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A robot moves ore samples around in the assay lab at Newmont Mining’s Carlin gold mine operation near Elko, Nevada, on May 21, 2014. (RICK WILKING/REUTERS)
A robot moves ore samples around in the assay lab at Newmont Mining’s Carlin gold mine operation near Elko, Nevada, on May 21, 2014. (RICK WILKING/REUTERS)

Agenda 2020

Will robots make us all redundant? Add to ...

The Agenda 2020 series asks experts to discuss what business leaders should be doing now to prepare their organizations to be healthy, efficient and growing by 2020. Read more at tgam.ca/agenda2020.

As robots and automated software take hold in the workplace, will they leave companies and consumers richer or poorer? For Erik Brynjolfsson, Schussel Family Professor of Management Science and professor of information technology at the Massachusetts Institute of Technology’s Sloan School of Management, there’s no simple answer. But he and Joshua Gans, Jeffrey S. Skoll Chair in Technical Innovation and Entrepreneurship and professor of strategic management at the University of Toronto’s Rotman School of Management, are clear that automation will deliver ever-speedier change.

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Dr. Brynjolfsson, who also directs the MIT Center for Digital Business, co-authored the recent book The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies with Andrew McAfee, the centre’s associate director. Here, he and Dr. Gans discuss how businesses can prepare for the next half-decade.

Will the rise of automation mean fewer jobs and fewer people buying things? What will the business world look like in 2020?

Erik Brynjolfsson: The economic disruption that we saw in the past decade will be even bigger and the technological change will be even faster, partly as a function of the power of exponential change as well as the increased digitization at the core of more and more industries. It’s going to have two broad economic effects, I think. One is bounty, which is a lot more wealth and productivity, although not all of it will be measured in the official statistics. So we’ll have a lot more very cheap and free goods, and that will make us better off in many ways.

But there’s also this concern about jobs and I would also say inequality, which is related. For 200 years, the Luddites have been wrong in that technology, contrary to their fears, has not led to any fewer jobs. But there’s no economic law that says everyone is going to benefit from technology.

It’s a genuinely open question whether we will have job creation continue at the pace it has historically or whether we’re going to see more and more difficulty, especially for certain classes of jobs – routine information-processing kinds of jobs. Even as [technology] makes the [wealth] pie much bigger, it’s possible for some people – even a majority – to be made worse off, and for people to have a much harder time finding employment. Since the 1990s in the United States and in most OECD countries, median income has stagnated.

What will be the effect on consumers? There’s this classic, perhaps apocryphal, anecdote about Henry Ford II and Walter Reuther, who was head of the United Auto Workers. Henry Ford was pointing to a lot of automation he’d put in place in one of their factories, and he said, “How are you going to get these machines to pay union dues, Walter?” And without missing a beat, Reuther responded, “And how are you going to get them to buy cars, Henry?”

There is a real fear that as jobs disappear, it will be more difficult to maintain GDP and consumer spending if there aren’t people who are earning that income, and if the remaining income is concentrated in a relatively small group of people who don’t have the propensity to spend.

Joshua Gans: I definitely agree with the notion of accelerated technological change. We’re six years away from 2020. Look at what has happened in the last six years: They made millions upon millions of people walking supermen in terms of their ability to access knowledge anywhere, especially on their mobile phones.

What are the prospects for technological unemployment? It’s very easy to see a robot doing tasks that one or 10 or 100 people could do, and doing it with less complaint. So when you look at those details, you say, “How could it not be that these things can’t come in and cause unemployment?”

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