Trump blames Mexico, China, and even Germany for taking US jobs and for US trade imbalances.
His message resonated with voters.
People can believe whatever “fake news” they want, but Trump’s theory on manufacturing jobs falls flat under any degree of scrutiny.
ZME Science reports Chinese Factory Replaces 90% of Human Workers with Robots. Production rose by 250%. Defects dropped by 80%.
According to Monetary Watch, the Changying Precision Technology Company focuses on the production of mobile phones and uses automated production lines. The factory used to be run by 650 employees, but now just 60 people get the entire job done, while robots take care of the rest. Luo Weiqiang, the general manager, says the number of required employees will drop to 20 at one point. Despite this reduction in staff, not only is the factory producing more equipment (a 250% increase), but it’s also ensuring better quality.
Adidas Moves Towards Robot-Only Factories
I commented on this before but the above article linked to it, and it’s worth another look: Adidas to Move Activity to Robot-Only Factories.
The footwear giant has announced it will move much of its activities from Asia back to Germany. The company unveiled ts prototype “Speedfactory”, a state-of-the-art, 4,600 square-meter facility which will automate most of the work.
After achieving success in Germany and the rest of Europe, Adidas slowly moved their factories to Asia, motivated by cheap labor. They now employ half a million people on the continent, but robots are slowly becoming cheaper than cheap manual labor.
Adidas produced 301 million pairs of sports shoes last year, but the demand still surpassed the offer, with the company aiming to produce 10% more. Shirts might also be produced at the same factory. The move will, of course, hash many jobs in Asia, creating only a few in Europe.
Amazon’s Robotic Supermarket
Digital Trends reports Run by robots: Amazon’s high-tech supermarket may only need three employees.
Amazon already has one of its revolutionary “Go” grocery stores open as part of a trial. If you missed the launch at the end of last year, it’s a place where you can just walk in, take what you need, and leave. There are no lines and no cashiers. Just choose, grab and, well, go.
The store’s “Just Walk Out” sensor-based technology detects when you pick up something from the shelf and, when you leave the store, charges all of your items to your account.
There’s talk that it’s also planning a far larger version of the high-tech store, with robots doing much of the work.
The supermarket might cover floor space of up to 40,000 square feet and, alongside the robots, be staffed by between three and 10 employees at any one time, an individual claiming to have knowledge of the plan told the New York Post this week.
Such a location would comprise two floors, with the first floor offering around 4,000 “goods that shoppers typically like to touch such as fresh fruits and vegetables, eggs, meats and cheeses, and grab-it-and-go stuff like beer and wine,” the source said. The second floor would have an army of robots picking and packing from a larger range of items — up to 20,000 different products – fulfilling online orders made by the shoppers downstairs or from people online at home who then drop by later to collect their items.
While Amazon’s smaller Go store is already up and running in Seattle as part of a trial, the company refused to confirm to the Post that it had plans for a much larger version.
However, if the source proves reliable, Amazon’s plan to automate the store with robots will come as little surprise to many observers.
Trump and Navarro moan about NAFTA causing a loss of US manufacturing jobs. If anything, NAFTA stabilized or increased US manufacturing jobs for six or seven years thanks to increase in bilateral trade.
The demise in US manufacturing jobs started in June of 1979, long before anyone could blame either Mexico or China.
Trump brags about saving 400-700 jobs at Ford and Carrier. They will vanish under more automation.
If Adidas brings a factory to the US or Toyota expands US production, manufacturing jobs will rise by another 800 or so. Then what?
Manufacturing may indeed return to the US, just don’t expect many jobs to return with it.
Meanwhile, automation is spreading to other areas. The big hit to jobs comes when millions of long-haul trucking jobs vanish due to self-driving technology. Expect self-driving trucks to be dominant no latter than 2022-2024, and possibly much sooner.
- Trump Accuses Germany of “Currency Exploitation”: Merkel vs. Trump, Is Either Side Telling the Truth?
