Chris Middleton reports on why organisations need to take a more mature view of Industry 4.0 technologies, despite the negative media coverage.

Hardly a month goes by without a report being splashed by the UK media suggesting that robotics, automation, and artificial intelligence (AI) will sweep aside human jobs. This week, for example, newspapers have been shouting about a new Oxford Economics report which suggests that 20 million manufacturing jobs could be replaced by robots and other Industry 4.0 technologies by 2030.

Countless similar reports have been published over the past decade, all taking the line that smart machines are job killers and a threat to the human race. The problem is that such stories are more informed by science fiction dystopias than economic realities. At best, this kind of media coverage deals with half truths, or omits critical details from the source research – while airing points of genuine concern.

For example, in 2018 an in-depth report on the future of jobs from the World Economic Forum found that robotics and AI would indeed make some business functions redundant for human workers – including low-skilled manufacturing jobs and once-safe junior positions in financial services, the law, accounting, and administration. However, the world economy would experience a net gain of 58 million jobs, as Industry 4.0 technologies create new roles, companies, services, opportunities, and growth – just as e-commerce and mobile devices have over the past quarter century.
It’s not a case of one robot in, 15 humans out. In 2015-16, US manufacturers purchased 60,000 industrial robots, but according to the International Federation of Robotics (IFR), 250,000 human jobs have been created in, or brought back to, the US manufacturing and supply chain sector since then. Meanwhile, PwC analysis of US Bureau of Labour Statistics data finds that the most robotics-intensive manufacturing sectors in America (automotive, electronics and metals) employ 20 percent more mechanical and industrial engineers than other manufacturing sectors, and pay them higher wages.

The battleground in the future won’t be employment in simple terms, therefore, but employability: having the right mix of skills and knowledge to move sideways or up, or try something new. That’s no small challenge for many workers, of course, and putting in place a culture of lifelong learning and retraining is essential, at both national and organisational level.

So what about AI specifically? What are organisations’ attitudes to the influx of new applications that are designed to speed up and augment human decision-making – and perhaps power the new generation of robots? A new report, Artificial Intelligence on the Horizon, by Headspring Executive Development – a joint venture between the FT and IE Business School – looks at business attitudes to AI.

Humans still trust humans more than machines, finds the report, and trust in human decision-making is highest among C-level executives. More than half of office workers would trust a decision made by a human more than a decision made by AI, while 27 percent would trust them the same. Less than one-fifth would trust an AI’s decision over a person’s.

Some of the results show apparently contradictory reactions. For example, among professionals the strongest association with AI is that it creates systems that will replace human jobs – echoing those negative media reports – yet fear of AI-related job redundancy is rare, at less than 10 percent. However, the second most widely held belief about AI is that it will help people make better decisions – despite the lack of trust in AI decisions exhibited in previous answers.

The impression is that people are in a transition phase over their attitudes to these technologies, with many still influenced by negative media coverage. That said, employees see themselves as more prepared for the new machine age than their employers – or perhaps they feel that it will replace someone else’s job, not theirs.

In the UK, where media coverage of new technologies is generally hostile, attitudes to AI are unsurprisingly negative compared to other countries in Europe. Fifty-five percent of UK respondents acknowledge that they know little to nothing about AI and only two percent believe AI will help people’s career prospects. Over half trust human decisions over AI, with two-thirds of senior executives feeling this way. One hundred percent of UK CEOs have greater trust in people than machines.

“In the UK, AI is showing high penetration rates and confidence in the financial services sector, but low awareness and trust in the pharmaceutical and healthcare industries. Seniority and industry are the most influential factors in predicting a UK professional’s attitude to AI,” says the report.

“By contrast, German CEOS are the least AI-engaged of European business leaders and the least enthusiastic about its potential impact. Only eight percent of German office workers feel that AI might make their job roles redundant, though more than double that number of financial services workers believe so.

“Almost two-thirds of French office workers know a lot or a fair amount about AI, with a notable discrepancy in gender (67 percent of men claim high levels of knowledge, against only 53 percent of women). Unusually, the age group most likely to know about AI is 55 years or older.

“This may correspond with the high levels of knowledge found in senior leadership. France has the highest proportion of CEOs who know a lot about artificial intelligence, and French CEOs are the most positive of all about their ability to work with AI. Eighty-four percent currently use or feel prepared to use the technology within the next 12 months. Only 29 percent of general employees feel the same.”

The older the professional, the less likely he or she is to work with AI currently, says the report. The younger the candidate, the higher the employee’s feeling of preparedness for incorporating AI into his or her role. Twenty-nine percent of 18-24 year-old’s feel ready to use AI within the next 12 months.

Chief executives and other senior role players tend to diverge sharply from consensus. No CEOs, for example, agree with the quarter of respondents who think that implementing AI will reduce the number of people in their department.

So at present, it seems, business leaders’ loyalties remain with their human staff.