Half the Work People Do Can Be Automated, Says McKinsey (techinasia.com)

Half the work people do in their jobs can be automated, according to a study published by McKinsey Global Institute. From a report: Instead of assessing the impact of automation on specific jobs, the study went to a more granular level by looking at the activities involved in various jobs. The logic is that every occupation has a range of activities, each with varying potential for automation. McKinsey found that 49 percent of the activities people are paid to do in the global economy can be automated with "currently demonstrated technology." That involves US$11.9 trillion in wages and touches 1.1 billion people. The study encompassed over 50 countries and 80 percent of the world's workers. China, India, Japan, and the US accounted for half of the total wages and employees. Not surprisingly, the two most populous countries, China and India, could see the largest impact of automation, potentially affecting 600 million workers -- which is twice the population of the US.

Comments

Threshold

[Anonymous Coward]

What is the unemployment threshold going to be?
When unemployment caused by automation, robotics, etc reaches 10%?
15%...
20%..?

In the coming decades more and more people worldwide will become unemployable, and they will have nothing to do or any way to make a living?

How are governments and communities going to respond?

Re:Threshold

[Lije Baley]

Go watch some of those thoughtful dystopian movies they used to make. It has all been well foreseen and described.

Re:Threshold

[__aaclcg7560]

You're assuming that people won't find a different job their current job is automated. The days of working the same job for 50 years and getting a gold watch are long over.

Re:Threshold

[fropenn]

Or, maybe we could all just work fewer hours per week. Which would leave more time for, you know, living.

I heard a story from a friend who works with refugees. One family, he found a good job for the father, got them settled, etc. After a few weeks the father had stopped going to work. My friend asked the father what had happened, was there a problem with the work? Was it too difficult to get to work? Did they not like you?
No, he said, it was none of these things. He stopped going to work because he realized his children were growing up without him and it was his responsibility to be home to take care of the family. Once that was accomplished, then he would go to work. This then, of course, led to conversations about having to pay for things you need for life and so on, but I think there is a grain of truth here.

Life != work and there would be plenty of great living to do outside of work.

Re:Threshold

[serviscope_minor]

You're assuming that people won't find a different job their current job is automated.

You're assuming they will. It didn't happen with the industrial revolution. Their grandkids found other jobs, but for a lot of displaced agricultural workers it meant grinding poverty.

IOW it may or may not happen. You don't know and there's historical precident in both directions.

Re:Threshold

[bluefoxlucid]

90% of the workforce was farmers in 1870. It's 2% now, with a total of about 10% of all work supporting that (chemists, GMO, shipping, irrigation, fuel for all this shit...).

Economic growth is basically either "we have more people, so we make more stuff, because more people work more" or "we figured out how to use the same people to make the same shit in half the time, so we made twice as much shit." Wages essentially represent time.

Re:Threshold

[Billly Gates]

The same arguments hit in the19th century. Factories were scary! The Barron's of wallstreet and CEOs ruled. Illegal immigrants from Ireland , China, and Italy were taking all the jobs. Professional box makers, clock makers, textile tailor jobs were all disappearing! It was the end??!

Or was it? It turns out without the industrial revolution we wouldn't have a modern lifestyle today. It sounds very similar to today. Replace ethnic groups and names of baron titans to ones today? Viola.

True you do not have housewives as rich tailors making shirts anymore. You do not see professional box makers nor time keepers (before alarm clocks they would knock on your window to get u up) anymore. But we have cars, cheap goods, and the migrants descendents are all middle to upper class now.

Goods will become cheaper as globalism expands these countries buy our stuff back as they enter middle class. Look at China? Japan was poor too. Now we make money off them. When the dust settles 50 years from now we all will be rich. Africa will be the last challenge. Everyone will be better off

Re:Threshold

[bluefoxlucid]

It's not people who refuse so much as who can't; and that doesn't mean automation will wipe all jobs away, either, regardless of what the doomsday predictors who fear the pneumatic air gun and wooden shipping pallet say.

Wages are paid from revenue--from what's spent. Savings is made by keeping wage instead of spending, and spending more than wages means cutting into savings or creating debt. Wages represent labor time, and form the basis of price: if you need 10 hours of $10/hr work to make a thing, it can't sell for any less than $100 (although it can sell for more than that), else you can't pay your workers at all.

There are a lot of weird economics involved; one of them is that the money transfer only supports so many jobs at a given time, and that trade and technical progress make temporary unemployment. Technical progress is the purer form: internally, new technology means some people become unemployed for a few months or so, and your unemployment bumps by 0.1% until the prices fail to keep with inflation and the consumers buy more stuff with the money they're no longer spending--which requires more labor, thus replacing the jobs. Trade resolves itself in 1-3 years generally, and causes more or less labor force growth--early or late retirement, grad school versus employment, birth rate changes, more or fewer immigrant workers (trade uses outsourced workers--sending money away, not bringing workers here), and the like.

During these temporary transitions, some people can't get jobs. Some people need to be around when we suddenly need more laborers, but also will only work half the time as a result of our fickle economy and their happenstance place in it. As trade and technical progress increase the purchasing power of our same amount of labor, a smaller fraction of our income represents the necessary funds to support these people, and thus the general welfare; eventually, that fraction is smaller than the economic cost of not supporting them (e.g. if a transient laborer dies homeless, then you need to replace him by raising a child--a useless human being who only consumes for 15-20 years, providing no wealth of labor back to the economy during this time).

Re:Threshold

[Dragonslicer]

But by not having a social safety net for everyone, this kind of thing looks like it might ruin the US.

Why is it the government's or society's responsibility to support those that refuse to support themselves?

