

But the prospect of mass job losses has been called into question by a growing number of firms, which have started to embrace robots, particularly a new generation of collaborative robots, or “cobots”, designed to work hand-in-hand with humans. 

While progress in robotics and artificial intelligence (AI) will almost certainly lead to significant change, it also has the potential to boost productivity, increase wages and even improve job quality.

Today, a range of businesses from manufacturing to design are finding new ways to pair humans and robots in ways that actually increase employment.

“People are not on Earth to work in stupid or repetitive jobs,” says Helmut Schmid, general manager, Western Europe, at Universal Robots. “Our robots were developed to take over the most monotonous, boring and unhealthy tasks – the kind that most people don’t want to do if they have any choice.” 

Meet the cobot

Founded in 2005, the Denmark-based company pioneered the cobot eight years ago. The market is still in its infancy, accounting for around five per cent of overall robotics demand, but it is the fastest-growing segment of the industry, with sales increasing by close to 50 per cent a year, against seven per cent for robotics as a whole. The surge in demand partly reflects affordability. At between €60,000 to €80,000 each, cobots are within the reach of even modestly-sized firms, which can typically recover the cost within six to nine months.  

Cobots tend to need less oversight, too. While traditional industrial robots can be dangerous and fast-moving, often requiring caging, cobots can work safely alongside humans. And they are relatively easy to programme, so companies do not need to hire expensive robotics experts to get them up and running.  

Robots, artificial intelligence and automation have been widely associated with fears about economic disruption and mass unemployment, but evidence and research suggest these concerns may be misplaced. Today, attention is increasingly focused on cobots, collaborative robots that do not replace employees so much as work alongside them. ​

When workers at a Tennessee manufacturing firm were asked to name a pair of robots that were being installed, they opted for “Thelma and Louise” – a sardonic reference to the iconic film that ends with the protagonists driving off a cliff. But staff at SFEG, which makes electrical motors, are not unusual in fearing that robots kill jobs. 

A host of prestigious research institutes and scholars have long made bleak predictions about the impact of the next phase of automation on the jobs market. A recent report by the McKinsey Global Institute, for example, forecasts that up to 800 million jobs could be lost to robots by 2030. A third of the workforce in wealthier nations could need to find new jobs, researchers warned. And Carl Benedikt Frey, of Oxford University’s Oxford Martin School, has grabbed headlines with his warning that close to half of US and a third of UK jobs will be threatened by technology.  

The cobot market is the fastest-growing segment of the industry, with sales increasing by close to 50 per cent a year, versus seven per cent for robotics as 
a whole”​

More job creation 

“Cobots have the potential to significantly increase a firm’s output by accelerating menial tasks, such as packaging, labelling, assembly and feeding other machines with components,” says Samuel Bouchard, chief executive and co-founder of Robotiq, a Canadian firm that makes specialised grippers and cameras for robotic arms. “Rising output and productivity tend to lead to more job creation rather than less for our clients,” he adds.

This claim appears to be borne out by the experience of both large and small companies. German firm beyerdynamic, which makes high-end audio equipment, says the initial addition of two cobots resulted in a 50 per cent productivity boost on its production line. It has since bought more.

“Instead of cutting back on staff, we have been hiring more,” says Peter Härtel, head of process management. “We also have better worker morale, since employees are doing fewer tedious tasks. And quality has improved. There is a feeling that humans and robots work well together and are not in competition.” 

Teams work

At the larger end of the corporate spectrum, researchers from Massachusetts Institute of Technology, working with German carmaker BMW, found that robot-human teams were about 85 per cent more productive than either alone. 

The potential for collaborative technology is being explored in the service industry, too. H. James Wilson, managing director of  information technology and business research at Accenture Research, believes that AI, like cobots, will more often augment and complement human capabilities than replace them. 

AI can bring speed, scalability and quantitative capacity, allowing humans to focus on strengths such as leadership, teamwork, creativity and social skills. In a Harvard Business Review article, Wilson cites the example of software group Autodesk’s Dreamcatcher AI, which helps to design products. 

A designer provides Dreamcatcher with parameters for a potential product, such as a chair able to support up to 20 stone and costing less than $75. The designer adds similar models that he or she deems attractive and Dreamcatcher generates thousands of options, each of which fits the given criteria. The designer can then refine the process, informing the programme of likes and dislikes along the way.

Exaggerated claims 

According to Rob Atkinson, founder and president of the Information Technology and Innovation Foundation, past experience supports the notion that companies and workers can benefit from periods of accelerated automation. 

 “The damage to jobs from technological progress has been exaggerated on most occasions, ever since Luddites broke the new textile machinery in the early 19th Century,” he says. “Projections of doom almost always ignore the secondary effects of automation – output rises, prices go down and that releases greater spending power, which generates more employment. Moreover, new technology invariably generates new jobs that weren’t previously imagined.” 

