Too many robots? The UK doesn't have enough

For all the talk of a robot insurgency, the UK significantly underinvests in new technology. Continuing on this path will only entrench the problem of low paid, low productive work in an already fragile labour market. It’s time to embrace the new machine age.

Automation anxiety

“AI is a fundamental risk to the existence of human civilisation”.

So said Elon Musk earlier this month as he raised concerns about the prospect of AI superseding human intelligence.

Most experts believe that ‘general’ AI of the kind Musk is talking about is many decades off, if at all achievable. But his remarks add weight to the growing belief we are on the cusp of a new machine age that will significantly alter how we live and work.

Robotics and AI systems are already being used to manage traffic flows in cities, detect cancers in MRI scans, spot fraudulent behaviour in financial transactions, accelerate construction on building sites, and turbocharge picking and packing activities in distribution centres.

The pace of change has led some economists to warn of the mass automation of jobs. Robert Cannon, an internet law and policy expert, says that “everything that can be automated will be automated”. Martin Ford, author of Rise of the Robots, cautions that “for average workers engaged in more routine, predictable occupations, the impact could be quite dramatic.”

Adding fuel to the flames are concrete estimations of automation. A now famous University of Oxford study predicted that 35 percent of UK jobs could be displaced by new technologies. More conservative estimates range from 30 percent (PwC) to 10 percent (OECD).

Invention vs. implementation

Yet, as the authors behind these studies are eager to qualify, just because a machine can do something doesn’t mean that it will be bought or adopted. And herein lies the rub for the UK: we are far behind the curve in the adoption of AI and robotics.

While there is no available data on purchases of AI systems, information on robot sales are helpfully collected by the International Federation of Robotics. Their data reveals that the global take up of industrial robots grew by 15 percent in 2015 to reach over 253,000 unit sales in the year.

The picture is markedly different for the UK. Sales of robots fell in the period between 2014 and 2015, with the UK purchasing fewer robots than France, the US, Germany, Spain and Italy. Today the UK has just 33 robot units for every 10,000 employees, compared with 93 in the US and 213 in Japan.

These figures have to be seen in the context of our smaller manufacturing base – still the biggest outlet for robotics. But in most sectors the UK has a bad record in tech investments (finance is a clear exception). Overall business spending on ICT, machinery and other equipment has barely budged in real terms since the turn of the millennium. The proportion of UK GDP accounted for by gross fixed capital formation (GFCF) – another measure of business investment – is 7 percentage points lower than it was in 1990.

An upcoming RSA report will reveal new survey findings showing that just a fraction of UK business leaders currently invest in AI and/or robotics, or plan to in the near future. Most think it is too costly or not yet proven. For others, the concepts of machine learning, deep learning and cloud robotics are completely new.

Bring on the bots

Should we breathe a sigh of relief? Some may view the slow diffusion of technology as the ideal outcome. It will give society time to adjust. Workers can keep hold of their jobs for longer. There will be less need to retrain and shift careers. Business can carry on as usual.

Yet it is worth reminding ourselves what business as usual means. The status quo is a largely low-skilled, low-paid, low productivity labour market that offers too few people the chance to flourish at work. Real median wages are still below their pre-crisis levels – an outcome reflected in our abysmal productivity rates. On average, UK workers are 30 percent less productive than their counterparts in the US.

Technology is not the only way to address our labour market shortcomings. In fact, technology can be the cause of them. AI and robotics may push people out of work, put downward pressure on wages, lead to excessive monitoring in the workplace, and reduce the scope for workers to use their initiative. Consider the various AI software packages that have emerged to monitor employees and flag anyone performing below a ‘productivity baseline’.

Yet technology could equally have the opposite effect. Deployed in the right way, AI and robotics could open up a better world of work for more people, not least those at the sharp end of the labour market. It could phase out mundane and dangerous work, raise productivity rates in traditionally inefficient service sectors, and boost real wages for a country still getting by on the pay packets of 2005.

This is not an exercise in wishful thinking. Academic research is contested but many studies reveal the positive impact new machines can have on the workplace. The LSE’s Leslie Willcocks, who has examined the take up of technology in companies such as Associated Press, reports that in most cases “jobs were reconstructed, and expanded, rather than wholly automated”. He also writes: “we found staff not feeling threatened by automation but instead appreciating having fewer repetitive tasks”.

Other studies look at the macroeconomic impacts of technology – and again, the results of machine adoption are often positive. A 2015 study looking at the use of robotics across 17 countries found they raised labour productivity by 0.36 percentage points annually over the period 1993-2007. They also lifted wages and total factor productivity.

Automation on our own terms

No one is saying these outcomes are guaranteed. The point is we have a choice in society about how to apply technology and manage its effects. Developers can choose what features they code into software. Employers can choose which types of robots or AI systems they purchase. Regulators can choose what constraints to put on tech companies. Educators can choose which skills and qualities to develop in the workforce of the future.

The challenge, then, is to accelerate the adoption of AI and robotics but in a way that delivers automation on our own terms. As Carl Benedikt Frey, one of the authors of the alarming University of Oxford study, put it: “any loss of equality [through fewer jobs] would be a failure of policy, not technology.”