The impact of technology adoption on the U.S. manufacturing sector

Digitalist

Hello. This is your daily Digitalist insight, brought to you by SAP. Building on yesterday’s topic about automation in the manufacturing sector, today we’ll focus on the opportunities and potential changes that technology adoption presents. There’s no consensus about the scale or timing of worker displacement, or the net impact on jobs of automation and digitization in the longer term. But the McKinsey Global Institute reports that, while 49% jobs will be subject to some degree of automation, only 5% will be fully replaced any time soon. In most places, automation will take over one specific, and often dull and repetitive, task—as opposed to entire jobs. According to James Manyika director of the McKinsey Global Institute, “Even while technologies replace some jobs, they are creating new work in industries that most of us can’t even imagine, and new ways to generate income”. In fact, most technology companies argue that digitization and machine learning will lay the foundation for countless new scenarios, opportunities, and business models that will enable companies to create more, higher qualified and better paid jobs. And there’s historical precedent to prove it. Nevertheless, there needs to be a call to action for companies, governments, and education institutions to manage the transition into a digital economy. For starters, there needs to be improved science, technology, engineering, and math skills education, and we need to foster adaptive and lifelong learning for students and people throughout their careers. Additionally, companies need to both play a more active role in the education of students currently in educational system, and as well as training their own employees to ensure they have the skills needed for both the company and employee to succeed. Governments should also get involved and consider creating incentives for private sector investment to treat human-capital like other capital. And overall, we need to rethink employment transition support and safety nets for workers that find themselves affected by loss of work. The time to discuss and set forth plans is now. The future of jobs and how much collaboration between man and machine there will be, is entirely up to us. That’s today’s briefing., Tune in tomorrow for more business insights and ideas on the latest technology and trends, on the Digitalist flash briefing brought to you by SAP.