JOHANNESBURG – Largely, there is agreement that information and communications technologies (ICT) have a positive impact on productivity. In his book titled The Age of Turbulence, former chairperson of the US Federal Reserve, Alan Greenspan, explained how ICT propelled the economies of the countries referred to as the Asian Tigers (South Korea, Hong Kong, Singapore and Taiwan).
Although there is general consensus that ICT increases productivity, economists and policymakers have been struggling to determine the exact percentage of economic development which can be attributed to the role of ICT.
During the past five years, the ICT-driven robotics/artificial intelligence (AI) have substantially increased productivity in both the manufacturing and services sectors. The efficiency of advanced robots is boosted by ubiquitous computing, big data, 3D printing, driverless vehicles and the Internet of Things. I observed this when I visited the Huawei Manufacturing Campus in Shenzhen last year. This manufacturing campus will probably need a total of 45 000 employees to produce thousands of parts and finished products daily.
It is my contention that while the robots would have taken about 24 000 jobs, the overall input of Huawei in the broader economy far exceeds the loss of jobs. Moreover, whereas jobs would have been lost in this manufacturing plant, many more jobs would have been created in the value chain and in the broader economy. I have no doubt that Huawei wouldn’t have surpassed iPhone and become the second-largest smartphone supplier in terms of the global market share if it didn’t employ the services of robots, which are powered by AI and abundant broadband services.
There are no empirical studies that have reported if robotics are jobs creators or killers. It is my assertion that whereas robotics will reduce a number of jobs in a particular firm, their overall impact to economic development will lead to the creation of more jobs in the value chain and broader economy.