- Navarro Nonsense and the Folly of Trump’s Proposed Tariffs
- Hugo Salinas Price and Michael Pettis on the Trade Imbalance Dilemma; Gold’s Honest Discipline Revisited
My challenge to the Secular Stagnation Theory of Summers has gone unanswered.
Mike “Mish” Shedlock
Robotics revolution!…I’ve tried to convince my millennial children to go into robotic engineering with no success.
Kid across the street has his masters in robotic engineering and gave up trying to find a job…. H1b employees, yaknow.
Stuki Moi said:
Since you’re reading a nominally “investment” blog, and if you have any faith in him, give him some angel money to work towards automating some annoying task………
I don’t know this kid, but a big problem with the US educational system, is it’s obsession with credentialism. Having an X degree in something, really doesn’t mean much anymore, since nowadays, anyone can get a degree in anything, with the only qualification required is to not mind taking on student debt.
So, having a Ph.D. in some fashionable field, just means someone is a slave to fashion. He _may_ be smart, or he may not. With the probability of “not” being large enough that it may in fact be more profitable to wait for him to do some independent work of value, and then buy him for $5mill, than to hire him green for even 3% of that.
He’s already automating an annoying task… He owns a medical marijuana shop.
Are you serious, Greg?
Stuki Moi said:
Wonder how output and defect rates are affected, by the robots being stoned?
Jon Sellers said:
The educational system isn’t obsessed with credentialism, the corporate labor market is. The educational system is just responding to market desires.
For a change I’m agreeing with Sellers here. Some of that market desire is because of the increase in needless occupational licensing.
THE FED intervention into financing tuition, to almost anyone, has been the base of the REAL problem; not the market place! The last time we saw this, was in the Housing market between 2002 and 2007! Go back in history for 50 years (my real time life experience) and EVERY SINGLE TIME I’ve experienced the FED getting involved with any market, they totally screw it up….. every single time!!! I’ve learned how to make money off the distortion! Everything from NAFTA to giving illegal aliens a check for $10k tax refund every year. Then the FED goes more into DEBT to bail out the problem they created, which is why we are running a $20 TRILLION dollar debt and adding $1 TRILLION per year at this time!!!
Stuki Moi said:
All throughout academia, the first thing anyone asks for when evaluating what you say, are credentials. Krugman and his famous prize is just the tip of the iceberg. Every study ever done about everything, seems to sort people by how many years of education, what degree they attained, blah, blah. Ditto for even being allowed to practice so called “professions.” Etc., etc.
It’s certainly a nice, self serving and profitable position for academia to be in, to serve as gatekeepers to potential careers this way. But hardly the most efficient way of allocating resources.
Lots of it may not be due to academic concerns per se, but rather stem from the run amuck kowtowing to ambulance chasers which has resulted people no longer being able to hire the best candidate as per their own judgment, but instead have to “justify it” in front of a panel of progressive half literates and their sycophant army of even less literates. With reference to, you guessed it, credentials. So its certainly a bit of a “what came first….?” situation. With the main gainers being the usual suspects, the perpetually useless at everything ambulance chasers. But also those anointed to a position, where they get to bestow the credentials that feed the degenerate machine.
For sure, a person’s qualifications for employment should be hinged upon certification of how many years they managed to avoid employment by staying firmly ensconced within the education system. There are an awful lot of people out there with some high and mighty sounding degrees that do not seem qualified for much of anything useful beyond extolling the horrors of student debt.
And technology seems to be such a volatile enterprise with specialties evolving daily, that it is hard to imagine investing more than four years into anything, given it’s short shelf life.
I do not know the specifics but it seems we have seen some pretty significant layoffs from the same companies begging for H1B visa immigrants, claiming they can’t find qualified people. Is the missing qualification a non-English language?
Many I have spoken to about this have indicated that specific nationalities dominate some departments and for unit “cohesion” they prefer their own “type”. Of course if they were white, this would be considered overt illegal racism, but as it comes from a minority, corporations see it quite differently…..more of a cultural diversity promotion….even if actual diversity approaches zero….unless you are taking a “world view”.
