From Self-Serve Kiosks to Automated Credit Decisions: It’s Not Necessarily Robots That Will Take Your Job but Computers Will

The nation’s 3.4 million cashier jobs are likely heading the way of the dinosaur within the next couple of decades and you can see the reason why as you run errands everyday. They aren’t being replaced by humanoid-looking cashiers, they are being replaced by the device on which you are reading this right now.

Computers and automation go hand in hand and while actual robots are absolutely taking manufacturing jobs (along with probably putting 10+ million out of work in the transportation/logistics/services business in the coming years), the devices which are going to make the biggest impact in the coming automation wave are much more mundane.

In the grand scheme of things, a highly-automated economy should be good for just about everyone. In the short-term, it’s going to affect the people who can ill-afford to lose their job the most. The colloquially termed “McJob” is going to be a relic of the past. These positions are often filled by younger people looking to provide support for themselves or for their families, or by older individuals who do not have the skills (or cannot find a job) to compete in a different field.

Comedian Chris Rock may have said it best when he made the quip: “Working for minimum wage is like your boss telling you that they would pay you less if they could, but by law, they can’t”.

Do you wonder why mobile ordering is being pushed so hard by many companies? It’s because it usually results in a win-win situation for the company and the consumer. You don’t have to wait in line and can even schedule a pickup time, while the company gets to use information about you for marketing purposes, they are guaranteed to get your business when you mobile/online order, and they can cut back on labor.

Amazon is the poster-child of how computers and automation are going to cut out the human element in the workforce. With its goal of not having a human hand touch a product from packaging to doorstep delivery, it’s only a matter of time before we start seeing the layoff waves coming from Amazon’s massive distribution network.

In the world of finance, computers have already replaced humans in everything that requires any type of speed (high frequency trading) and major investment firms are starting to move towards accounts managed not by humans but by computers. Humans have the tendency to work on a hunch or a feeling as opposed to data, a problem that computers do not have. Investment banks also do not have to pay out bonuses to a computer, or pay it a salary with benefits, taking just a few programmers to replace hundreds of money managers.

Even the home you live in was probably touched by an automated algorithm that determined whether or not you, or your landlord, was a credit-worthy risk for a loan backed by the property. In the past, some consumer banks would have hundreds of loan officers on hand to make decisions based on what the algorithm (your credit score) told them and other factors. Now, those loan officers just look at a computer screen that basically says “Accept” or “Reject” and pass that information along to the applicant. What you see online with mortgage companies now is that there is no human to pass the information along, just the computer screen. Soon, your neighborhood bank is going to be the same way – A couple of people in the building to handle special requests while the bulk of the business is being done either online or through the ATM.

Experts have said that about 50% of the workforce could be automated in the next 20-30 years, which was taken by some to mean we are going to see robots everywhere. This isn’t the case since robots are expensive to build and maintain (though less than a paying a living wage to a human). What we’ll see instead are simple screens popping up in places we haven’t seen them before. A lot of people are going to lose their jobs over this and unlike other innovation waves, the numbers may be too great this time to see a respectable bounce-back.