Martin Ford: Outsourcing Jobs…that Can’t be Outsourced

People who work in knowledge-based fields like information technology, accounting, graphic design or legal research are probably well aware that their jobs are susceptible to being outsourced to a low wage country. In fact, I suspect that economists underestimate the impact that this practice will have on the job market as improving technology makes offshoring cheaper and more accessible to smaller businesses. That may be especially true if weak consumer demand continues to push businesses to focus on cost-cutting rather than revenue growth.

But what about people who have jobs that involve physically interacting with their environment? Those jobs can’t be offshored, right? Well…

There’s an article in the San Jose Mercury News today on the emerging remote-controlled robot industry:

Remote-controlled robots are entering the workforce

The declining prices for telepresence robots will encourage experimentation among companies and entrepreneurs, who will find new uses for them, analysts say.

“These robots will have a network effect,” said Hyoun Park, an analyst at the Aberdeen Group, a technology research firm. “The more robots there are, the easier it will be to work remotely in ways we haven’t thought about before.”

As as these technologies become more prevalent, I think one of the new ideas that will emerge will be offshoring the control function. So you’ll have a worker in India or Bangladesh who can do a job that requires physical proximity in a developed country. Some jobs that “can’t be outsourced” … might just get outsourced.

I have a section on this in my book The Lights in the Tunnel: Automation, Accelerating Technology and the Economy of the Future (get the free PDF), which focuses on how technology and globalization are likely to result in increasing structural unemployment:

Those jobs that require significant hand-eye coordination in a varied environment are currently very difficult to fully automate. But what about offshoring? Can these jobs be offshored?

In fact they can, and we are likely to see this increasingly in the near future. As an example, consider a manufacturing assembly line. Suppose that the highly repetitive jobs have already been automated, but there remain jobs for skilled operators at certain key points in the production process. How could management get rid of these skilled workers?

They could simply build a remote controlled robot to perform the task, and then offshore the control function. As we have pointed out, it is the ability to recognize a complex visual image and then manipulate a robot arm based on that image that is a primary challenge preventing full robotic automation. Transmitting a real-time visual image overseas, where a low paid worker can then manipulate the machinery, is certainly already feasible. Remote controlled robots are currently used in military and police applications that would be dangerous for humans. We very likely will see such robots in factories and workplaces in the near future.

As I’ve written previously, I don’t think economists understand the extent to which technology is playing a role in the current unemployment crisis–and more importantly how things are likely to progress in the future. Technology and globalization are not going to stand still while we wait for the job market to recover. They will continue to progress and even accelerate. That will make it very difficult to drive the unemployment rate back down without some very effective policies in place.

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Martin Ford is the author of The Lights in the Tunnel: Automation, Accelerating Technology and the Economy of the Future (available from Amazon or as a FREE PDF download) and has a blog at econfuture.wordpress.com .

Read more: Financial Crisis, Globalization, Joblessness, Unemployment, Business, Technology, Economy, Technology News

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