My 75-year-old father will probably never stop working. He "retired" several years ago, but it never took. His current job involves driving checks and other documents to bank branches across central Indiana. Some years ago, when Congress passed the Check 21 Act, which allows digital copies of checks to be substituted for paper originals and thus cuts down the manual aspects of check processing, I worried his job might be eliminated. (I think my stepmother worried too, envisioning lots of hours of him looking for stuff to do around the house.)
My dad is part of a broader trend. While lots of people get worked up about offshoring, automation will likely eliminate just as many jobs, a point I made yesterday in a post about cloud computing's impact on IT jobs. I cited an interview on globalization with The Hackett Group's Erik Dorr and Michel Janssen, in which Dorr told me "the biggest competitor to globalization is automation." He elaborated:
So if you have a process that is highly automatable, then there may not be enough work left to cost-effectively ship offshore. If you go through a list of industries, you will definitely find some that are so inherently structured and repeatable, that 95 percent automation is the ticket. That'll make the whole globalization question a moot point.
Of course, as Dorr explained, automation is capital intensive and offshoring is labor intensive. So rather than making the up-front investment in automation, some companies send work offshore. But with the allure of labor arbitrage diminishing and as the economy recovers, more companies will likely invest in automation to streamline processes and boost efficiencies.
Don't believe me or Dorr? Maybe you'll buy it when it comes from S. Gopalakrishnan, the CEO of Indian outsourcing giant Infosys, who shared the same concern about automation's impact on jobs, jobs that were previously offshored to India, with New York Times blogger Vikas Bajaj. Though the trend could take 20 to 30 years, Gopalakrishnan believes advanced automation eventually will eliminate many of the labor-intensive, back-office functions now being performed in India and other lower-cost countries.
He offered an example in which automation-driven process improvements allowed Infosys to eliminate two-thirds of a 300-person group assigned to enter orders into an electronic processing system for a customer. A combination of increased customer self-service and consolidation of previously disparate computer systems reduced the need for workers.
Another example mentioned by Gopalakrishnan involves the U.S. shift in media delivery, from print to electronic. While some new media jobs will be generated, they won't offset all the others that will be lost. When you think about how newspapers, magazines and other publications are produced and delivered, it seems almost laughably archaic in an era when the same information can be made available via the Internet.
Seriously, you use huge and expensive machines manned by costly union labor to produce unwieldy print editions, then pay to have all those physical copies prepared, sorted and delivered by fleets of people in vehicles. It might be more "romantic" or "colorful" than simply doing a series of electronic hand-offs and posting content online, but it sure as heck isn't as efficient.
As a computer professional, it doesn't concern me. But as a CEO and a business leader, it does concern me because we as human beings adapt to change very slowly, and technology seems to be accelerating in its evolution and change.