The Effects Of Job Automation On The Workforce and How To Fix Them

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Job Automation

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Throughout human history, job automation has been replacing human workers. When humans learned to work bronze into their daily tools, it drove stone workers out of jobs. When iron tools came along, bronze workers had to go and find new ways to earn a living.

So, understandably, humans have always looked at automation with an impending sense of doom. ‘Robots will take over’, ‘human workers will become obsolete’, and ‘machines will drive everyone away’.

Yet, the data and facts do not support this hysteria.

For example, robot cooks are increasingly becoming a top trend in the restaurant industry, but they cannot replicate the creativity and innovation of a chef, a culinary artist. The robot cook may follow certain specific instructions, and cook a few dishes repeatedly without flaws, it cannot taste, experiment, and innovate.

So, while it’s true that entire job sectors have almost been eliminated due to advancement in technology — jobs in the agriculture sector went from 40% in 1900 to 10% in 1950 —, all that disruption has caused new kinds of jobs to appear, growth in other sectors of employment, and an overall improvement in human lifestyles.

Having said that, it’s important to consider the fact that most recent job automation will be led by AI and robotics — technologies far superior and of near-human-intelligence than mere mechanical machines.

Studies have suggested that if the current pace of advancement in AI continues, a large number of employment sectors will be significantly impacted by this new age of automation. Jobs like those of physicians, radiologists, truck drivers, material handlers, mechanics, and more will go through seismic shifts.

Side-Effects Of Job Automation On Workers

Below are some of the major impacts job automation will have on the workforce.

Side-Effects Of Job Automation On Workers

1. Jobs Will Be Lost

There is no way around it. Some jobs will be lost when AI and robotics become fully implemented in the workplace. Continuing with the example of a robot cook in the restaurant kitchen, it’s easy to predict that such a contraption will eliminate a huge number of repetitive, manual tasks that keep a kitchen functioning.

Cleaning, plating, cooking a limited number of dishes with fixed recipes, keeping stock of the kitchen inventory, scheduling the wait staff, and similar tasks will benefit from AI implementation.

People who perform these jobs, a small army of cooks, will need to find work elsewhere.

2. Displacement Of Workers

As technology advances and more and more economic sectors adopt AI and other modes of digital automation, more and more jobs of today will have the potential to become automated in the near future. As this rolls out, mass layoffs may take place.

Large numbers of job layoffs directly result in displacement of workers. Not only will people be displaced from their current places of work, but they may also have to move geographically to find other jobs.

The added financial stress of relocation will cause further stress to workers who have just lost their livelihoods.

3. Income Inequality Will Increase

Leading economists and researchers in MIT have studied the impact of job automation on skill gap and income inequality, and have found that technology that replaces jobs always impacts low-skill workers the most.

High-skill workers like engineers and surgeons may benefit from sophisticated technology, but customer support operators or lab technicians will suffer due to the skill-biased technological change.

In other words, a high-skilled worker may be able to find a job in another sector or have the means to reskill themselves, but a blue-collar worker with lower wages will have a financial crunch on their hands, and limited resources to gain new skills.

4. Employees Will Have To Settle On Lower Wages

According to the MIT research quoted above, for every robot per 1,000 workers, wages decline by 0.42%. In fact, between 1990 to 2007, introduction of robots in industries have caused average wages to be reduced by 0.77%.

So, even in industries where automation does not directly result in net job losses, wage losses emerge as the biggest stressors. Not to mention changes in employee roles affect the meaningfulness people derive from their jobs.

For example, managers or supervisors whose job it is to oversee operations may have to deal with a down-sized role. Since tech-operated tasks do not need oversight, managers who remain on the job may have to compromise on lower wages and a diminished role just to ensure job security.

5. Resources Will Be Needed To Reskill And Upskill The Workforce

With AI paring down job roles, it becomes evermore important to invest in learning high-level skills that bolster job roles when augmented with technology.

Some of these skills include:

  • • High-level decision making
  • • Taking initiatives
  • • Anticipating challenges and building strategies
  • • Emotional intelligence
  • • Interpersonal communications
  • • Team building and team work

Of course, there are tech-based skills too that you can learn to make yourself adaptable to the new reality of AI becoming integral to workplaces. These include programming, coding, natural language processing, and more.

While upskilling and reskilling sounds ideal, it may not be possible for everyone. Because first, who will pay for all this retraining? Government or employers? Will the workers be allowed reduced work hours so they can spend that time learning new skills? If not, how will childcare be managed if working parents have to devote more hours to equip themselves with new skill sets?

These are important questions to consider, and unless governments and employers join forces, a large number of displaced workers will be left with no new skills to find new work.

How To Minimize The Damage To The Workforce

Learn from Nokia’s Bridge Program.

In a case study published by Sandra J. Sucher and Susan J. Winterberg, in Harvard Business School Publication, the authors share the story of how Nokia created a new, comprehensive way of organizational restructuring in which displaced workers were given support and means to retrain themselves and find new employment opportunities.

This is how the story goes.

In 2011, Nokia shut down its phone R&D centers and factories in 13 countries. It was a hard decision, taken to save the company and its future in a drastically new competitive environment in which Nokia was badly losing.

The decision was set to impact 18,000 workers and disrupt local communities and employment markets.

Yet, the company was determined not to repeat the mistake it had made in 2008 in Bochum, Germany, when it closed down a factory plant. The workers there were never told of the decision, and only learnt it when they showed up to work one day. They found the doors closed, and were directed to a local arena where they were told they were being laid off as the plant was not cost-effective.

The whole thing was so sudden, so disrespectful, and so extreme, it resulted in massive public protests, people boycotting the Nokia brand, and damaging its global goodwill.