Research from the Economic Policy Institute (EPI) backs up this thesis. In a paper by Lawrence Mishel and Josh Bivens, The Zombie Robot Argument Lurches On, the EPI concludes that indicators of automation are “positively correlated or neutral with regard to employment”. In the US, for example, a period of faster automation in the late 1990s and early 2000s was associated with the strongest wage growth in a generation. 

Good timing

By contrast, a lull in automation between 1973 and 1995 marked a period of stagnating wages. 

Dr Darrell West, a scholar at The Brookings Institution and author of The Future of Work: Robots, AI, and Automation, believes the rising use of cobots comes at an opportune moment for companies and workers, especially in high-wage nations such as Germany and the UK. 

Figures from the Organisation for Economic Co-operation and Development (OECD) show productivity growth slowing from about 1.7 per cent a year between 2001 and 2007 to just 0.7 per cent between 2010 and 2016. Based on the experience of beyerdynamic and other companies, cobots can potentially reverse this trend, helping high-wage nations to compete with lower-cost rivals. “Robotics are making it more viable to ‘re-shore’ production from low-wage nations to developed nations,” says West.

Deploying cobots can also help smaller companies to flourish in competition with larger rivals. “Cobots have been ‘democratizing’ automation,” says Bouchard. “Because they are less costly, they are accessible to more modestly-sized ventures. In fact, most of our clients are small and medium-sized firms.” 

Keep it simple

Cobots may even narrow the growing performance gap between top-tier companies and others. A recent OECD report revealed that the most productive five per cent of manufacturers had increased productivity by 33 per cent between 2001 and 2013, while other companies had managed an improvement of just 

seven per cent. “It is not quite clear why this gulf has opened up,” says Atkinson. “But wider access to automation, such as cobots and collaborative AI, could well help laggards catch up. The next generation of winners and losers may be determined at least in part by the ability to adopt new technologies.”

Meanwhile, cobot makers continue to refine their products to make their devices even more user-friendly. “The next generation of cobots will be even easier to operate and assemble,” says Schmid. “The process is already manageable for small firms, but there is still room for improvement. We want it to be no more complex than assembling a simple piece of Ikea furniture.” Software interfaces can become even more intuitive for people to use, adds Bouchard. “We want to do for industrial robotics what Apple and Microsoft did for computing interfaces.” 

As prices drift lower, cobots could eventually become part of the household, helping with tasks such as cleaning, laundry and cooking. “The spread of cobots to the home is a relatively distant goal,” says Bouchard. “But long before this happens, I suspect that ever more people will stop looking at robots as potential enemies to human welfare and come to appreciate how well humans and robots can work hand in hand.” 

Back to articles

Instead of cutting back on staff, we have been hiring more. We also have better worker morale. There is a feeling that humans and robots work well together”​

Projections of doom almost always ignore the secondary effects of automation – output rises, prices go down and that releases greater spending power, which generates more employment”​

Researchers from Massachusetts Institute of Technology, working with German carmaker BMW, found that robot-human teams were about 85 per cent more productive than either alone”​

Cobots have been ‘democratising’ automation. Because they are less costly, they are accessible to more modestly-sized ventures”​

Productivity boost

But the prospect of mass job losses has been called into question by a growing number of firms, which have started to embrace robots, particularly a new generation of collaborative robots, or “cobots”, designed to work hand-in-hand with humans. 

While progress in robotics and artificial intelligence (AI) will almost certainly lead to significant change, it also has the potential to boost productivity, increase wages and even improve job quality.

Today, a range of businesses from manufacturing to design are finding new ways to pair humans and robots in ways that actually increase employment.

“People are not on Earth to work in stupid or repetitive jobs,” says Helmut Schmid, general manager, Western Europe, at Universal Robots. “Our robots were developed to take over the most monotonous, boring and unhealthy tasks – the kind that most people don’t want to do if they have any choice.” 

Meet the cobot

Founded in 2005, the Denmark-based company pioneered the cobot eight years ago. The market is still in its infancy, accounting for around five per cent of overall robotics demand, but it is the fastest-growing segment of the industry, with sales increasing by close to 50 per cent a year, against seven per cent for robotics as a whole. The surge in demand partly reflects affordability. At between €60,000 to €80,000 each, cobots are within the reach of even modestly-sized firms, which can typically recover the cost within six to nine months.  

Cobots tend to need less oversight, too. While traditional industrial robots can be dangerous and fast-moving, often requiring caging, cobots can work safely alongside humans. And they are relatively easy to programme, so companies do not need to hire expensive robotics experts to get them up and running.  

The cobot market is the fastest-growing segment of the industry, with sales increasing by close to 50 per cent a year, versus seven per cent for robotics as a whole”​

More job creation 

“Cobots have the potential to significantly increase a firm’s output by accelerating menial tasks, such as packaging, labelling, assembly and feeding other machines with components,” says Samuel Bouchard, chief executive and co-founder of Robotiq, a Canadian firm that makes specialised grippers and cameras for robotic arms. “Rising output and productivity tend to lead to more job creation rather than less for our clients,” he adds.

This claim appears to be borne out by the experience of both large and small companies. German firm beyerdynamic, which makes high-end audio equipment, says the initial addition of two cobots resulted in a 50 per cent productivity boost on its production line. It has since bought more.