I thought companies only hired H1B’s because there aren’t any qualified Americans.
Yeah, and I thought if you hire a nanny from Britain she could fly by merely opening up an umbrella. It’s funny sometimes how easy it is to confuse fact and fiction.
That is the line lobbyists tell greedy politicians to repeat while they give them lobbying money.
Then Disney FORCES fired IT employees to train their replacements to get severance pay when losing their jobs to H-1B’s because H-1B’s cost less and they are tied to one employer like slaves so they don’t complain and do unpaid overtime and take bad working conditions because they know if they get uppity the employer will make sure their H-1B-visa is cancelled and they are sent back to India.
what they overlook is that we don’t have to shop in their robotic stores.
and many of us will not.
if they are saying that every company will have the money for robotics and that the investment will pay off, I disagree. Humans are irreplaceable, no matter how much we are told otherwise.
You think they’re not aware that everyone won’t be forced to shop there?
Aha, admission. GUILT !
Instead of insinuating they have plans to deal with the infidels, the disloyal, TELL US, TELL US HOW YOU GOT ZE PLAN !
I VONT ZE ANSWER . TELL ! NOW !!
Who says we are going to be replaced? We will simply become redundant, not requiring replacement but a simple discarding. Robots don’t consume, we do. And if we do not contribute, what possible “efficient” purpose would we have in a world dominated by efficiency (or at least the theory of it as a goal)? We will have to accept at some point that machines really don’t need us anymore.
“Robotics revolution!…I’ve tried to convince my millennial children to go into robotic engineering with no success.”
With the world communications networks such as they are, anything that can be done just as well and cheaper elsewhere or via H1B visa imports is vulnerable to offshoring or replacement by imported foreign labor. Engineering work other than DOD related stuff, due to security considerations for that work, is open for easy offshoring. As expert system AI becomes more prevalent, even the number of non-exportable design jobs will drop.
Boots on the ground tech skills absolutely requiring a local, physical presence are the safest way to go, things that require a physical presence. However, even robotics maintenance will be continuously “dumbed down” for economic reasons via “Built In Test Equipment” (BITE) implementation where the machine is able to diagnose its own fault (“Replace line replaceable unit #5B”). Such systems are even now remotely monitored over “secure” Internet connections.
Been a controls engineer for 40 years. My favorite quotation from despair dot com is “Just because your needed doesn’t mean your important.”
I liked the jobs I have had, but I would not recommend a career in a technical field unless someone really likes the work.
Neil Lori said:
A robot tax makes sense
so we can force up prices?
And people can afford to buy less, and get less for their money?
When does the idiocy stop?
Maximus Minimus said:
Perhaps examine this question from a different angle: did the US outsource so much manufacturing including in key strategic areas that it can no longer survive in a low level conflict which would then necessarily escalate into a full blown conflict?
That is an angle too many overlook. If a cold war started tomorrow with China (no full on nuke war but lots of proxy wars along with trade bans, shipping routes blocked etc) then how does any country not run into major problems if they have no strategic supplies of raw materials, minimal manufacturing capacity and no pool of skilled workers to design, build and operate the equipment? As bad as the US is it is probably worse where I am(Australia) where we will go this year to 100% importing all our cars because its “cheaper” to buy overseas and our politicians don’t think an auto industry is important. At least you still have an auto industry.
You explain the importers suffering.What of the exporter?
Carl R. said:
China, etc, was able to take manufacturing jobs based on lower labor costs. As labor gets eliminated, the value of this advantage diminishes, and the cost of shipment, tariffs, etc becomes more significant. Even though there are not a lot of jobs in an automated factory, there are still significant reasons to want them in the US, since the few jobs should be good jobs, and since they can pay taxes.
One of the overlooked aspects of China is that its shipping industry is massively subsidized. Which of course is not sustainable.
