The RSA has published a report on work and automation in the time of Covid-19. Two issues highlighted are the signs that Covid-19 is accelerating technological change and the RSA's risk assessment of which industries are at greatest risk of automation.
There are three key arguments that the pandemic will accelerate the pace of technological change:
- public health: businesses could increase automation in order to minimise interaction between workers and consumers and reduce the risk of contagion;
- consumer preferences: some new technologies will stick around because they offer consumers more convenient, enjoyable or affordable experiences;
- increased cost of labour during the pandemic: Social distancing and other protective measures increase the cost of human labour relative to machines that can still work in close proximity, don’t need to self-isolate and don’t require sick pay.
The report identifies examples of each argument in action. How those play out over the long-run is, of course, not yet known, and the RSA explains the difficulty of forecasting any future job losses. However, the RSA sets out a risk assessment of those industries at greatest risk of automation. The report does this by looking at furlough scheme take-up to identify the risk of Covid-19 towards an industry, ONS data on automation risk to an industry, and long-term data of growth or decline for different industries.
The report finds that "industries with the highest level of furlough take-up are considerably more likely to be at risk of automation. However, this relationship is far from straightforward."
Whilst the report ends by discussing potential policy changes to ensure that workers who do lose their jobs will have access to "good work", the report is also likely to be useful to businesses who are considering the risks they face from both Covid-19 and automation. Covid-19 is accelerating technological change and consumer preferences. So, as much as businesses are facing the challenges of the present, they also need to keep one eye on the future and may need to take action now to ensure that they are well-placed for what the future holds.
What might have taken three or four years… has happened in less than six weeks.