Pandemic boosts automation and robotics (FT)

Financial Times title: Pandemic boosts automation and robotics

FT subtitle: Companies turning to technology provide boost to global trade but labour market will feel implications

By: Valentina Romei

Date: 20 October 2020

“The coronavirus pandemic has devastated many businesses but Claus Risager has never been busier — demand at his Denmark-based company Blue Ocean Robotics has “skyrocketed”.

The company’s sales of disinfectant robots have risen 1,000 per cent this year on surging demand from hospitals, schools or airports such as London Heathrow. “Businesses where the perception of the customer is important want to show that they are doing something about safety,” Mr Risager said.

The pandemic is driving a shift in companies’ use of technology, both official statistics and business surveys suggest, making the automation and digitalisation industry one of the few winners from this year’s economic turbulence.

The spread of the virus “has accelerated the use of robotics and other technologies to take on tasks that are more fraught during the pandemic”, said Elisabeth Reynolds, executive director of the Massachusetts Institute of Technology’s task force on the work of the future. “It is fair to assume that some firms have learnt how to maintain their productivity with fewer workers and they will not unlearn what they have learnt.”

Note LO: see article for diagram: Use of robots is forecast to rise rapidly

Robotics and automation-related international trade and output volumes have increased in many countries, bucking the overall downward trend in global trade.

US goods imports contracted 11 per cent in the first eight months of the year compared with the same period last year, but imports of industrial robots rose 5 per cent, according to data from the US International Trade Commission.

Note LO: see article for diagram: US imports of robots buck the trend 

The number of US employees in computer system design dipped 2 per cent in September, compared with the same month last year — that is less than half the fall across manufacturing and professional services and compares to a 20 per cent drop for hospitality, food and accommodation. 

In Japan, sales of industrial robots outperformed those of industrial machinery more generally, according to Japan’s Cabinet Office, while the number of robots exported from the country rose at an annual rate of 13 per cent in the second quarter, the Japan Robot Association reported.

Note LO: see article for diagram: Japan’s production of industrial robots grew during the pandemic

In August, China registered a 14 per cent annual growth in the production of industrial robots. In the eurozone, production of special-purpose machinery and lifting and handling equipment, which includes industrial robots, has outperformed many sectors, particularly car production. 

Eurozone employment was 3.1 per cent down in the second quarter compared with the same quarter last year, with professional jobs shrinking by 4.2 per cent — but employment in computer programming rose. 

The pandemic is “a real boost for digital factory technologies”, said Patrick Schwarzkopf, member of the board of the International Federation of Robotics (IFR). 

Some smart factories have continued to operate with workers monitoring and carrying out maintenance from home, he said, while the installation and operation of new tools and machinery has shifted to augmented reality, mixed reality and remote digital services as people were unable to travel.

Note LO: see article for diagram: Eurozone’s robot-related manufacturing proves resilient

IFR expects the number of professional services robots in operation around the world to rise by 38 per cent this year and that growth to continue in the next two years. 

Logistics robots account for the lion’s share and their numbers are expected to double between 2019 and 2021. But the use of all types of robots is set to increase, in particular in medicine and cleaning. 

Digital interaction with customers has accelerated the equivalent of many years in just months, according to a recent survey of business executives by the consultancy McKinsey. Changes in digital and technology adoption are taking place about 25 times faster than before the pandemic, the survey found.

Note LO: see article for diagram: The pandemic has accelerated the digitalisation of businesses

Executives’ attitudes have shifted from using automation for cost reduction to gaining a competitive advantage, McKinsey found. The majority expected the technological and digital innovations to remain in place even after the global economy recovers from the virus’ impact. 

The shift has deep implications for the labour market; some economists fear it could erode jobs such as retail assistant and receptionist, although others say it should increase employers’ demand for workers with higher technological skills. 

“There is nothing automatic about automation destroying jobs, although it always changes the character of jobs,” said Diane Coyle, a professor at the University of Cambridge. “What happens depends on the skills of the people working with the machines.” 

Overall, in the next five years, “digitalisation will create more jobs in industrialised countries than it destroys”, according to Thiess Petersen, economist and senior adviser at the Bertelsmann Foundation, a think-tank. 

“The development of a digital infrastructure requires corresponding investments and training measures — in other words, people who carry out these economic activities,” he said.”

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Note LO: see article for testimonies by:

• Fabrizio Bernini, founder, Zucchetti Centro Sistemi (ZCS)
• Claus Risager, chief executive, Blue Ocean Robotics
• Alex Book, chief strategy officer, Arcade

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Source:
https://www.ft.com/content/358f6454-e9fd-47f3-a4b7-5f844668817f