So, in 2011, Nokia developed a new way to handle company layoffs. This new approach — the Nokia Bridge Program — reflected the company values, and committed to maintaining morale and industry among employees who were going to lose their jobs.

This sustainable method of dealing with job losses and transitioning the impacted workers to other sectors of employment can be summarized in the following 6 steps.

1. Notify Them Well In Advance

As soon as it becomes clear to you that you will be laying off people, let them know. Send a company-wide or department-wide email (if your decision only impacts certain departments or teams) that you will be letting go of a significant proportion of your workforce.

Such advanced notification not only is required by law (the WARN Act compels you to give workers 60-days of advance layoff notice), but also has many benefits for you, your company, and impacted workers:

  • • It dispels any harmful rumors
  • • Prevents any doubt or uncertainty forming within the ranks
  • • Improves your goodwill as an authentic and upfront leader
  • • Emotionally and psychologically prepares the workforce for what’s to come
  • • Enables workers to start devising strategies for the eventuality
  • • Brings everyone on the same page
  • • Allows managers to distribute workload in a way that helps impacted workers spend reasonable time retraining or looking for other jobs
  • • Keeps the morale high as people finish up their current projects
  • • Allows you to hold discussions with teams where you can gather crucial feedback to inform your further moves

Layoffs are always a complicated decision. By inviting open conversations, you remove a lot of your hurdles, and enable everyone to deal with the news with more grit and determination.

Through its Nokia Bridge Program, the company involved impacted workers

2. Create Support Programs And Involve Impacted Employees To Design How These Programs Will Run

Through its Nokia Bridge Program, the company involved impacted workers as part of its decision-making process.

As these employees were going to be directly affected by this decision, it only made sense to ask them what it meant for them, the different ways it would impact them, the kinds of support they needed, how to make the transition more helpful, and what reasonable timelines all parties could realistically agree upon.

Through this crucial feedback, Nokia was able to design employee support programs that saw employee engagement levels soaring throughout the transitory period, a time when these levels usually plummet. All the R&D programs still in the pipeline were completed in time, too, with excellent results. And the company was able to restore its goodwill as well.

Most importantly, however, this close involvement in the decision-making process, enabled almost all employees to find new jobs, learn new skills, explore new ventures, and keep local communities in all 13 countries thriving and functioning heartily.

3. Help Them Find Another Job Within The Company

If the new technology you’re introducing is going to replace workers, consider it your responsibility to help those workers find other work within the company.

It will not only minimize the stress of finding a new job, but will also help you retain employees who are already trained, enmeshed in your culture, and will make them feel more loyal to the company.

It’s another thing that Nokia Bridge did in 2011 to minimize damages to its workforce.

Company-wide training opportunities were made accessible for employees who were going to be affected by job losses. The training programs allowed them to learn new skills that were applicable in other areas of the company, and many employees were relocated to other teams.

4. Support Ex-Employees’ Startups

It may seem a bit out there for some, but it’s something that has been done by other employers and has proved successful.

If a significant portion of your AI job automation is going to affect high-skill workers, it’s important to learn if any of them have entrepreneurial aspirations so you can be a part of future talent-technology augmentation too.

Again citing the Nokia Bridge example, a major part of their employee transition program was a sort of Dragon’s Den situation. Impacted employees could come up to a select group of Nokia execs who would listen to their startup pitch, and fund their ventures, if the business plan was good.

Through this program, Nokia provided seed capital to many ex-employees who wanted to start their own ventures, and encouraged them to hire up to four other ex-employees in their new businesses.

The strategy accelerated entrepreneurship in Europe, US, and India, and kept a huge stream of ex-Nokia talent employable by the market.

5. Arrange Job Fairs So Employees Could Find New Jobs

What great companies do in times of crisis is take accountability and perform with a stewardship attitude.

The larger your business, the bigger the impact of any layoffs would be when you bring in human-replacing technology. To address it effectively, holding or arranging job fairs sounds like a great help to all employees who will be let go.

In its Bridge program, Nokia not only organized career fairs for its displaced workplace, but went a step further by inviting its local and global competitors, too, to the job fairs so workers could explore more diverse job opportunities.

By bringing the local job market to your employees, you make their job hunting easier, respectful, and improve their chances of finding a job that they’ll love.

6. Set Up Grants And Training Programs So Employees Could Reskill And Upskill Themselves

While high-skill workers may be able to get new job offers left, right, and center, the low-skill workforce you’re letting go will need all the help you can give them.

Set up grants and training programs so employees can start acquiring new skills. Schedule work hours in a way that workers are able to get training during their work hours so as not to impact their wages even more. Offer childcare support options to working parents so they can retrain without having to further juggle their work-life balance.

Remember, before your job fairs could work, or your employees could build stellar startup pitches, you’ll need to reskill and upskill them for the new work reality. Only then you can be sure that they are on career paths that protect their futures, and enrich their lives.


While job automation has always been something that incites fear and anxiety in the workforce, it has also brought many advantages. It makes systems more effective, boosts production rates, improves product quality, eliminates human error, and makes more efficient use of resources.

Yet, for people who lose their jobs to technology, these benefits mean little and less.

To prepare for the future of work — which is going to be an augmented intelligence system consisting of AI and humans — it’s important to address areas where technology replaces human beings. If we don’t, a bias against AI would become part of our workplaces that will prevent employees from interacting with technology and AI in any fruitful ways.

By equipping our workforces with reskilling and upskilling opportunities, we prepare for a tomorrow where employees will be more adaptable to changing work roles, and able to pivot more sustainably into new directions, creating a more reliable employment industry, and a stronge economic system.

About The Author

Kelvin Stiles is a tech enthusiast and works as a marketing consultant at SurveyCrest – FREE online survey software and publishing tools for academic and business use. He is also an avid blogger and a comic book fanatic.