A4 Structural unemployment due to automation

Topic

Structural unemployment due to automation is an anomaly occurring within the Production stream when the rate at which robots replace low-skilled labor exceeds the rate of available workforce retraining. As long as the robot-driven replacement rate for low-skilled labor remains below the retraining rate, displaced low-skilled workers have the time and capacity to retrain before being pushed out of the Production stream entirely.

Structural unemployment due to automation spikes when the rate of robot-driven replacement for low-skilled labor outpaces the capacity of available retraining programs to absorb those workers; it is not manufacturing robotization itself that causes this anomaly, but rather the fact that it displaces low-skilled labor at a speed that retraining efforts cannot match.

This is the same manufacturing robotization identified by the cross-cutting "Automation and AI" factor as having a specific impact within Production: robotization specifically displaces low-skilled labor, and it is this displacement—modulated by the extent to which algorithmic decision-making gains ground over human decision-making in the activity—that drives the rate of robot-driven replacement for low-skilled labor.

Monitoring the rate of robot-driven replacement for low-skilled labor against the rate of available retraining is, therefore, a direct way to anticipate structural unemployment due to automation within Production—before displaced low-skilled workers miss the opportunity for the retraining that would allow them to re-enter the workforce.

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