Tuesday 19 March 2019

Brendan Keenan: 'Towns face uncertain future as march of the robots gathers pace'

Attendees take smartphone photographs of humanoid robot ‘Sophia’ at Barcelona’s MWC – research has found some towns could lose almost 60pc of jobs to automation. Photo: Bloomberg
Attendees take smartphone photographs of humanoid robot ‘Sophia’ at Barcelona’s MWC – research has found some towns could lose almost 60pc of jobs to automation. Photo: Bloomberg
Brendan Keenan

Brendan Keenan

A shrewd observer once noted that probably the two most successful organisations in the country are the GAA and the Tidy Towns competition. What they have in common is that they are largely volunteer-driven, and are intensely local.

Old romantic that I am, I see in this one of the last traces of the Gaelic world, a world that is not long gone in historical terms. In that world, what you were depended largely on where you were born.

Even if it is in the blood, and despite the success of those organisations, the general response to Irish localism is one of criticism. It is often ascribed, not to our own past, but to the imposition of foreign government.

Sometimes there is the suggestion that it is a sign of backwardness. The Lord Deputy would have agreed with that. None of which would matter very much, except that going against the grain of national character by aping the policies of former feudal monarchies may explain some past failures.

There were successes too. The dispersal of IDA factories around the country in the first 40 years of the inward investment strategy was one. As was mentioned in last week's column, weaknesses in the economy have shown up more in differences between workers rather than regions.

The world of those decades has largely disappeared and a new one is evolving before our eyes, but in ways which were not foreseen with a future which is unpredictable. There will certainly be difficulties but new conditions may provide an opportunity to find an Irish solution to our slice of this global problem.

Localism meant lots of interest was generated by the report from University College Cork on the threat to different towns from the expected growth in automation and artificial intelligence.

Even more compelling was the finding was that some towns were going to fare worse than others. That sort of thing really does get people going. It also highlighted a particularly difficult political challenge; that different towns will need different sets of policies.

The analysis by UCC's Spatial and Regional Economics Research Centre found the number of jobs at high risk from automation ranged from a low of 26pc to a high of 58pc in different towns. More surprising was the conclusion that many low-risk towns have high-risk towns nearby, and vice-versa.

Overall, the paper found that 40pc of jobs may be in danger. This is in line with the research which put this issue in the headlines, the Frey and Osborne paper of 2013. It concluded that almost half the jobs in the USA could be lost or affected and a third in Britain.

It is a new take on a very old issue. The great Keynes himself had his concerns, fretting that technology might rave ahead of workers' ability to adapt. That was 80 years ago. While he was right about the technology, which has advanced more than he could have imagined, mass unemployment did not appear. On the contrary, unemployment in the US is at a 50-year low.

Many critics of the new worries point to the notorious Luddites, who destroyed textile machines in the 19th century. Employment and populations soared as the mechanical revolution took hold. But the hand-loom weavers did lose their jobs.

The problem in future may still be one of change and adaptation rather than masses of people without work. Change may well speed up with developments in artificial intelligence. The concern is that, even if new jobs are created, they may not be as skilled and well-paid as the ones which are gone.

This was a central point in another piece of research on the subject last week. It came in the spring quarterly of the trade union-backed Nevin institute (NERI), which also had a quite different take on how to assess the risk than the UCC document.

There is another local angle here. The trade union movement being an all-island one, the NERI report is on Northern Ireland, a region whose economy, the institute has pointed out in the past, is hampered by poor skills and low productivity.

Its task-based analysis finds jobs are in less danger than the mainstream methodology does. Just 7pc are at high risk of disappearing as a result of automation, although a further 58pc face substantial change in the tasks involved and only 13pc look likely to escape entirely.

This seems more in keeping with historical patterns than mass, permanent layoffs. The calculations are that there will be enough new jobs created to replace lost jobs. But that is only part of the story.

The new jobs created will often be quite different from those lost. Even where they merely change, they could indeed be less skilled, and therefore lower paid. It can be misleading to think of them as replacement jobs, the authors say.

More than a quarter of those in the distribution, hotels and restaurant sector are at high risk of automation and a further 46pc are at mid-to-high risk.

As with other studies, this one finds that risk in general is highest among low-skilled workers, with a third facing possible extinction of their jobs.

Even among middle-skilled workers, 40pc face substantial change in the structure of their job, as some tasks become suitable for machines. In a subtle change, which the report says is already under way and will accelerate, the workforce polarises between high and low skills, as the middle sector shrinks in relative size.

Growth concentrates at one end in non-routine cognitive, high skilled occupations such as engineers, and at the other in non-routine occupations such as caring and leisure services.

The same patterns can be seen in the UCC report, even if the numbers differ. The authors point out that they use estimates for the value of jobs and the exact numbers thrown up by the exercise should be treated with caution.

But it is the patterns which matter. There is no denying the fascination of seeing them displayed at the level of individual towns, some as small as 1,500 souls. Nothing quite like this has been done before and so we see that Carrick-on-Suir and Clones are among the most threatened towns, and Strandhill and Annacotty among the least.

I mention those two because all the others in the best 10 are satellites of Dublin. The expected changes add another dimension to the difficulty of balancing the Dublin region with the rest of the country.

This is exacerbated by the somewhat unexpected finding that agriculture is one of the industries where jobs are most at risk. One might have thought the automation of farming took place more than a century ago but, along with manufacturing, more change is on the way.

Towns with significant employment in health and support services, public administration, accommodation and food, construction and wholesale/retail trade are also less exposed.

In a parallel with middle-ranking jobs, middle-ranking towns may fare worst too. Those with fewer than 5,000 inhabitants or more than 10,000 are in less danger than those in-between.

On the other hand, any town far from a large urban centre faces greater risks than those which are less remote.

A one-size fits all solution is clearly not the answer. Insofar as national policies might help, NERI emphasises more collective bargaining and legal protection of workers, while the UCC paper thinks Ireland's multiple universities could spread their benefits better into surrounding towns.

All agree that more flexible, accessible education and training facilities are needed to keep up with technological change but the UCC analysts say the unexpectedly wide spread of risk among towns points to the need for local initiatives.

These will have to be devised locally to meet the different challenges to different towns. Another new analysis - from the ESRI on policies to help disadvantaged groups - showed how difficult it is to make a clear success of such efforts.

The plethora of policies from every kind of quango and agency made it impossible to know what was working and what was not. The grassroots approach of the GAA and Tidy Towns shows that local can work and when it works, it works very well.

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