Businesses all over the world are beginning to realize the benefits of replacing human laborers with machines that can perform the same tasks. Automation has the potential to both boost productivity and cut down on labor expenses. It makes it easier for employers to steer clear of difficult challenges, such as wage increase demands, labor protests, and strike action. When automation results in cheaper goods and services due to reduced input costs, consumers are also able to reap the benefits of this trend.
However, even though there are a great number of advantages to automated systems, the latest economic trends in the developed world imply that it may also be a primary factor in the rise of economic inequality.
There is a growing body of academics and thought leaders who are sounding the alarm that the recent spate of technology advancement could bring about a change in the relationship between labor and capital on a scale that has never been seen before.
It is important to note that these contemporary Luddites are not inherently opposed to the use of technology. Their primary concern is the way that increasingly sophisticated technologies contribute to widening economic disparities. It accomplishes this by devaluing low-skilled labor and by carving down the working class, as is demonstrated by trends in productivity and the median household income in the United States.
There have only been a small amount of research done on the potential effects that automation could have on economies in developing countries. This is what got me interested in learning more about the situation in South Africa. We used an automation index developed by scholars from the University of Oxford as well as evidence obtained by Statistics South Africa for its Quarterly Labour Force Survey. As a result of this, we were able to conclude that the jobs held by approximately 4.5 million South Africans, which account for almost 35 percent of the country’s workforce, may be susceptible to automation in the not-too-distant future.
However, it would appear that the nation is not ready for this fact. At the level of policy, there is very little discussion. A very little investigation into the various possible outcomes of the future has been carried out. There is also a significant amount of uncertainty regarding how the adoption of automated systems may further influence inequality and maintain the asymmetry that currently exists in the economy of the country.
Putting the Data Into Context
Already, our country’s economy is considered to be one of the most unequal in the whole world. The rate of unemployment there is consistently around 27%. Automation is also not a stranger to labor protests and strikes, which makes it an attractive choice for managers and owners of capital.
According to the data, there are approximately 380 different occupations that employ a total of approximately 14 million people in South Africa. There is a 90% or greater chance that 64 of these occupations will be automated in the not-too-distant future. Together, these 64 occupations employ an approximated 3.6 million people. Cashiers, tellers, secretaries, and people who sell things over the telephone are all examples of these types of workers.
There is a possibility that automation could replace the jobs of another 2.6 million workers, of which 900 000 are farmhands and laborers. The likelihood of this occurring ranges from 80% to 89%.
Employees of All Skill – Sets Are at Risk
The jobs of accountants, auditors, and dental technicians all require a high level of expertise, and there is a significant risk that these jobs will be automated. Currently, taxpayers in the United States can make use of a variety of automated tax preparation services.
However, current trends suggest that people whose jobs require only a high school diploma or less are typically more at risk than those whose jobs require a college degree or more.
Therefore, it should not come as a surprise that the population groups in this country that have historically been at a disadvantage are more likely to be affected by job losses caused by automated processes than their white counterparts. 47% of colored workers and half of all black workers in South Africa are employed in jobs that have a probability of automation of 80% or higher or are already fully automated. However, only about 30 percent of workers who identify as white fall into this category.
These disparities are illustrative of how technological progress preserves the status quo by giving an advantage to workers with specialized skills and those who have the financial means to pursue higher education.
Despite these consequences, it seems probable that as an ever-expanding spectrum of automation appears on the market, many South African company owners will profit from the chance to restrict their reliance on human labor. This will occur as a result of an increasing number of automated technologies being introduced into the market. This will have a detrimental impact on an economy that is currently fighting an uphill battle to grow and create new job opportunities.
Our Country isn’t Prepared
Nevertheless, there appears to be a very limited amount of high-level discussion about just how South Africa intends to navigate the movement of technological development.
In another part of the world, Andrew Yang, who is running for president of the United States in 2020, is centering his entire campaign on this particular issue. He has committed to enacting Universal Basic Income, a program through which all adults in the United States who are over the age of 18 will receive a monthly payment from the government of USD 1000. According to him, this will offer protection and make it possible for workers to move freely after their jobs have been automated.
Several nations in Europe are also in the process of conducting large-scale experiments with a universal basic income to investigate the possibility of using it as a response to the rise of automation.
Because South Africa has a large population of workers with low levels of education, dramatically improving the school system is an evident and essential concern for the country. Despite the high unemployment rate, there is still a severe shortage of expertise in a wide range of different fields. This indicates that the supply and demand in the labor market are not aligned properly.
In addition to this, it is necessary to have an understanding of how technological advancements will eventually displace work. This comprehension can assist in better informing the career choices that young people in South Africa make.