Japan’s robot revolution will impact US jobs

TOKYO — While visiting Japan and interviewing officials on the robotics revolution that is sweeping much of Asia, it became clearer than ever to me that President Donald Trump’s plans to bring back low-skilled manufacturing jobs to America are a political illusion.

Trump should take some time off from the golf course and visit this part of the world, where he would see how fast Japan, China and South Korea are developing their robotics industries. They are replacing massive numbers of workers with ever faster, more efficient and cheaper robots, and the United States will have to do the same to remain competitive.

If Trump goes ahead with his plans to clamp down on US free trade agreements with Mexico and other lower-wage countries in order to bring these jobs back to America, he will be wasting his time. These jobs will never go back to American workers. They will go to robots.

In Japan, which already is one of the world’s top producers of robots, Prime Minister Shinzo Abe is carrying out a $1 billion, five-year plan to turn this country into a “robotics superpower.” The plan calls for creation of new industrial and service robots, and for quadrupling the country’s production of robots by 2020.

Japan has a powerful reason to bet heavily on robots: its labour force is declining rapidly. Japan has one of the world’s lowest birth rates, its population is aging, and the country has highly restrictive immigration policies that it doesn’t want to change.

“We need robots, because we have increasingly fewer workers,” Atsushi Yasuda, director of the Ministry of Economy’s robotics department, told me. “We have 76 million working-age people today, and by 2025 that number will go down to 70 million.”

Unlike Americans, the Japanese are not worried about robots taking their jobs. On the contrary, they seem to have a love affair with robots. You see robots at the entrance of many department stores and shops, greeting customers and giving them directions.

Japan also sees robots as a solution to its elderly care problem. Twenty-six per cent of Japan’s population are senior citizens, and they are projected to reach nearly 40 per cent of the population in 2040. Foreseeing a major shortage of retirement home workers, Japan is developing robots to assist and provide company to the elderly.

But what’s going to have the biggest impact on the US and world economy is the growing production of industrial robots.

These are the type of machines that perform the routine jobs at car manufacturing plants that Trump wants to bring back to the United States.

Like Japan, China and South Korea are also investing heavily in industrial robots, anticipating that their rising wages will make them uncompetitive unless they automate their manufacturing plants.

Today, the cost of a human welder at a US manufacturing plant is about $25 an hour, including benefits, while the equivalent operating cost per hour for a robot is about $8, including installation, maintenance and amortization over a five-year period, according to a Boston Consulting Group study. And the gap will widen further as robots become more efficient and cheaper, it says.

Another study by the Center for Business and Economic Research at Ball State University says that 88 per cent of US manufacturing job losses in recent years were due to technological changes, and not because of trade with Mexico or China.

My opinion: Trump is wasting his time trying to renegotiate trade deals with Mexico, China and other countries that he says are siphoning away US manufacturing jobs.

Those jobs, which have already fallen to less than 10 per cent of US jobs, are gone for good. They are following the path of US farm employment, which went down from 40 per cent of all US jobs in 1900 to 2 per cent a century later.

Instead of trying to resurrect the 1950s world in which he grew up, Trump should spend his energies in improving education and training to produce the high-skilled workers that will be needed to operate the new generations of robots, and who will get better jobs in the new knowledge economy.

Asian countries are doing that at full speed, and America will fall behind if it doesn’t do the same.

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