Chris Anstey
Robot Revolution
Use of automation for mundane tasks has been under way for generations. But the pandemic as well as subsequent labor shortages and rising wages are pushing U.S. businesses to turn to robots like never before.
Some one-third of firms confronting difficulties in hiring are implementing or exploring automation to replace workers, a recent Federal Reserve survey of chief financial officers found.
The latest round of quarterly earnings has shown executives from a range of businesses confirming the trend, Alex Tanzi reports.
- “People want to remove labor,” says Ametek Inc. Chief Executive Officer David A. Zapico. Ametek’s business making automation equipment for industrial firms — like motion trackers used in steel and lumber mills and packaging systems — is “firing on all cylinders,” he says.
- Domino’s Pizza Inc. is “putting in place equipment and technology that reduce the amount of labor that is required to produce our dough balls,” says CEO Ritch Allison.
- “Tight labor supply” at Hormel Foods Corp. has seen the maker of Spam spread and Skippy peanut butter “ramping up our investments in automation,” Mark Coffey, a group vice president says.
With the latest monthly employment report showing sustained large wage gains, there’s a cost consideration too. Average hourly earnings rose 4.9% in October from a year ago, the most since February and much higher than the 2.7% average over the five years through 2019.
Knightscope makes security robots that look a bit like R2-D2 from Star Wars. They can patrol sites such as factory perimeters and cost from $3.50 to $7.50 an hour. The company says it’s attracting new clients who are having trouble hiring workers to keep watch.
The longer that millions of Americans linger on the sidelines of the job market, the bigger the risk that automation could make America’s income and wealth gaps worse.
“If it continues, labor demand will grow slowly, inequality will increase, and the prospects for many low-education workers will not be very good,” says Daron Acemoglu, a professor at the Massachusetts Institute of Technology.
Gary Reber Comments:
Who will own the robotics? The broad American citizenship can if the Economic Democracy Act is passed and implemented.
