Technology has evolved to become what it is today—an integral part of human existence. And, while technology benefits society in many ways, its increasing sophistication will likely put a broad set of jobs at risk.
Case in point: Automated systems have begun to replace humans, or help reduce the work load, in many industries. These automated systems or robots have long been an area that many tech giants have been exploring. Below are two examples:
- For years, e-discovery software has helped lawyers manage the electronic records that need to be produced at the beginning of an investigation or law suit—a job originally done by clerical assistants.
- Fast-food giant Wendy’s announced that it would replace cashiers with automated kiosks for taking customers’ orders at its restaurants.
Recent developments in the fields of artificial intelligence (AI) and robotics have led many experts to believe that they could help solve productivity gap issues, where they exist. At the same time, this could mean more white-collar jobs could be lost to AI enabled robots. According to Forrester market research, the number of job cuts attributed to robotic automation in the U.S. could grow to 12 million by 2025. White collar jobs most likely to be affected are in customer service and office administration; areas where fresh graduates are most likely to apply for entry-level positions.
Bottom Line for Investors
For centuries, new technology has resulted in swaths of jobs becoming obsolete. However, new and evolving technology has also created jobs as well. Case in point: after analyzing 140 years of data, a study by economists at Deloitte reported that technology has created more jobs than it has displaced since 1871.
Still, a major concern is the pace at which technology is advancing. In some economies, like the U.S., the recovery phase may be slower than is ideal. This begs the question, will new jobs be created fast enough to replace those displaced by technological advancement? We shall see. Regardless, investors are encouraged to remain aware of the balance between technology innovation and employment trends as the state of both can impact investments.
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