SingularityHub recently reported that a Silicon Valley area hospital is announcing layoffs at the same time it begins to employ robots:
El Camino Hospital in Silicon Valley is looking to cut expenses, so they’ve invested in 19 Aethon TUG robots. These smart carts can haul supplies around the hospital, making deliveries and pickups at a fraction of the costs of human workers. El Camino recently announced that it would further be cutting costs by firing up to 140 workers from its two facilities in Los Gatos and Mountain View.
It should be noted that most of the layoffs are probably not directly related to the decision to use robots. Nonetheless, I think this shows that even healthcare—the one field on which nearly everyone pins hopes for significant job growth—is not immune to automation. It also demonstrates that the economic tradeoff between robots and even relatively low wage/low skill jobs is beginning to tip in favor of the machines.
Economists often speak of “polarization” in the job market. The belief is that technology has primary impacted middle skill jobs, leaving plenty of high wage opportunities for the well-educated as well as lots of low skill service jobs with very low wages. As I’ve been arguing here, I think this is what has been happening so far—but it will not continue to be true indefinitely. Automation will push up into the high wage areas via technologies like narrow artificial intelligence/expert systems, while it penetrates lower skill job sectors with more affordable robotic technologies. In general, I think economists have a serious problem with analyzing past data, determining a trend, and then assuming it will continue basically forever. Technologies change rapidly.
In spite of this news, I think that healthcare will certainly remain one of the most promising areas for future employment. However, the same cannot be said for other lower skill jobs in the commercial arena. While delivering medical supplies in a hospital may not be an especially high-skill job, it is certainly not an unimportant job. If robots can be trusted to autonomously navigate crowded hospital corridors to deliver medical supplies in a timely fashion, then they can and will be used in other commercial settings like warehouses and retail stores.
In fact, CNET News reported that Wal-Mart was already looking into the use of inventory robots back in 2005. These robots would have prowled the aisles at night taking complete store inventories—a job that is, of course, currently done by workers. One has to wonder how long it will be until Wal-Mart and its competitors begin to look seriously at robots in a number of work areas. Jobs involving shelf-stocking, inventory control, and materials moving are all likely to be susceptible at some point.
The scary thing is that for many workers these are really the jobs of last resort. This is where people who lose good jobs in manufacturing or other areas often end up. What options will these people have if even these jobs are someday much less plentiful?
Martin Ford 
Over the past 30 years the buying power of the dollar for manufactured household goods has generally increased faster than inflation: computers, clothing, telephones, refrigerators, televisions, microwave ovens, lawnmowers, and many other goods are now cheaper in inflation-adjusted dollars than they were in 1980. This has been achieved with a mixture of automation and offshoring. The problem for the squeezed American is that the improvements have been with these relatively small-ticket items, while faster-than-inflation price increases have been pinching him on big-ticket items such as education, medical services, and housing.
There are two ways the diverging prices could start converging again. Manufactured goods could go into a steeply inflationary regime, and the whole economy could chase the inflationary rates seen in health care, or the same automation/offshoring combination that deflated manufactured goods could start reversing the inflation in education, health care, and housing. If I were a betting man I’d pick the latter. This shows the beginnings of medical cost cutting with automation, and As The Lights in the Tunnel mentions even radiologists and other medical specialists may eventually face the same pressure. The construction of housing is just a kind of manufacturing; I see no reason automation can’t take it on too. Education doesn’t even need super-robots to bring its prices back down, just a reversal of the absurd proliferation of administrators over the last 30 years. So I can easily see entire nations, and perhaps the world economy as a whole, enter a deflationary regime. That would be terrible news for people deep in debt, not necessarily terrible for everyone else. The century of the first industrial revolution was generally deflationary, but if you look at standards of living instead of dollars and pounds, a worker at the end of the century was generally better off than one at the beginning of it.
The other elephant in the room is overconsumption, and I mean of labor, not raw materials. In the long run, the goods and services Americans sell to the rest of the world must generally balance those they buy from the rest of the world, and with the globalization of production that really comes down to working hours. Right now an hour of American minimum wage labor can buy about 8 hours’ worth of Chinese minimum wage labor. These values will converge over time unless you believe that Chinese will be permanently less educated, less industrialized, and less ambitious than Americans. If trade partners don’t buy American intellectual property and services — Chinese get paid for making computer chips but don’t pay for American software, movies, or banking (they copy the first two and wisely avoid the latter) — Americans must eventually consume fewer tangible goods or substitute domestic manufacturing for imports. Reinvigorating American consumption without addressing the trade imbalance is just going to hasten economic earthquakes, not prevent them.
Speaking of the replacement of workers by robots, I recently wrote an article on the possible use of quadcopter “Drones” being used as both remote telepresence units, as well as autonomous “drone workers” in many settings.
http://hplusmagazine.com/editors-blog/fly-your-pov-around-your-own-personal-quadcopter
A lot of jobs could easily be done remotely or automated with quadcopters of various sizes and abilities. We may be seeing a lot more jobs going sooner than anyone expects.
Great article Martin. It’s always nice to meet others with like-minded views on the, what seems inevitable, outcome of the economy and labor workforce from advanced automation. It’s not hard to see that the trend will continue until robots are capable of doing advanced tasks. From the Da Vinci Surgery machine to something as simple as these cart pushing robots, it seems reasonable to assume that from the dawn of man until now, advancements will not go away. The real question is what will we migrate to after machines are replacing people in droves? I’m a member of thezeitgeistmovement.com and although some many not agree with everything, they definitely focus on this issue in their social direction and goal towards liberating people from work. I’d definitely recommend it though to those who may have been affected from the layoffs or anyone for that matter.
Anyways thanks again and I’ll be sure to give your book a read soon as you seem to have a good grasp on these topics and the outcomes.
Liberation from work means liberation from wage, how do you like this explanation? 🙂
For a hands on view of how robotics is impacting healthcare check out ths event coming up…
MassTLC RoboHealth Summit: Improving the Quality of HealthCare with Robotics
Wednesday, October, 20, 2010, 1:00-6:00pm @ The Boston Park Plaza Hotel
MassTLC is working with Partners HealthCare’s Connected Health Symposium to look at how Robotics is impacting healthcare and improving the lives of patients. This pre-symposium executive summit features a keynote by iRobot CEO Colin Angle and will explore a full range of robotics applications in healthcare from robotics in surgery to robotics solutions for assisting the elderly. Each session will examine the latest products as well as future research, with a focus on how these innovative tools are impacting the quality of care in our lives today and in years to come. Speakers include robo health experts from Cardiorobotics, Hocoma, Intuitive Automata, Intuitive Surgical (da Vinci Surgical System), iRobot, iWalk, UMass Laboratory for Perceptual Robotics, Myomo, Partners HealthCare, Surgical Navigation and Robotics Lab at Brigham & Women’s Hospital & Harvard Medical School, Tibion, vGo Communications, and more. Register at, http://robohealth.eventbrite.com/. Save up to $295 when registering for both the Partners Connected Health Symposium and MassTLC’s RoboHealth Summit with discount code “MTLC” when registering for both at http://connected-health.org/events/symposium-2010.aspx.