In recent years, there has been a spurt in the use of robots in manufacturing. Analyze the implications of such trends on jobs and employments.
In the era of competition, manufacturing is becoming more and more automated. Though there are apprehensions that automation will lead to fewer employment opportunities, however, that may not be the case always.
As per the United Nations Conference on Trade and Development (UNCTD), in case of nations where robot density is high, have experienced rise, or only a small decline, in the job opportunities in the manufacturing sector. For example, China and Germany, who have high robot density, experienced an increase in the absolute number of manufacturing jobs, while the other hand in case of South Korea, there was a small decline in employment opportunities in manufacturing.
Further, the use of robots has led to the relocation of manufacturing units to countries such as the US, in case of advanced manufacturing sectors, not the sectors which are labor intensive. Therefore it is good from developing nations perspective as they have a large number of labor-intensive manufacturing units.
The automation and use of Robots benefit more to the advanced manufacturing sectors such as automobiles, electronics, and transport equipment. On the other hand, the benefits of automation are limited in case of low-wage labor-intensive sectors such as textiles and apparel, and food and beverages.
As per UNCTAD, despite the hype, the use of industrial robots remains low. The US along with Germany and Japan accounts for 43% robots usage. In Asia Japan, South Korea and China have about 46% of the global share, Japan has the highest number of industrial robots, followed by China, though China’s robotic growth has been very rapid.
Policymakers should emphasize the use of automation, specifically in the sectors where it does not lead to job loss. This will improve productivity and efficiency, therefore will increase employment opportunities.