Artificial intelligence (AI)-driven automation is increasingly going to mean that computers, machines and smarter algorithms replace jobs.
While this is certainly not only relevant to Taiwan, it will have specific impacts because of the nation’s export-driven economy and industrial models.
As machines take over certain jobs, humans are going to have to stay ahead of the curve and carve out new niches.
The key will be training and learning new skills, and there is no time like the present.
According to a January 2016 report published by the University of Oxford entitled Technology at Work v2.0: The Future Is Not What It Used to Be, the hardest-hit sectors in developing nations will include manufacturing, marketing, agriculture and fisheries.
These are important sectors in Taiwan.
The transformation has already started happening.
On Feb. 6, Innolux Corp, the world’s No. 3 LCD panel maker, reported that it expects to automate 75 percent of its production lines by the end of the year and will cut its staff to 50,000 this year from 100,000 in 2007, when the automation program was initiated.
It is not just the numerical loss of jobs; AI-driven automation also has the potential to severely disrupt the whole operating model of mass-manufacture factories and original equipment manufacturers (OEMs).
Taiwanese industry still relies on this model, even if many of its factories have relocated to China.
The reason that US and European companies outsource manufacturing to factories and OEMs in Asia, including Taiwan and China, is because of the lower labor costs, allowing those companies to keep costs — and therefore product prices — down.
If tasks are carried out by smart robots, communicating and learning through cloud connectivity, local labor costs are taken out of the equation.
The argument for outsourcing these processes to plants in Asia is therefore much reduced: What is there to prevent US and European companies setting up factories in their own nations?
Aside from the economic argument, there is also a political one, especially in the age of US President Donald Trump and his campaign promise to repatriate US jobs.
That is going to lead to a transformational shift in the manufacturing business model in Taiwan.
It is going to happen quickly. The government and companies will have to introduce measures with urgency.
While a simplistic reading might be that this is good for Taiwan as the population is shrinking, the nation’s demographics are unfavorable.
According to a National Development Council report from 2016, titled Population Projections for Republic of China (Taiwan) 2016-2060, Taiwan will be a “super-aged” society in 2040, with a top-heavy working population of the population pyramid.
That is, workers in the 40-to-64 age group will significantly outnumber those in the 15-to-39 group.
Younger workers tend to absorb skills and newer technological paradigms better than those who have already been working for 10 or 20 years.
However, it is not all bad news.
The potential for automation to render certain jobs obsolete does not necessarily mean that there will be fewer jobs.
It means that human creativity, interaction, discernment, judgement and empathetic capabilities will become more important in the supply chain in which the machines are taking over repetitive tasks.
Also, as technology frees people of certain jobs, it gives them more time to look to new exploits, new products, new sectors and new jobs, and these will create new jobs and drive economic growth.
We are in the process of adjusting to a new industrial revolution. There is a lot of work to be done — by companies and the government — to move in the right direction.
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