“Instead of cutting back on staff, we have been hiring more,” says Peter Härtel, head of process management. “We also have better worker morale, since employees are doing fewer tedious tasks. And quality has improved. There is a feeling that humans and robots work well together and are not in competition.” 

Teams work

At the larger end of the corporate spectrum, researchers from Massachusetts Institute of Technology, working with German carmaker BMW, found that robot-human teams were about 85 per cent more productive than either alone. 

The potential for collaborative technology is being explored in the service industry, too. H. James Wilson, managing director of  information technology and business research at Accenture Research, believes that AI, like cobots, will more often augment and complement human capabilities than replace them. 

AI can bring speed, scalability and quantitative capacity, allowing humans to focus on strengths such as leadership, teamwork, creativity and social skills. In a Harvard Business Review article, Wilson cites the example of software group Autodesk’s Dreamcatcher AI, which helps to design products. 

A designer provides Dreamcatcher with parameters for a potential product, such as a chair able to support up to 20 stone and costing less than $75. The designer adds similar models that he or she deems attractive and Dreamcatcher generates thousands of options, each of which fits the given criteria. The designer can then refine the process, informing the programme of likes and dislikes along the way.

Exaggerated claims 

According to Rob Atkinson, founder and president of the Information Technology and Innovation Foundation, past experience supports the notion that companies and workers can benefit from periods of accelerated automation. 

 “The damage to jobs from technological progress has been exaggerated on most occasions, ever since Luddites broke the new textile machinery in the early 19th Century,” he says. “Projections of doom almost always ignore the secondary effects of automation – output rises, prices go down and that releases greater spending power, which generates more employment. Moreover, new technology invariably generates new jobs that weren’t previously imagined.” 

Research from the Economic Policy Institute (EPI) backs up this thesis. In a paper by Lawrence Mishel and Josh Bivens, The Zombie Robot Argument Lurches On, the EPI concludes that indicators of automation are “positively correlated or neutral with regard to employment”. In the US, for example, a period of faster automation in the late 1990s and early 2000s was associated with the strongest wage growth in a generation. 

Researchers from Massachusetts Institute of Technology, working with German carmaker BMW, found that robot-human teams were about 85 per cent more productive than either alone”​​

Good timing

By contrast, a lull in automation between 1973 and 1995 marked a period of stagnating wages. 

Dr Darrell West, a scholar at The Brookings Institution and author of The Future of Work: Robots, AI, and Automation, believes the rising use of cobots comes at an opportune moment for companies and workers, especially in high-wage nations such as Germany and the UK. 

Figures from the Organisation for Economic Co-operation and Development (OECD) show productivity growth slowing from about 1.7 per cent a year between 2001 and 2007 to just 0.7 per cent between 2010 and 2016. Based on the experience of beyerdynamic and other companies, cobots can potentially reverse this trend, helping high-wage nations to compete with lower-cost rivals. “Robotics are making it more viable to ‘re-shore’ production from low-wage nations to developed nations,” says West.

Deploying cobots can also help smaller companies to flourish in competition with larger rivals. “Cobots have been ‘democratizing’ automation,” says Bouchard. “Because they are less costly, they are accessible to more modestly-sized ventures. In fact, most of our clients are small and medium-sized firms.” 

Cobots have been ‘democratising’ automation. Because they are less costly, they are accessible to more modestly-sized ventures”​​

Instead of cutting back on staff, we have been hiring more. We also have better worker morale. There is a feeling that humans and robots work well together”​​

Keep it simple

Cobots may even narrow the growing performance gap between top-tier companies and others. A recent OECD report revealed that the most productive five per cent of manufacturers had increased productivity by 33 per cent between 2001 and 2013, while other companies had managed an improvement of just 

seven per cent. “It is not quite clear why this gulf has opened up,” says Atkinson. “But wider access to automation, such as cobots and collaborative AI, could well help laggards catch up. The next generation of winners and losers may be determined at least in part by the ability to adopt new technologies.”

Meanwhile, cobot makers continue to refine their products to make their devices even more user-friendly. “The next generation of cobots will be even easier to operate and assemble,” says Schmid. “The process is already manageable for small firms, but there is still room for improvement. We want it to be no more complex than assembling a simple piece of Ikea furniture.” Software interfaces can become even more intuitive for people to use, adds Bouchard. “We want to do for industrial robotics what Apple and Microsoft did for computing interfaces.” 

As prices drift lower, cobots could eventually become part of the household, helping with tasks such as cleaning, laundry and cooking. “The spread of cobots to the home is a relatively distant goal,” says Bouchard. “But long before this happens, I suspect that ever more people will stop looking at robots as potential enemies to human welfare and come to appreciate how well humans and robots can work hand in hand.” 

Back to articles

Projections of doom almost always ignore the secondary effects of automation – output rises, prices go down and that releases greater spending power, which generates more employment”​

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Bridgepoint  |  The Point  |  November 2018  |  Issue 34