Report: Next automation wave will claim 25 percent of current jobs

I walked into a McDonald’s the other day and used the automated kiosk to order my usual: a Big Mac value meal, which, back when a human took my order, took about 5 minutes to deliver, less if I gave a particular look to the human at the register. This time, I had what I came for after 15 minutes.

That’s the sort of automation that is taking people’s jobs and while many business owners say they’ll use automation to redeploy humans to deliver a better customer experience, many aren’t. That’s just the way it is. Even if you don’t lose your job, you’re feeling the impact in some fashion.

There are 1.3 million people in Minnesota, Montana, North Dakota, South Dakota, the Upper Peninsula of Michigan and northwestern Wisconsin who are going to lose their jobs thanks to computer-driven automation, the Minneapolis Federal Reserve reported this week.

“The impact is expected to fall disproportionately on workers in low-paying jobs and, in general, rural areas would be harder hit than metro areas, which have more diverse economies,” according to the Fed, which cited a Brookings Institution study.

One quarter of all jobs are at risk of being eliminated. Truck drivers and restaurant workers are particularly vulnerable.

And while one-third of the vulnerable jobs are in the Twin Cities, much of the impact will be felt in rural areas that don’t have many of the type of jobs the Cities have — so called “low-risk” jobs such as registered nurses and personal care aides.

There are, for example, four times as many truck drivers per 1,000 workers in western Wisconsin as in the Twin Cities.

In fact, the Twin Cities, Rochester, and Mankato (Minn.) take the lead with more than 40 percent of jobs at low risk. The Ninth District average is 38 percent, and the national average is 39 percent,

On average, 47 percent of the tasks involved in jobs throughout the district are easy to automate or will be in the foreseeable future, a percentage point higher than the national average.

As the jobs disappear, more might be created in other fields.

“Who in the 1980s could have foreseen job titles such as social media coordinator and search engine optimization specialist?” said the FedGazette story. “For another, just because a task can be automated doesn’t mean it will be. The investment can be too costly or disruptive for some businesses.”

But it seems undeniable that lower wage jobs will disappear and a lot of people are going to be out of work and as business charges ahead with the available technology, few people seem to have an idea how exactly the numbers are supposed to add up even if all the Baby Boomers take their leave.

(h/t: Paul Tosto)

  • Jerry

    The paradox of modern capitalism: how is anybody supposed to buy anything if nobody has a job?

  • Kassie

    I’d suggest that it is possible it took longer to get your order at McDonald’s because of the quality and number of those who are employed. Right now, it is hard to fill jobs, even good paying jobs. I’ve got to imagine McDonald’s is taking anyone they can to fill positions and can’t be too choosy who they are hiring and may also be down a considerable number of staff. I know that’s the case at my work, and we pay a lot of folks over $80k/year.

    • Jack Ungerleider

      At my local McDonalds a couple of weeks ago I pulled into the drive thru placed my order and went to the window to pay. There wasn’t anyone there to take the money. I was ready to be irate until I saw that the person who handed the order out the front window then came to the back window to take my money. They were short handed and she was working both ends of the store.

      • Why didn’t they just take the money at the one window where they dispensed the food? That’s what they used to do before they went for the newfangled two-window process.

        • jon

          I don’t even think McDonalds keeps a cash register at the second window any more…

          When I supported POS systems they’d configure them such that you couldn’t take money at the food window during certain times of day…. it was supposed to be a loss prevention measure (keep employees from stealing).

        • Jack Ungerleider

          This is a recently remodeled McDonald’s and I don’t think there is a register at the front window. If they wanted to take cash at the front they would need to use one of the counter systems. (This is the natural progression of what Jon described in his response.)

  • Jack Ungerleider

    As some comfort I provide a story that was highlighted in the recent AARP news letter. Here is the store from hotelmanagement,net:

  • Credit Warrior

    Many of the jobs that automation focus will hurt the younger 1st time, 1st job sector and any job that requires mind numbing,repetitive movement. Those type of jobs are easy to automate. Education is key to learn a skill that will compliment the automation wave that is coming or a skill that is difficult to automate.

  • boB from WA

    I find it odd that the Fed thinks that truck drivers are at risk for losing work. If they are thinking of automated trucks or fleets of trucks with one person guiding 3-4 rigs, given that Google, Uber, et al still can’t get automated cars right, what makes Tesla or Freightliner think they can with a vehicle 20 larger? What I see when I’m on the road is trucking firms “screaming” for more drivers.

    Is there a timeline to this changeover that Fed thinks will happen, because I didn’t see a reference to that anywhere in the article?

    One other note: As there are 10k baby boomers retiring everyday, the pool of workers is beginning to shrink. Won’t we need automation to keep up the productivity standard that have already been set?

    • John

      The most interesting version of trucking automation I’ve seen is something that Volvo was working out in Europe several years ago. There was one driver, and there were 4(ish) trucks. The three behind the first one followed (very closely – only a couple feet between them), so the driver drove, and the others followed. It looked like a train.

      That seems a lot more straightforward to implement than full automation, and is at least somewhat scaleable. The issue I saw with it was the 50-52 different sets of laws that need to be updated in the US to make it happen. (And the Teamsters union will probably have an opinion)