May 16, 2020

Could automation be the key to job creation in manufacturing?

Automation
US Manufacturing
white papers
reports
Admin
3 min
Could automation be the key to job creation in manufacturing?
The march of automation is inevitable—the technology is here and improving rapidly, and is already becoming an indispensible part of the manufactu...

The march of automation is inevitable—the technology is here and improving rapidly, and is already becoming an indispensible part of the manufacturing industry. But where does that leave the human workforce? A common concern is that the rise of automation will deepen issues of unemployment and income inequality. But one new study counters that concern, positing that the growth of automation in the United States could in fact create jobs as it revitalizes the manufacturing industry.

RELATED CONTENT: The robot revolution

The Association for Advancing Automation (A3) produced a white paper titled “Robots Fuel the Next Wave of U.S. Productivity and Job Growth,” which argues—as the title suggests—that increased automation could actually be a vital key to bringing manufacturing back to the United States en masse, increasing its status as a manufacturing competitor and ultimately preserving (and even increasing) the amount of enjoyable high quality jobs within the sector. The paper backs this position up with a combination of data from the Bureau of Labor and statistics from manufacturers over the years.

RELATED CONTENT: Where next for the automation revolution?

Jeff Burnstein, president of A3, recently discussed this white paper with ZDNet including the nuances of what they data they have collected means:

Jeff: […] We're not saying that employment rose strictly because of robots. What we're saying is that the opposite can't be true. Employment rises and falls for many different reasons, but what we've seen is that automation is not correlated to unemployment in manufacturing as a whole. The real issue that we need to talk about, and the real threat to jobs, is American companies remaining competitive. If they can't remain competitive and stay at home, then we lose jobs. Robots help companies stay competitive.

 

Burnstein also delves into the subject of automation versus offshoring and outsourcing in a competitive world, shedding light on the tough decisions that must occur to make the best choices for a business and an industry:

If a company has one hundred employees and decides to automate to stay competitive, and then it has to get rid of fifty employees that are now redundant, it's very easy to say that we've lost fifty employees. But that's not the case in a world where companies need to stay globally competitive. The company that automated saved fifty American jobs that would have been off-shored. What happened in the auto industry is that companies were chasing low-cost labor instead of investing in automation at home.

 

Will the world of manufacturing look very different in the near future, with human workers performing more high-level STEM-based work while machines do the assembling, packing, and heavy lifting? More importantly, can this transition help secure a stronger future for manufacturing in the United States? Check out the full interview and white paper to read on and consider the choices at hand. 

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Jun 8, 2021

IMF: Variants Can Still Hurt Manufacturing Recovery

IMF
Manufacturing
COVID19
Musk
Elise Leise
3 min
The International Monetary Fund (IMF) claims that while markets are rising and manufacturing is coming back, it’ll push for global immunisation

After a year of on-and-off manufacturing in the US, UK, and the eurozone, demand for goods surged early last week. Factories set growth records in April and May, suppliers started to recover, and US crude hit its highest price point since pre-COVID. As vaccination efforts immunise much of the US and UK populations, manufacturers are now able to fully ramp up their supply chains. In fact, GDP growth could approach double-digits by 2022

Now, the ISM productivity measure has surpassed the 50-point mark that separates industry expansion from contraction. Since U.S. president Biden passed his US$1.9tn stimulus package and the UK purchasing managers index (PMI) increased to 65.6, both sides of the Atlantic are facing a much-welcomed manufacturing recovery. 

Lingering Concerns Over COVID

Even as Spain, France, Italy, and Germany race to catch up, and mining companies pushed the FTSE 100 index of list shares to a monthly high of 7,129, some say that UK and US markets still suffer from a lack of confidence in raw material supplies. Yes, the Dow Jones has made up its 19,173-point crash of March 2020, and MSCI’s global stock index is at an all-time high. 

Yet manufacturers around the world realise that these wins will be short-lived until pandemic supply chain bottlenecks are solved. If we keep the status quo, consumers will pay the price. In April, inflation in Germany reached 2.4%, and across the EU’s 19 member countries, overall prices have increased at an unusual pace. Some ask: Is this true recovery? 

IMF: Current Boom Could Falter

Even as Elon Musk tweeted about chip shortages forcing Tesla to raise its prices, UK mining demand skyrocketed; housing markets lifted; and the pound sterling gained value. The International Monetary Fund (IMF), however, cautioned that manufacturing recovery won’t last long if COVID mutates into forms our vaccinations can’t touch. Kristalina Georgieva, Washington’s IMF director, noted that fewer than 1% of African citizens have been vaccinated: “Worldwide access to vaccines offers the best hope for stopping the coronavirus pandemic, saving lives, and securing a broad-based economic recovery”. 

Across the globe, manufacturing companies are keeping a watchful eye on new developments in the spread of COVID. Though US FDA officials don’t think we’ll have to “start at square one” with new vaccines, the March 2021 World Economic Outlook states that “high uncertainty” surrounds the projected 6% global growth. Continued manufacturing success will in large part depend on “the path of the pandemic, the effectiveness of policy support, and the evolution of financial conditions”. 

Mathias Cormann, secretary-general of the Organisation for Economic Co-Operation and Development (OECD) concurred—without global immunisation, the estimated economic boom expected by 2025 could go kaput. “We need to...pursue an all-out effort to reach the entire world population”, Australia’s finance minister added. US$50bn to end COVID across the world, they imply, is a small investment to restart our economies.

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