Because the alternative is that a large number of people will be unable to feed themselves. And one of the major lessons of history is that when large numbers of people have no other way to survive, they turn to robbery or outright revolt. Some of us enjoy living in a modern civilization and would like it to remain that way.

Automated Post

[asylumx]

Of course half of human work *can* be automated (I'd wager even more than that) -- but isn't the question really whether it's practical to automate those things?

Sure.. my job can be automated

[OzPeter]

My job can be automated as soon as someone can create some software that takes multiple sets of ill defined and incomplete specs* and can create a working, tested piece of code that not only does what was written down, but also does what was intended to be written down but never was.

* And in my current line of work there is a set of specs from the final customer, a set of specs from the company that builds the hardware and a set of specs from the company** I am working for that supplies the actual automation. And all of these specs are ill defined and incomplete in their own ways.

** And within that company the group that designs the physical wiring doesn't really converse with the sales critters that bid on the job, or with people like me who end up writing the control software***

*** Maybe they need a "Bender" module to emulate all the swearing I am doing at everyone else?

Re:Sure.. my job can be automated

[Imazalil]

Maybe it will be management that will be automated and for once we can all receive clear, though out, complete, realistic specs. /ha ha who am I kidding.

So?

[lucaiaco]

A stupid article. Almost everything can be automated, the crucial question is whether it is cost-effective to do so. It is not surprising that a lot of the activities that can be automated concerns workers in China and India, because in most cases, it's simply more convenient not to replace an $2/h organic automaton with a robot.

Here is your anecdote. A friend of mine was working on the manufacture industry. They had a branch in India, and his role was to mentor the product manager of the Indian factory. For a long time, he insisted that the factory in India bought this expensive machinery that they had been used in the Arizona for their production. The factory in India refused to do so by showing that paying 10 people to do the same job, for 100 years, would still be cheaper than actually buying the machinery.

Moral of the story: stupid article, move on.

mitigating factor

[buddyglass]

Automating things is itself work, and when a process or job changes it must be re-automated. If the automation wasn't done in a manner that's easily updated to accommodate minor changes, then the effort to "re-automate" something may approach the level of effort it took to automate it in the first place. So while lots of work may be automatable, the effort require to keep all that work automated on an ongoing basis incurs some amount of overhead.

McKinsey

[Pascal Sartoretti]

And 90% of McKinsey jobs can be automated with a good bullshit generator

Re:s/half/all/g

[arth1]

I for one would welcome a robot doing half of my work. That would be the half of my work that consists of meetings.

Re:s/half/all/g

[uncqual]

Unfortunately, that's the half that can't be automated with "currently demonstrated technology".

Most "currently demonstrated technology" has a logical framework. Most of what goes in meetings has no logical basis. Ergo, it ain't happening soon.

Someone please think of the C students!!

[ErichTheRed]

The work I'm actually most concerned about being automated is upper-middle class office work. Otherwise, unless the rules change completely and we stop using money and property as a store of value, economic activity will slowly wind down as people can't buy things and don't feel secure.

I work and have worked in large companies almost exclusively over a 20 year career. In environments like this, you will always have a distribution of abilities and skills. However, doing IT systems engineering work, I tend to agree with this report's findings. There are tons of jobs that could easily be automated with a little work. In banks I've worked at, as an example, there are people whose sole job is to accept documents mailed and faxed in for mortgage verification, enter the information into a computer, and take a fixed switch...case type action based on inspection. There used to be tens of people processing checks on two or three shifts. These jobs and hundreds more are the equivalent of an assembly line skill level, just working with paper or electronic files. Outside of the paper-processing world are tons of questionably-useful jobs in sales and marketing -- things like coordinating trade shows and putting out press releases. Across the organization are things like liaisons, project managers, business analysts, and other jobs that simply involve taking information from one group and passing it along to another. Yet, these jobs pay middle class salaries and give average-ability people something to do, regardless of how much raw revenue or cost saving they add.

I think a lot of the instability we see now is what's currently happening in companies - these simple jobs are either being eliminated or offshored in the desire for companies to save a few bucks here and there. The typical occupant of these jobs is a product of the last 30-40 years' obsession with sending everyone to college instead of giving them a trade or skill-based education. I went to a large state university, and back then just as now, they were pumping out thousands of generic business majors into the job market, most of whom were/are the typical C student partying their way through school. Here's the difference between then and now -- back then, that C student would just roll up to the career counseling office during their senior year. Recruiters from big companies would interview them, they'd get a couple offers, and accept some random entry-level position. Now, no one's hiring the C students and even the A and B students are having trouble finding that first job. (I was a B student, but that was in a hard science and I worked full time.) Fast forward, and that C student is working their way up the ladder with salary increases along the way -- paper pusher associate, senior paper pusher, supervisor of paper pushers, Manager of Bulk Pulp Transport, Director of Document Services...

The problem now is that the ladder is broken for an increasingly large swath of the population. Once the career progression is gone, that kills the salary increases that occur over time and allow for things like buying a house. 30 year mortgages are painful in the beginning but are supposed to get easier as you age because your income is expected to increase. Car manufacturers can't sell cars to people who don't feel comfortable enough in their jobs to take out a car loan or spend a little extra for a non-base model. And, companies can't sell products to their employees if the employees are worried about whether the axe will fall tomorrow. This squares with everything we've been hearing about Millenials - they don't want a car mainly because they can't afford one, they don't want to own a home because they're not secure in their employment, etc.

In my mind, this is why we got Trump. His rhetoric about rolling the clock back to the late 1940s was an easy sell for blue collar workers, but I think enough white collar workers took a hard look at their situation and remembered stories from their parents/grandparents about times when companies showed loyalty, when th