Robots at Work

The Financial Times reported on a study “Robots at Work,” written by Georg Graetz, a researcher at the Department of Economics, Uppsala University, and Guy Michaels, London School of Economics, which examines the impact of industrial robots on jobs, productivity and growth.

Industrial robots are programmable and are widely used for assembly, packaging, inspection and agricultural harvesting. In recent years, use of industrial robots has increased sharply, while the price of the robots has declined by about 80 per cent, taking into account increased quality.

A brief summary of their findings and conclusions follow – readers may disagree

Job opportunities and wages

“We can see that industrial robots increase employee wages and increase productivity and that the  of jobs for low-skilled employees, and also to some extent for the medium-skilled, decreases, while job opportunities for the highly skilled increase,” says Georg Graetz.

“Most likely the profits realised through the introduction of robots are divided among the company and its employees.” (an optimistic view)

The composition of the labour market is changing towards a higher proportion of highly educated employees while at the same time the study suggests that the total number of jobs is not affected by industrial robots.

Increased productivity

Industrial robots increased the annual growth in GNP in the countries surveyed by 0.37%, and labour productivity increased by 0.36% (unbelievable accuracy)

“This means that without industrial robots, growth in labour productivity would have been about 5% lower during the 14 years we have studied.”

The contribution of robots to the economy is comparable to the economic importance of the railways in the 19th century or the more recent contribution from ICT (Information and Communication Technology).

“In this context, it is interesting to note that industrial robots account for only 2% of capital, which is much less than technological driving forces for growth in the past.”

Of the surveyed countries, the number of robots increased most in Germany, Denmark and Italy.

Countries that had a more rapid increase in the number of robots also had a greater increase in labour productivity.

Continued increases in productivity likely

The study suggests that:

  • An increasing number of robots produces a reduced increase in productivity – that is, there is a limited potential for utilising robots in production. ( we disagree – now is take-off, not slow-down, time – and what of the impact on all other sectors?)
  • Robots will continue to contribute to an increase in growth and productivity.
  • Industrial robots are evolving and will be able to do more.
  • At the same time, new types of robots are coming, such as medical robots that can perform surgery or different types of robots for transport.
  • This development will contribute to continued growth and production increases.


By refreshing contrast, consider the views expressed in an article by Kweilin Ellingrud who claims to cover ‘transforming large-scale companies and workplace diversity’ viz:

  • To date, the results of integrating automation and new technology in manufacturing operations have been promising
  • Their bottom lines have been improving via higher efficiency and greater employee productivity
  • There will be more automatic real-time data feeds and data monitoring
  • For employees, the mix of their work is changing to be less repetitive and more judgement-intensive
  • In addition, new and more exciting jobs are being created, rather than merely eliminating positions
  • Workers are or will be doing less predictable physical work, data processing and information collection – and, at the other end of the spectrum, making better decisions based on data collected, more managing of others and reacting better to what customers want
  • The result is manufacturing jobs are growing at the fastest pace for two decades
  • And, over all sectors, there are now far more people than ever before employed
  • In future, there will be a lot of job transitions and retraining needed


Kweilin then quotes MGI (McKinsey Global Institute) projecting that:

  • About 15% of the global workforce, or 400 million people, will be displaced by 2030
  • Another 8-9% of employees will work in categories that do not yet exist today (unknown unknowns?)
  • So there will have to be significant reskilling of workers



Kweilin and the MGI must surely trump the dismal views of Georg and Guy

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