But Germany and the U.S. have large pockets of energy subsidies which are just as unsustainable but certainly become attractive to businesses with large energy requirements.
John Smith said:
Soon they should also be able to automate all the unemployed people this is going to create. The tasks are fairly simple: sit on couch, turn on TV, go to fridge to get a beer and cold pizza, belch, scratch armpit, fall asleep, wake up, repeat.
Declare robot wars and all the factories can be dedicated to building and repairing robots continuously forever & ever. No winners or losers just forever war. I think we are well on our way now.
Robotics will be predominant for a short while and then be largely replaced by something that reduces production costs far more. Both will be disruptive to the good.
Man’s (sane) future is to appropriate and adapt as much of nature’s technology as needed and nature is very very cost effective and productive. Nature is evolutionary nanotech, Man’s will be directed nanotech and his creations will become very cheap. And plentiful.
You think in terms of utopia and I think in terms of dystopia . The nanotechnology will be little robots to either terminate the great unwashed or turn them into remote controlled playthings for whomever controls the technology. Unless you really believe that those in charge will share the nanotechnology with everybody altruistically and that nobody could ever turn it into something bad/evil then dystopia wins.
Agreed. All it takes is a few ‘bad actors’ to ruin any cooperative scheme.
So where will future jobs come from Mish?
At least if we bring plants back to the US, we can do maintenance on the robots, no?
You paint a picture of “the point of no return”.
Soooooo, here is the musical interlude of such 😉
Jon Sellers said:
Why wouldn’t we build robots to maintain other robots?
And I believe Mish’s solution to the problem is that prices will go so low that we can get by taking jobs that pay almost nothing. But I should let the Mishman explain his stance.
We would have to assume that those corporations that OWN said technology, would be willing to offer its services at that all-time low price. IF there was competition…maybe, but while we see a trend in automation, we also seem to be seeing a trend towards mergers and acquisitions that reduce competition and put more and more market share under relatively few shingles. Of course our government is supposed to protect us from monopolies, but that seems to not be the trend either, especially when we consider potentially WHO owns government.
So, until we see a sea change in human behavior and corporate/technology/government ownership trends…color me suspicious that anything like a workerless Utopia will ever exist. Even my WIFE makes me work for meals sometimes. There ARE expectations!
What might work is for everyone to become a part time worker. I could get used to working 3 days a week for the same pay.
There is this region called ‘France’ where such things exist.
Are they still eating cake? or was it croissants?
Or schwarzwälder kirschtorte?
In 1810, 81% of the US workforce worked on farms. By 1960 automation reduced that to only 8.1%. Today, fewer than 2% work on farms. If you told people in 1810 that only 2% of the adult population would work on farms in the future, they would wonder what everyone else would be doing. The US is still creating tremendous numbers of new jobs thanks to free markets and entrepreneurial spirit. And living standards continue to improve. Yet so many people continue to fight to try to bring back the “old jobs” that are never coming back. Hopefully, Trump will not start a trade war to bring back old, redundant, and essentially non-existent jobs. Because that will simply result in job losses everywhere.
Living standards are declining for 80% of the population. The US is creating an inadequate number of part time, minimum wage jobs, most of them taken by aliens. 95 million in the work force have no jobs….When things hit the wall with the exploding cost of medical care and retirement costs, what will happen? Nothing good…
Taxation and regulation is increasing for 80% of the population. There’s your destruction of living standards. You have to sacrifice so your bureaucrat overlords can live more luxuriously.
Living standards are improving for 99% of the population.
1) What could the poorest 25% of Americans have in 1950 that they can’t have now.
2) What can the poorest 25% of Americans have now that they couldn’t have in 1950.
Answer 1 is very short. Answer 2 is very long.
Excellent comment realist. Had someone asked in 1810 where the jobs would come from, there would have been no answer. The jobs came anyway. Does the same apply today? I sure do not know where the jobs will come from. If I did, I could make a billion. But since I don’t does that mean the jobs are not coming?
