Why import workers when robots will do the work?

By Leith van Onselen

For years the growth lobby has argued that Australia needs to run high levels of immigration in order to alleviate so-called skills shortages and to mitigate an ageing population, despite the Department of Employment showing that Australia’s skills shortage “remains low by historical standards” and Australia’s labour underutilisation rate tracking at high levels:

One factor the immigration boosters continually ignore is the risk that the rise of robotics and artificial intelligence could replace many of today’s jobs, leading to an even larger pool of underemployed and underutilised workers.

Today, Seek’s chief executive, Andrew Bassat, has warned of an “employment crisis” whereby not enough jobs will be created to replace those expected to be lost through the rising use of robotics, especially in areas like mining, hospitality, accommodation and transport. From The Australian:

“My view is that we have enough warning to know that we need to act with urgency to­ ­address this issue and can no longer afford to wait,” Mr Bassat told The Australian.

“Job losses will only accelerate as machines start to be smarter than people, given our brains were seen as the last line of defence. I can’t see new jobs being created in anywhere near the volumes that will make up for the jobs lost. The same examples of new jobs keep being used, like data ­analysts and engineers etc, but I can’t see them being created with anywhere near the volume needed.’’

Mr Bassat also urged policymakers and the media to start a long-term discussion about what we will do if jobs disappear…

In a recent report, consulting giant McKinsey assessed more than 800 jobs to see how robots could replace people.

It found the accommodation and food services sectors were the most ripe for automation, with machines able to perform about 75 per cent of the work in those sectors.

In the resources sector, one of Australia’s biggest employers, it found robots could perform more than 60 per cent of the work…

A similar theme has been picked up over at The ABC:

The fourth industrial revolution is underway and it’s threatening to wipe out nearly half the jobs in Australia.

This latest round is characterised by intelligent robots and machine learning and PricewaterhouseCoopers economist Jeremy Thorpe said it’s going to completely reshape the Australian jobs market.

“Over the next 20 years approximately 44 per cent of Australia’s jobs, that’s more than 5 million jobs, are at risk of being disrupted by technology, whether that’s digitisation or automation,” he said.

Stefan Hajkowicz, who is the principal scientist at the CSIRO, says it’s white collar workers who are about to feel the pain…

“We were the beneficiaries of globalisation and it’s going to be a shock to the system when we see not just the growth temper, we actually see a decline in those sorts of jobs.”

Already, the construction sector is gearing-up, with FastBrick’s Hadrian X bricklaying machine capable of laying up to 1,000 bricks an hour. From The AFR:

Fastbrick is building a commercial version of its robot bricklaying machine, Hadrian X, which will cost about $2 million when it goes into full production in 2019.

The Hadrian X requires little human interaction and works day and night, laying up to 1000 bricks an hour, which is about the output of two human bricklayers for a day…

News of mining and industrial automation has investors flocking in droves into companies looking to increase mine and construction productivity while keeping labour costs and risks low.

Fastbrick’s announcement comes just days after Fortescue Metals announced it hopes to become the first miner to fully automate the majority of its haul-truck fleet.

Fortescue, which operates 56 self-driving trucks at its Solomon mining hub, said on Sunday it would automate the remaining 12 manned haul trucks at Solomon and another 100 trucks at its Chichester mining hub.

Robotic Process Automation and artificial intelligence have been maturing steadily over the past 10 years, with remote control centres, autonomous haulage trucking and rail, drilling and automated blasting systems commonplace throughout Australian businesses.

Clearly, the rise of robotics and automation debunks the claim that Australia needs to import large swathes of skilled workers to overcome an ageing population.

The reality is likely to be the opposite: too many workers chasing too few jobs as robots and artificial intelligence take over. So why, then, is Australia running one of the highest immigration programs in the world, especially given the extreme pressure that it is placing on infrastructure, housing, schools, hospitals and overall livability?

The more sensible policy option is to restrict immigration and instead better utilise the existing workforce and use automation to overcome any loss of workers as the population ages – as has been utilised in Japan (where unemployment is just 3.1%).

In fact, economists at MIT recently found that there is absolutely no relationship between population ageing and economic decline. To the contrary, population ageing seems to have been associated with improvements in GDP per capita, thanks to increased automation:

If anything, countries experiencing more rapid aging have grown more in recent decades… we show that since the early 1990s or 2000s, the periods commonly viewed as the beginning of the adverse effects of aging in much of the advanced world, there is no negative association between aging and lower GDP per capita… on the contrary, the relationship is significantly positive in many specifications.

Again, the last thing that Australia should be doing is running a mass immigration program which, as noted many times by the PC cannot provide a long-term solution to ageing, and places increasing strains on infrastructure, housing and the natural environment.

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