In the next ten years, the use of robots in manufacturing, and even in small business, is expected to skyrocket. According to the Boston Consulting Group (BCG), the total investment in industrial robots will accelerate quickly by 2025. The annual growth of the industry, which currently averages between 2% and 3%, is expected to climb to over 10% within the decade.
BCG predicts that advanced-manufacturing robots will diminish the cost of labor by 33% in South Korea, 25% in Japan, 24% in Canada and 22% in the United States. Currently, robots have only taken around ten percent of the present “automatable” jobs. By 2025, that figure is expected to raise to 25%.
Part of the reason for the projected growth of robot use is that even the most advanced technologies are finally reaching a reasonable price for manufacturers and factories. For instance, BCG reports that the cost of purchasing and operating an automatic spot welder has fallen from $182,000 to $133,000 in the past ten years, and is expected to continue getting cheaper. While it only costs some $8 per hour to use robo-welders, human welders usually require an average of $25. The advantages that accompany a robotic workforce are apparent. Business owners, particularly those involved in production and manufacturing, are naturally attracted to the vast reduction in labor costs that come with shifting to robotic workers.
The Chicago Tribune mentions that one of the biggest perks of using advanced robotics is that they are immediately reprogrammable, should the nature of their job change. This gives them a leg up on human workers, who need to be retrained when facing a new task. According to American Express, many predict that the low cost of labor will revive the American economy, and prevent industries from relocating to foreign countries in order to escape taxation. It is even possible that many companies who have already fled will consider “reshoring” their headquarters to American soil.
While these advances in robotics will obviously benefit owners of manufacturing companies, and the national economy as a whole, American Express claims that the small business sector will also be able to profit from the upcoming innovation. As the industry continues to progress and advance, the price of robots will continue to plummet. Many small businesses can purchase robots that are fitted for their industry for as low as $20,000.
While the news of automated labor is good for many, it also leaves millions of workers wondering how they will fit into the economy of the future. Historically, technological innovation has always eliminated manual labor, but the concern is that innovation is occurring so rapidly that the average worker will not be able to keep pace. The Harvard Business Review forecasts that by 2025, labor-robots will have a higher IQ than 90% of the American population. So, what can the humans do to keep themselves relevant? As of now, the answer seems to be increased the education/training of the average worker. Investing in America’s human capital will help the labor pool transition to IT professions that will fuel the inevitable automated workforce of the future.
Thankfully, manufacturing jobs remain and so does demand for top talent. If you own a growing manufacturing company and could use a boost in working capital, discover how invoice factoring for manufacturing can help.