As worker demands rise, companies embrace automation

OPINION:

“I want more time off!”
“It’s just not right that I have to return to the office!”
“I’m getting bullied at work!”
“I want to be paid a FAIR wage!”

Higher minimum wage. Unlimited paid time off. More overtime rules. Greater power to unionize. Extended unemployment. 

It’s the year of the worker! With Democrats in control of Congress and the White House, businesses like mine are seeing more rules from the Labor Department, additional funding for OSHA and the EEOC, and more legislation proposed that will significantly increase our compensation costs over the next few years. 

Democrats are saying this is good for workers.  But is it really? 

As more workers refuse to come back to work, their employers are getting fed up.  A third of small business owners say that they’ll fire those workers. When more demands are made, more businesses are doing what businesses do: They’re simply replacing workers with machines. This means those same people that don’t want to come back to their jobs, insist on being paid a “fair wage,” and who complain about their employers are now finding themselves without any wages at all.  

Don’t believe me?  Let’s look at a few examples.

There’s the restaurant chain Dave & Buster’s, who recently announced that its locations are using contactless ordering, a move that has allowed them to “expand the size of server sections and reduce staffing levels to be more efficient.”  McDonalds is testing an automated, voice-recognition-based drive-thru ordering system at ten of its Chicago locations to reduce the number of orders that workers have to complete. Delivery service GrubHub is rolling out robots to deliver pizza across 250 colleges in the U.S.  Miso Robotics is selling lots of its “flippy” robotic arms, which can make everything from burgers to sushi.

On the shop floor, autonomous forklift manufacture Seegrid has seen its revenue double in the last year because of the demand from manufacturers to reduce labor in their warehouses. 

“Business is good. I’m bullish on this year and the next five years,” said the company’s CEO. Boston Dynamics in March released its Stretch Robot, a $75,000 machine that packs, parcels, loads, and moves materials…and doesn’t need health insurance.  Google is building industrial robots with the primary purpose of replacing people.

The Wall Street Journal reports that Kenco Logistics Services, a Tennessee-based logistics provider, is “rolling out a fleet” of self-driving vehicles to “bridge a labor gap by helping workers fill online orders.”  The report says that the company is also testing autonomous tractors that tow carts loaded with pallets. 

Meanwhile, companies like Inceptio and Maven are working on autonomous, self-driving trucks that don’t require downtime, don’t drink beer, are safer, and save energy too. Retail giant Kroger is testing drone deliveries in Ohio.  

Tech company Adobe is updating its document signing process to limit human interaction. Other tech companies like Microsoft, Salesforce, and Facebook invest billions in automated intelligence tools in allowing their systems to interact with customers through text and email without involvement from customer service people. Amazon is introducing thousands of self-service grocery stores manned by a skeleton staff to restock shelves…until robots eventually replace them. Airport retailer Hudson is using Amazon’s technology to automate its own locations.

Roofer Bryan DeHenau says that his company is “already automating lots of tasks in the roofing process” and that each form of automation eliminates about four laborers. A Yahoo News report confirms that The Pennsylvania Turnpike has already eliminated toll collection by hand and switched to a cashless electronic system. Yahoo News also reports that consumer products giant Procter & Gamble have “found that strategically adding robots to its assembly lines made it possible to keep more workers on the job — and produce more goods — while complying with social distancing guidelines.”

It’s not just businesses that want to limit their employee headaches.  It’s consumers too. Eighty-five percent of the respondents to a survey conducted earlier this year from customer experience platform Raydiant said that they believe that self-checkout options are faster, and 60 percent of consumers in that same report said they preferred self-checkout over checkouts.  

A report from the National Bureau of Economic Research says that 50 percent to 70 percent of changes in U.S. wages since 1980 can be attributed to wage declines among blue-collar workers who were replaced or degraded by automation.  That trend is not only accelerating but creeping its way into middle management too. 

Most companies will tell the public that their automation initiatives are for “productivity gains” and are not designed to eliminate employees. They’re lying. But can you blame them? No. 

So to the workers and their political representatives in Congress, I say be careful!  Watch out!  You may think your demands are going to benefit you. But all they’re doing is motivating us to use technology to replace you.

• Gene Marks is a CPA and owner of The Marks Group, a technology and financial management consulting firm specializing in small- and medium-sized companies.