Will Robots Be Good Or Bad For Our Jobs.

A recent study of Japan’s adoption of industrial Robots from 1978-2017 offers surprising insights on the possible future role of Robots within employment.  Contrary to previous studies and attitudes regarding Robots and employment,  the study suggests that Robots could expand employment and dramatically increase wages.

 

The theory that Robots can and will work alongside humans with future labor replacement technology is now a real possibility.  The question of how Robots automation will affect the future of employment has always been a strong talking point.

 

If we look at Japan’s experience of Robot adoption, it can be misleading and rather confusing especially If we go back to earlier times where Robots were produced domestically.  Japan’s industrial Robot producers expanded during the 1970’s and 1980’s through continual innovation which met the needs of industries and removed workers from often hazardous and labor intensive parts of the work environment.

 

At the same time, the falling costs of Robots also greatly influenced their adoption within industries.  At an industry level, a 1% decrease in Robot price increased Robot adoption by 1.54%.  More surprisingly a 1% decrease in Robot price increased employment by 0.28%.

 

The study also shows that an increase of one Robot unit per 1000 workers increases employment by 2.2%.  The studies also consider the effect of Robot automation on employment in both manufacturing and non -manufacturing sectors.  The findings show that employment in non- manufacturing neither increased nor decreased with the application of Robot automation.  This shows that within-region-across-industry reallocation from services to manufacturing did not occur, suggesting instead that an across-region reallocation of workers occurred.

 

The declining population in Japan, Robots worked rather like magnets that kept workers from leaving and going to other areas.  Although the total employment increased when robots were adopted, the hours each worker worked decreased.  This suggests that robots may have worked more as a work sharing and time saving technological solution.  this implies that the hourly wage effect might be even more positive than once thought.