Automation fuels job growth in US

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A report from the Association for Advancing Automation (A3) has linked increases in the use of robots in manufacturing with higher employment in the USA. Bob Doyle, director of communications at A3, looks at the reasons for the trend

There is a strong correlation between robotics implementation and employment growth. Automation offers manufacturers improvements in efficiency that is driving up profits and employment – and as an enabling technology for automated production, machine vision is closely linked to this. At the same time, automation – along with changes in domestic workforces and rising overseas labour costs – is positioning the next wave of productivity and job growth while opening up new opportunities for worker advancement.

According to recent figures, increases in robotics shipments map closely to increases in US employment.

 

Industrial robot shipments vs. non-farm employment (1996-2014) 

Jeff Burnstein, president of A3, was recently quoted in a New York Business Journal article [1] saying that there’s a ‘fundamental misunderstanding about what the job-killers are. The number one job killer in the world is if you work for a company that can’t compete. That’s when the jobs go away.’ So how do companies compete better in today’s economy? Automation.

Robots help bring jobs back to the US

In the 2000s, brand-name US multinational corporations cut their domestic workforces by 2.9 million while increasing their overseas employment by 2.4 million according to the US Department of Commerce – typically to take advantage of dramatically lower labour costs. According to Working America’s report Sending Jobs Overseas: The Cost to America’s Economy and Working Families: ‘Between August 2000 and February 2004, manufacturing jobs were lost for a stunning 43 consecutive months – the longest such stretch since the Great Depression. Manufacturing plants have also declined sharply in the last decade, shrinking by more than 51,000 plants, or 12.5 per cent, between 1998 and 2008.’ As low labour rates tempted US companies to take their manufacturing operations overseas, US manufacturing jobs steadily declined.

 

US goods-producing employment (Bureau of Labor Statistics) 

The trend of outsourcing manufacturing operations offshore is beginning to shift, however. With rapidly rising labour costs in countries such as China, where the advantage of productivity-adjusted wages has been cut in half since 2005, manufacturers are seeing erosion in the cost advantages of manufacturing outside the US.

 

Labour rates are growing much faster in China than in the US 

Automation is helping companies remain cost-competitive while keeping their manufacturing operations in the US. Geoff Escalette, CEO of faucet-maker RSS Manufacturing and Phylrich in Costa Mesa, CA, stated that automation is helping the company keep and create new manufacturing jobs in the US. ‘The whole premise for our company is to bring manufacturing back to this country. Our new robot fits perfectly within that master plan.’

Robots giving workers new opportunities

Meanwhile, in the US the drive for higher education is producing a wave of employees who want rewarding, career-oriented jobs that are interesting and safe and that offer opportunities for advancement. Those desires often mirror employers’ concerns. Tedious, manual jobs tend to have high turnover, which drives up costs for recruiting and training, while workers who stay in those positions can drag down productivity with low morale. Repetitive operations can make it difficult for human workers to maintain consistent output quality, and the use of potentially dangerous equipment can lead to on-the-job injuries.

But as manufacturers use robotics to automate repetitive, dull, dangerous, and low-wage jobs, manufacturing is regaining its appeal for people seeking technical positions – especially those who are excited about learning to use robots. Jordan Klint, senior automation engineer at Vickers Engineering, in Michigan said: ‘In order to bring young people into the business, you have to have technology. The guys who report to me really enjoy the robotics side. They think robots are cool.’

Importantly, robots can also improve employee safety. In fact, of the thousands of fatal work injuries that occur in the US every year, [2] according to the US Occupational Safety and Health Administration (OSHA), there has been roughly one fatality a year in the past 15 years that has involved industrial robots [3].

As we move forward, a critical variable is providing the right technical education for prospective employees in order to meet demand. According to a skills-gap report by Deloitte [4], manufacturers will need to fill 3.4 million jobs over the next decade, with only 1. 4 million qualified workers available. In response, automation professionals are working to grow the educational curriculum for robotics to help populate the manufacturing sector with a new generation of technically trained employees.

Exploit technology, not people

US manufacturing is a complex industry that is shaped by outsourcing, the shifting desires of our increasingly educated workforce, and the demands for manufacturers to be more competitive in today’s worldwide markets. One element that impacts all of these variables is automation, which will be key to manufacturing’s revival in the United States.

References:

[1] http://www.bizjournals.com/newyork/news/2015/10/05/dont-fear-the-robots-study-shows-human-jobs.html[2

[2] http://stats.bls.gov/iif/oshwc/cfoi/cfch0012.pdf

[3] http://www.robotics.org/content-detail.cfm/Industrial-Robotics-News/How-Does-the-Accident-in-Germany-Affect-Industrial-Robot-Safety/content_id/5555

[4] http://www2.deloitte.com/us/en/pages/manufacturing/articles/boiling-point-the-skills-gap-in-us-manufacturing.html

Further information

AIA report: Robots fuel the next wave of US productivity and job growth 

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