Are robots coming for our jobs in San Francisco?

Middle-income workers assigned repetitive tasks are most at risk

Much ado has been made about the potential new Amazon warehouse in Mission Bay proposed in November. Every day, approximately 500 employees would come and go from the site, which was originally slated for housing, with many traveling in cars that could cause a spike in traffic. Some neighbors worry the mostly low-wage workforce will overwhelm the community while spending little in the local economy.

But absent from many of these discussions is the possibility that in 10 to 15 years, the workforce populating the 900 7th St. facility might be a whole lot smaller. That’s because a lot of the repetitive tasks performed at the warehouse will be taken care of by robots, spelling an uncertain future for the approximately 500 jobs it’s slated to offer.

According to a frequently cited 2017 study from the McKinsey Global Institute, only about 5% of jobs can be fully automated. However, in 60% of jobs, 30% of tasks will be automated by 2030. Some studies say that will create a wave of job losses, while others picture a slower pattern of attrition as the current labor force retires and leaves to other sectors. A few local technologists say all of this research is overhyped, and the prospect of robots replacing labor is too far off for accurate predictions.

Academic research has projected a dire outlook. A 2020 paper from MIT and Boston University estimated as many 2 million manufacturing jobs could be automated away by 2025. Repetitive activities such as price scanning, cash counting and simple phone calls are also prime for automation, extending the potential impact to retail, food service and customer service jobs, too. In a 2020 World Economic Forum survey of 300 global companies, 43% said they expected to replace some labor with technology.

But economist Zheng Liu , who is vice president of international research and director of the Center for Pacific Basin Studies at the Federal Reserve Bank of San Francisco, describes more of a two-phased process. First, as robots get cheaper, he says, they will slowly take over more tasks currently assigned to human workers — mostly middle-wage workers, he says, because it will be some time before a robot is cheaper than minimum wage labor. Then, the productivity of these companies will increase, leading them to actually hire more workers, at least initially.

However, robot technology hasn’t evolved enough for San Francisco to even be in that first phase, Liu says. Rather, his research suggests it might be the prospect of future automation that most impacts workers today. “Workers have weaker bargaining power when they ask for raises because the firms could always go the other way and adopt a robot, or offshore,” Liu says.

Officials with the Federal Reserve Bank of San Francisco believe automation has a role in keeping wages down, as seen in this image from a <a href="https://www.frbsf.org/our-district/about/sf-fed-blog/video-job-automation-keeping-down-wages/" target="_blank">video</a> produced by the bank. (Federal Reserve Bank of San Francisco)

Officials with the Federal Reserve Bank of San Francisco believe automation has a role in keeping wages down, as seen in this image from a video produced by the bank. (Federal Reserve Bank of San Francisco)

Two of the co-founders of Berkeley company Ambi Robotics, David Gealy and Stephen McKinley , argue the whole debate should be reframed. It’s not about replacing humans with robots, they say, but making warehouse work more efficient and safer. Their company is considered one of the most advanced in making robots for the e-commerce industry — so much so that Amazon founder Jeff Bezos once tried to acquire them.

For one, they say humans are needed to work with their robots, which they prefer to call “AI-powered systems,” to emphasize the collaborative environment between their inventions and workers on the assembly line. Second, they point out their robots take on tasks that are never physically healthy for a human to do, such as repeatedly bending over to pick items up out of a bin, twisting at the torso and then placing the items on an assembly line. Third, the founders say technology skilled enough to fully replace people on an assembly line is too distant a prospect to even be considered.

McKinley says he often finds himself trying to explain this point of view to people. “I feel like they’re imagining a C-3PO coming in and being like, ‘Hello, David, here’s your replacement, it’s just a robot version of you, and you’re no longer needed,’” he says. “I understand why that’s kind of terrifying and inhumane, but that’s definitely not the reality of the world of automation.”

Ambi Robotics’ machines are unique in that they can pick up and move objects varying in size, shape and texture using AI, and learn quickly. Additionally, whereas most roboticists in the field teach their artificially intelligent machines using real-world practice, Ambi’s robots learn much more quickly via digital simulation.

Pitney Bowes, the company that manages shipping for companies such as eBay, Gildan Brands and World Wrestling Entertainment, is one of their clients. And McKinley and Gealy point out Pitney Bowes increased wages for workers $3 to $5 an hour this holiday season as proof that the company’s use of Ambi robots isn’t worsening workers’ lot.

There’s some data to support what McKinley and Gealy say about robot automation being fairly far off. Proprietary data Liu receives from the International Federation of Robotics says the average cost per industrial robot newly installed in the United States decreased from approximately $75,000 in 2002 to $59,000 in 2016, the latest year reported. Though Ambi doesn’t disclose its prices, it’s safe to assume the company’s cutting-edge tech isn’t the cheapest on the market. With a full-time minimum wage salary in San Francisco coming in at about $32,640 a year, labor is typically a better investment for companies, morality and employee morale aside.

“We’re not seeing widespread robot adoption at this point,” Liu says. “We just see the cost coming down.”

virwin@sfexaminer.com

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