Is the Tech Evolution Causing World Poverty?

Nowadays, individuals who embrace learning as a way of professional development, and possess a few different skills in a few different professional areas, are referred to as growth hackers. Such individuals have something valuable to offer to the current labour market. Thanks to the growing trend of owning a company, funding a start-up, or launching an innovation, such individuals’ skills are much welcomed into the world of the tech transformation. 

The evolution of technology created a completely new labour market, and skills the previous generations owned are now completely replaced by something different. It is obvious that the claim “the world is changing” involves professions and working skills. But seeing how once welcome skills are completely irrelevant today, makes many of us think about the future. 

Today, we are facing the same change, without even being aware of it. The skills we possess are slowly, but steadily being replaced by robots, questioning the future lives of workers and middle class, as well as the lives of humans in general. Could technology evolve in a way to replace a man for good? 

Is 4th Industrial Revolution Really Happening? 

During the recent 46th World Economic Forum in Swiss resort Davos, over 2,500 participants, from more than 100 countries, representing business, government, academia, civil society, media and arts, have discussed the latest 4th Industrial Revolution. 

The agendas of Mastering the Fourth Industrial Revolution were the acute challenges of Geo-economics, global security, public health, education, gender parity and climate change. But most importantly, the meeting was focused on technologies and robots. 

“The Fourth Industrial Revolution refers to the fusion of technologies across the physical, digital and biological worlds which is creating entirely new capabilities and dramatic impacts on political, social and economic systems. The speed, scale and systemic nature of this transformation has the potential to disrupt all sectors and call into question the essence of human nature and identity. The purpose of our Meeting this year is to build a shared understanding of this change, which is essential if we are to shape our collective future in a way that reflects ultimately that the human being should be at the centre,”- Klaus Schwab, Founder and Executive Chairman of the World Economic Forum. 

Sadly, reports show that more than five million people are likely to lose their jobs by 2020 as part of the 4th Industrial Revolution. The jobs are to be replaced by robots because of the drastic change in the workplace that will be caused by artificial intelligence. The accurate number is unable to be confirmed yet, but some say that the five million number is just the net figure. The total number of lost jobs might come to seven million. 

 "Developments in genetics, artificial intelligence, robotics, nanotechnology, 3D printing and biotechnology, to name just a few, are all building on and amplifying one another. This will lay the foundation for a revolution more comprehensive and all-encompassing than anything we have ever seen." 

Speaking of the 4th Industrial Revolution, one must understand that there are certain principles that support companies in identifying and implementing the changes. 

1) Interoperability 

The ability of cyber-physical system, humans and Smart Factories to connect and communicate with each other via the Internet of Things and the Internet of Services. 

2) Visualization 

Virtual copy of the Smart Factory created by linking data with virtual models. Smart Factory presents a description of what industrial production will look like in the future - more intelligent, flexible and dynamic, not to mention interconnected. All this, together with virtual models/products/items, will be a part of the 4th Industrial Revolution. 

3) Decentralization 

The ability of cyber-physical systems within Smart Factories to operate and make decisions on their own. Cyber-physical system (CPS) is a system made of physical entities controlled and monitored by computer-based algorithms. Such entities will be able to operate within the (Smart) factory that can produce products with minimal equipment and human resources. 

4) Real-time capability 

The capability to collect and analyse data and provide the derived insights immediately. This flexible automation of the data will, for sure, change the current rules as it will merge with IT, hence provide less need for human involvement. 

5) Service Orientation 

Offering services via Internet (actually, this is already happening). We can simply use online shopping as one of the examples, but also Internet banking, as well as online banking institutions (without physical offices) that have been expanding in recent years. 

5) Modularity 

Flexible adaptation of Smart Factories to changing requirements by replacing or expanding individual modules (parts). This industrial automation process will help increase productivity and quality of the end product – again, without human resources. 

It’s said that more than 5 million jobs in administration and clerical roles are going to be replaced by robots, hence making this profession among the first ones to be fully gone. 

Another interesting fact is, about 70% of the children in primary schools today will be working in jobs that yet don’t exist. 

Robots Vs. Humans - Reality, not a Myth 

Robots are said to overrun humans in various tasks, including the creativity. Imagine only how far ahead technology can go with this ability to replace even the most complex part of the human brain! One of the latest news show how researchers have developed a system named Quixote, which has a capacity to learn humanly acceptable behaviour and act accordingly to artificial intelligence. 

Taking this into consideration, some fear that 50% of US and UK jobs will be put at risk in the coming years. 

These machines are different. Unlike in the past, they have the potential to substitute for human brains as well as hands. - Andy Haldane, Bank of England chief economist 

Haldane also compares the difference between the previous Industrial Revolution and this new one. 

Unlike during the Industrial Revolution, where manual laborers were forced to improve their skills and adapt to more sophisticated jobs, robots will simply replace humans this time around. The more intelligent machines would be able to take over mid-skilled jobs, leaving low-skilled or very high-skilled jobs for humans. 

Higher Level of Inequality and Exodus of the Middle Class?

Swiss bank UBS published a report in which it is stated that  there will be a polarisation of the labour force as low-skill jobs continue to be automated. It also points out that this automatisation is to be spread to middle class, as I’ve mentioned earlier. This likely means that humanity will face the middle class exodus, with a scenario where only two types of people exist: rich and poor. The high level of inequality that we are likely to face, is going to satisfy only small number of elite groups, but create a spread of dissatisfaction worldwide.  

These developments, which we believe are a part of a technology-driven 4th Industrial Revolution, have significant implications for investors, the global economy and the relative competitiveness of developed and emerging nations. 

Furthermore, the more intelligent and empathetic machines I’ve mentioned above, are indeed being produced at this moment. I’ve come across this company (Boston Dynamics) which has recently released a video showing the humanoid robot with a hockey stick, knocking a box out of its hands, and knocking it over with a pole. Atlas, the humanoid robot, was, to my astonishment, able to respond to these obstacles and finish the assigned task as planned. 

Accelerated Tech Development = Decreasing Workers’ Salaries 

Have you noticed how difficult has been to keep up with the tech changes lately? As seen on daily basis, tech is improving in an accelerated speed. It is almost impossible to keep up or adjust because the requirements and prices are changing too quickly, and something that has been brand new yesterday, becomes old too soon. Look at the smartphones, for example. If you bought yours two years ago, it would make sense to say “I own a new smartphone”. But you don’t. The new one has just been launched in the stores! 

Due to this rapid development of technology, companies are forced to spend a larger share of profits to update, repair, or replace their current technology in order to keep up with the market. This causes workers’ salary decrease. You can read more about the connection between robotization and world poverty here

Taking into a consideration all the problems robotization and tech development is bringing, it is interesting to see how people react. Younger generations are very much aware of this, hence asking questions about their future. You can easily come upon tweets like this if you search Twitter with the hashtag #Robots: 

Now, the question is, can young generations do something about this, or will they be, just like everybody else, forced into creating skills needed for the 4th Industrial Revolution? Are we seeing a brighter future with the coding and STEM generations, or are their future jobs going to bring more, intelligent machines to the world? 

I’d be happy to hear your thoughts on this.