According to a report by the Committee for Economic Development of Australia (CEDA), technology could make almost 40 per cent of Australian jobs, including highly skilled roles, redundant in 10 to 15 years.
Almost five million jobs face a high probability of being replaced in the next two decades, while a further 18.4 per cent of the workforce has a “medium probability” of their jobs being eliminated, the report found.
So what are the “job killers”? As at December 2012, of the 11.5 million Australians employed nationally, about 28 per cent had jobs that involve driving. Of those, more than 3.266 million jobs involve driving commercial vehicles. Forget cute talking home droids, taxis and truck drivers are in the crosshairs of arguably the biggest robot technical revolution. The technology is already here and just a few years from full commercial-scale implementation. We are witnessing a global innovation process involving self-driving cars and driverless mobility.
Don’t for a minute assume that this is still fringe science fiction. Billions are being invested by some of the biggest companies in the world, including Audi, Baidu, BMW, Intel, Mobileye, Bosch, DAF, Daimler, Iveco, MAN, Scania, Volvo, Delphi, Ford, GM, Lyft, Google, Honda, Tesla, Nissan/Renault according to CB Insights.
CEDA chief executive, professor Stephen Martin, says the world is on the cusp of another industrial revolution being driven by technology, and it’s not just low-paid, manual jobs at risk. The report said jobs that involved “low levels of social interaction, low levels of creativity, or low levels of mobility and dexterity” were most likely to be replaced by automation.
The year 2016 may be remembered years from now as the 21st century’s year of great disruption. Look at the political backlash from the ‘rust belt’ that propelled Donald Trump’s victory and the Brexit. Whilst globalization is cited as the key cause, automation is rarely mentioned. It is surprising that amid all the commentary, despite a proliferation in the media of articles recognizing the impending next wave of technological revolution in automation, the political implications have received far less attention.
In a study published in 2013, authors Carl Benedikt Frey and Michael Osborne found that 47 per cent of workers in America had jobs at high risk of potential automation. And this is only the start.
“We are just seeing the tip of the iceberg,” stated Sebastian Thrun, an artificial intelligence professor at Stanford known for his work on self-driving cars. “Recent developments in machine learning will put a substantial share of employment, across a wide range of occupations, at risk in the near future.”
Subsequent studies put the equivalent figure at 35 per cent of the workforce for Britain (where more people work in creative fields less susceptible to automation) and 49 per cent for Japan.
As explained recently in The Economist, there is a growing recognition of “job polarisation” where middle-skill jobs (such as those in manufacturing) are declining but both low-skill and high-skill jobs are expanding. We are witnessing an environment of highly paid, skilled workers on the one hand and low-paid, unskilled workers on the other.
The stagnation of median wages in many Western countries is evidence that automation is irrevocably changing the world of work. We have to ask ourselves what social and political ramifications will ensue when such vast numbers of low skilled, driving jobs disappear as well.
Whilst self-driving cars and trucks will redefine our jobs market, there are other equally disruptive effects. One buzzword of 2015-16 has been infrastructure. Australian governments have established independent infrastructure authorities to help pick winner projects. Trump promised a massive spending boost on infrastructure. This public work is a great hope to tackle future unemployment.
However, a recent report by Telstra demonstrates that autonomous vehicles could save Australia billions of dollars in traffic infrastructure investment. Modelling on conventional vehicles suggests the capacity of the road network, given increasing population and thus increased mobility demand, shows a need to more than double (to 250 per cent) road infrastructure over the next 35 years.
Self-driving vehicles, however, use the road more efficiently and require less road capacity. Based on the assumption that autonomous vehicles will be ubiquitous on roads by 2020 and their adoption will grow linearly until all vehicles can drive autonomously 20 years later, the Telstra study finds that road capacity demands will peak around 2033 at a level 50 per cent larger than today’s road infrastructure and then decline towards today’s road infrastructure levels by 2039.
Whilst the public fumes in traffic snarls and crowded trains today, one can understand why governments are shy about making big project commitments. Why would you build expensive rail when roads of the future may host an orderly caravan of robot cars? Why commit to new roads until the extent of the future disruption is fully understood? Infrastructure planners need to adjust their estimates of road network growth to the advent of self-driving cars. This technology will enable governments to reduce road infrastructure spending by billions of dollars.
An additional factor is that autonomous vehicles are anticipated to increase use of mobility-on demand services (think Uber, without the driver, summoned by your phone app). This will dramatically change the distribution of trip patterns during the day and increase ride sharing in various forms. Both effects will further reduce the peak load on our roads.
Regulators are getting on board. The National Transport Commission has recently released details of a series of regulation changes related to autonomous vehicles that will roll out over the next two years – including removing regulatory barriers in Australian Road Rules and other transport laws that “assume a human driver.”
Other rule changes include developing national guidelines to support automated vehicle trials, clarifying who is in control of a vehicle with different levels of driving automation and developing a “comprehensive performance-based safety assurance regime” for increasingly automated vehicles. Their goal is to have conditionally automated vehicles operating safely and legally on our roads before 2020, and highly and fully automated vehicles from 2020.
In light of this, many experts are suggesting that, given the implications of self-driving cars, rather than investing in concrete and asphalt, governments should accelerate the adoption of autonomous car technology today. Professor Alexander Hars of University of Bayreuth last year demonstrated that this innovation will lower accident rates, reduce the ecological footprint of mobility and increase the competitive position of first-adopter countries.
Whether we are on the verge of a precipice or at the foot of a rainbow depends on your perspective. The unions are well aware of the potential disruption, with the Transport Workers Union making representations on issues of safety and jobs. But this is probably just a finger in the hole of a crumbling dyke and, like the advance of other recent technological revolutions, cannot prevent the unstoppable flood.