American workers are locked into their homes, avoiding contact with anyone and everything touched by others. Social contacts and supply chains are disrupted by coronavirus and the COVID-19 illness it causes. In the workplace, there is a solution that addresses both problems simultaneously: new colleagues immune to pandemics and ready to replace American workers.
While many bosses are discovering a new willingness to let at least some employees permanently work remotely, no one seems to be talking about this 800-pound gorilla that could be even more disruptive to jobs and could happen even faster than the already quite scary forecasts of only a few years ago.
Even more automation with ever-more-powerful robots and computers can help immunize the economy against future pandemics. This has implications in particular for two industry groups that have come into focus recently: essential industries, including large parts of the manufacturing supply chain, and industries with direct customer contact, also called high-touch industries. Note that these categories overlap: for example, about half of the high-touch industries are considered essential.
A widely cited 2017 study out of Oxford University provides data to calculate the share of jobs that can technically be automated in the next 15 years. Using this study, I calculated employment and wage risks for those industries. About 54% of all jobs in the U.S. are in industries classified as essential by the Department of Homeland Security, and 67% of these jobs — corresponding to 52% of wages — are susceptible to automation. So it is the low-wage jobs, like retail and warehouse jobs, that face the highest risk. In comparison, high-touch industries account for 46% of jobs (with some overlap with essential industries), and 57% of those jobs are vulnerable.
Recall what social distance requires: don’t meet, don’t touch. That particularly affects some high-touch industries like restaurants, retail and recreation. According to the same Oxford study, we should have the technology to automate 86% of restaurant jobs, 76% of retail jobs, and 59% of recreation jobs by 2035.
Two years ago, I argued that many of the jobs with direct customer contact would likely not be automated as customers value personal contact. However, COVID-19 is a human tragedy, and research has shown that those affected severely will permanently change their behavior. This means that certain customers at any time and almost all customers at certain times will value avoiding personal contact. That changes the mix of preferences and restaurant offers substantially.
As especially large companies consider rehiring, they will think twice whether a particular job can be done by a machine. Robots are getting more capable by the hour and cheaper by the minute. Cost advantages are going to be reinforced by…