The Current Confluence of Labor and Automation – Trends Foretold and Experienced
by Dean Starovasnik
So how does one choose a profession, a field in which to exercise your gifts, your abilities, apply your experiences, make a difference? Almost a quarter century ago I was preparing to leave the Navy where I’d been an officer for 10 years. I had (have) a wife and two young (then) kids. So a field that would allow me to support them reliably was certainly a preference.
Do you remember “Mega Trends?” That book indicated that there would be a very large number of people with disposable income – people my age up to my parents’, the Baby Boomers basically – who would want to and be able to buy stuff come the turn of the century. However, the generations following them – we call them now Gen X and Millennials – would be of a size that there would be a shortfall, perhaps pretty significant, of people able and willing to make and handle the stuff that the older generation wanted to buy.
So I chose to pursue work in the field of automation, based in part on those predictions. And while I’m not particularly prescient, if I were, I’d have chosen a different field, much of what was anticipated has come to pass, though with some modification. Two changes in particular have altered the outcome of the Mega Trends predictions. The first is the rise of e-commerce, a business model in which we, the consumers, pay someone else to walk the store or storage aisles, pick up or pick our desired stuff and bring or ship it to our house. This sea change in the economy was not anticipated in the early 90s. Then the Internet had just begun to differentiate itself from DARPANet (where I had my first e-mail address) from which it was birthed. Nonetheless, capitalism flowed into this new channel, thus increasing the labor content associated with our consumption of stuff.
The other trend of significance is the rise in immigrant labor in the work force. This along with the recessionary forces of the previous decade, have dampened the impact and delayed the arrival of the most significant portion of the predicted labor shortage. Nonetheless, the inexorable forces of population and consumption have brought us to this point; the point where hourly wages for warehouse workers are rising at twice the rate of inflation, where filling a second shift fork truck driver’s seat requires not just a shift premium but full benefits and a signing bonus while filling a third shift position has become an HR nightmare.
So, as the labor portion of the automation equation has been moving upward, the capital investments associated with implementing labor solutions are shrinking. But then that’s the subject of another blog…