The robots are coming: What they mean for our economy

By Anthony York | Posted February 10, 2015

Call it the rise of the machines.

A new report says that more cheaper, better robots will replace human workers in over the next decade, pushing labor costs down 16 percent.

This is good news if you own a manufacturing plant. Maybe not so good if you have a manufacturing job.

We’ve seen how these trends play out in California, where our percentage of the nation’s manufacturing output has remained constant over the last several decades, but manufacturing jobs have plummeted as a percentage of the overall workforce.

The Associated Press reports, “The Boston Consulting Group predicts that investment in industrial robots will grow 10 percent a year in the world’s 25-biggest export nations through 2025. That’s up from 2 percent to 3 percent a year now. The investment will pay off in lower costs and increased efficiency.

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Robots will cut labor costs by 33 percent in South Korea, 25 percent in Japan, 24 percent in Canada and 22 percent in the United States.

The report estimates that currently, only about 10 percent of jobs that can be automated have already been taken by robots. Within another 10 years, the machines will have more than 23 percent.

“Depending on the industry and country, output per worker could rise by an estimated 10 to 30 percent over and above productivity gains that typically come from other measures,” the report states.

“As robots become more affordable and easier to program, smaller manufacturers will use them on a wider scale. This will greatly expand the market for robots and integrate them more deeply into industrial supply chains.”

The numbers are a good reminder that looking at manufacturing output is not enough to get the real story of what’s happening in our economy. We must also wrestle with the problem of how to cope with producing more by employing fewer people.





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Anthony York
Anthony York has covered California politics for close to 20 years. Before launching the Grizzly Bear Project in 2015, he covered Gov. Jerry Brown's administration for the Los Angeles Times. He is the former editor of Capitol Weekly, a former Associate Editor of the California Journal and of, where he also served as the Web site's Washington D.C. correspondent. He tweets at @anthonyyork49

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