When I was a teenager I worked as a waitress for a while. When I wasn’t doing that I was counting quarters in a casino in Miami, working in a bookshop or pulling pints in what was then a relatively low-grade pub on Ledbury Road in west London.
That makes me one of millions. One in eight Americans has at some point worked in McDonald’s and pretty much every member of my generation has experience of waiting tables. That was our introduction to the world of work. But here’s an odd thing: taking orders shouted on a Saturday night might be an experience our children never have. Why? Because those kinds of jobs are being automated.
A few weeks ago McDonald’s announced new technology “to make it easier for customers to order and pay for food digitally and to give people the ability to customise their orders”. Think mobile ordering and self-ordering kiosks. Chili’s Bar & Grill is starting a tablet ordering system and Applebee’s is doing the same in 2,000 of its restaurants.
In China a fully robot-staffed restaurant (yes, they cook too) has been running for a few years. There’ll be no real people left behind any fast food counters in 15 years.
This is partly about cutting the cost of labour. The clamour for higher minimum wages is rising (it has just gone to $15 an hour in San Francisco) and savvy employers know that even without legislation, wages won’t stay static in the west for ever. Wage growth might be sluggish here, but in the US worker compensation was up by an annualised 2.2 per cent in the third quarter.
It’s not just about nasty capitalists trying to avoid paying a living wage: ordering via machine is quicker and better. Robots don’t get sick, get pregnant, ask for more money, argue about repetitive tasks, or fall in love with their co-workers. They might also be better sales people than people. Are you more likely to sign up to a loyalty programme on an iPad in your hand while you wait for an order, or on a form shoved at you by a harassed teenager at the counter?
Nor is it just about restaurants. According to research company Gartner, one in three jobs will be replaced by some kind of software, robot or smart machine by 2025. Visit a factory today and you can see how. I went to a sawmill last year. From the second the logs rolled off the lorry the only human interaction came via a computer control room. They were sized, sorted and cut on orders from a software system. Amazing.
Robots are already cleaning hospitals, vacuuming the houses of people slightly richer than you; picking strawberries in Japan (with a camera that analyses ripeness). But this also isn’t just about boring jobs. Take what you can when you can, said one strategist to me a few days ago when I was wondering whether to write more or not.
“Give it a decade and both our jobs will be being done by a machine.” Far fetched? Not really. Futurist Ray Kurzwell reckons that by 2020, computer processing power will have reached the level of a human brain. Middle-aged bankers might want to look back to their first graduate job: how much of it is automated now? A third? We don’t need junior number crunchers any more.
It’s the same in journalism. I had two assistants when I first started out as an editor. Now I have an iPad. I miss the girls. But there it is.
The same goes for train drivers: I was mildly surprised to see last month that the trains at the Tokyo Disney Resort have no drivers, but run very smoothly. We also don’t need so many cameramen or pilots — aerial footage of everything from war zones to farmland comes from drones. And what of nurses?
If remote devices can monitor patients with heart disease and diabetes and infrared light can guide robots to the right veins to take blood from, we don’t need so many of them either. The same goes for surgeons.
Do we need to worry? A little. This kind of change is very deflationary and our radicalised central bankers can’t cope with that. It’s also bad for people with the wrong skills. If robots can do everything simple, being good at simple things is useless.
But we shouldn’t be hysterical either. Creative and innovative people will do well and there’ll still be plenty of jobs in newish service areas. Think one-on-one full time help for the elderly.
Robopets aside, companionship will remain a human function. So will gardening, fixing old cars, decorating and plumbing. At the same time, with labour costs no longer a big deal, we can expect reshoring to accelerate, which will bring some employment with it.
And all these machines will need designing, building and controlling. Let’s not forget the internet as we know it is only 20-odd years old. Imagine trying to explain to an agricultural labourer in 1930 that his grandchildren would be making 100,000 pounds a year each as computer programmers.
So what should you do? Bring up creative children; give them something to differentiate them from machines. Second, think about investing. Getting into robotics isn’t easy.
But many of the best companies are privately held and clear winners haven’t yet emerged. With that in mind you could look at a newish exchange-traded fund listed in the US — the Global Robotics and Automation Index ETF. It isn’t at all cheap by ETF standards — the ongoing charges are 0.95 per cent but at the moment, there isn’t much competition.
This also seems a good time to point you in the direction of the new Guinness Global Innovators Fund. This is cheaper (an introductory management fee of 0.25 per cent) and invests in companies positioned to benefit from innovation in all areas. It clearly isn’t specifically about automation but it is hard to see how any company wanting to drive growth via innovation these days can do so without using technology.
Finally, a note on communication: not all technology works perfectly and I have had some trouble with my email address. If you have been trying to get in touch with me do please try again.
Financial Times
