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Workers vs robots: a new kind of onshoring


Walmart has given up a five-year effort to introduce stock-checking robots to its stores. Staff, who evidently do the job better, can breathe a sigh of relief. The contrast is with the Norwegian oil industry, where remotely operated oil rigs have spooked unions and last month triggered a strike. Distant control of machinery is increasingly prevalent in natural resources, reducing labour costs and improving safety in extreme environments.

Objectors are fighting a rearguard action. Ports show what lies ahead. Here, ship-to-shore remote-controlled gantry cranes have replaced wharfies from Felixstowe to Melbourne. 

In mining, automation began in the middle of the past century. Unmanned mining rail carriages are now commonplace. The commodities crash of 2012-2015 provided an impetus to increase productivity and shave costs — factors not lost on the oil industry. Rio Tinto last year completed the roll out of what it claims is the world’s first fully autonomous, long-distance heavy-haul rail network.

Oil rigs have been on the automation march for most of the past decade. Remote control rooms can manage everything from drilling to procurement. The safety advantage of having fewer bodies on rigs is obvious in a pandemic. Benefits to the bottom line are just as clear. Equinor, as Statoil is now known, says the move added more than NKr2bn ($212m) to earnings within a year of its Johan Sverdrup rig going digital. 

The biggest savings come from shrunken payrolls. In the developed world, robots are set to replace humans in a range of physically tough, repetitive jobs, from order picking in warehouses to lifting the old and infirm.

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Up to 800m jobs could be lost across industries to automation by 2030, McKinsey Global Institute estimated in 2017. The UK’s Office for National Statistics, reckons 1.5m English jobs are susceptible to partial or full automation. It has even built an online bot to tell workers how vulnerable they are. The victory of humans over robots at Walmart is likely to be a temporary one. Businesses that automate are still safer investments than ones that do not.

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