The problem as I have said many times: the Fed is hell-bent on creating inflation in a technological deflationary world. Robots technology has advanced much faster because of low interest rates and rising labor costs (think minimum wage hikes)
The ZIRP policies by Fed and other central banks are speeding up the automation and robotization.
Governments around the world and people around the world are getting into more and more debt and debt levels are increasing MUCH faster than GDP.
What happens when the repayment of that debt is based on the FAKE illusion that that debt will be re-paid with the previous jobs model which is being destroyed by automatization, robotization, offshoring and H-1B immigration of medium wage workers (still cheaper than americans that is why companies do H-1B’s) and illegal immigration of low wage workers meaning people can NOT pay back that debt.
And because all of the above mentioned things are destroying the tax base neither the US government can pay back it’s debts.
The current consumer demand is boosted by increased consumer debt and increased government debt (which funds lots of welfare that creates consumer demand and which funds lots of FAKE jobs in all levels of government that government and states can NOT afford that create consumer demand and which funds lots of FAKE jobs in companies selling to the government like arms manufactuers and healthcare providers.).
Current consumer demand is mostly FAKE and funded by out of control debt which means that the current values in the stock market and bond markets (both government and companies and sliced and diced consumer debt) are TOTALLY FAKE.
James Greenberg said:
The jobs will be in entertainment and personal care. Things humans desire from other humans.
It is not change we fear, it is RATE of change. When technology displaces your trade over periods of generations or even decades, there is a chance to adapt, but when even those college graduates that find their ten year old education obsolete, requiring them to move back in with their parents while hoping student loans will get them the certification required to become again employed above barista grade, there is a real problem. Even those with adequate qualifications for what most would consider professional occupations are under deflationary pressures competing with H1b visa immigrants AND automation, possibly of their own designs.
We can applaud progress and covet our toys, but it is NOT being a Luddite to simply suggest that this is destructive if allowed to continue without some reconciliation or cognition for a need of balance.
My experience with business has been that those who go bankrupt do so slowly at first….and then all of the sudden. God knows that what worked ten or twenty years ago does NOT necessarily work today.
I think this is what we now face. And we have seen wealth redistribution and debt used to minimize the pain of the destruction thus far. We have 20 trillion in government debt, much of it spent to simulate a healthy economy. We want to believe that debt is necessary for growth in an economy, but we must also recognize it is necessary for theft as well. Everything is not equal. Just because it worked from 1810 till now does not mean it will work ten years from now.
The economy has been falsified on many different levels, as you have often pointed out. Why is it unimaginable to believe that this could be wrong.
James Greenberg said:
That’s a fair opinion Mad. Especially the part where there’s a time mismatch between earning an expensive degree and its premature obsolescence. Would we could wave our magic wands and halt the progress of technology. But I don’t see how that can be done, or if it is even possible. Perhaps kids should get degrees in general critical thinking or adaptation, lol. It really is sobering.
I contend a significant contributing factor to exponential tech advancement is debt, massive debt that creates malinvestment. We see many speak to the destructive effects of malinvestments in specific industries where plentiful money has incentivized disproportionate amounts invested in industries that overproduce causing pricing collapses that kill their markets, their business and their employees jobs.
We’ve seen government contribute to this by pushing fish farms, welding trade schools and on and on where pushing money into specific schemes has bubbled and popped trades and industries.
Why is this not applicable to the entire industry of technology and automation. We have seen trillions flow into tech markets that we know are direct beneficiaries of monetary policy and direct debt. If we subsidized illegal drug production and then surprisingly discovered that we had a massive a growing drug problem, would it be fair to consider the subsidization program to blame?
The vast difference between the number of people working in agriculture now and the number of persons living on farms years ago is invalid. Farming only gradually changed from a primarily subsistence activity to the crops for cash activity it is now. Only 200 years ago, persons on the farm not only raised their own food, but built their own shelters, made their own clothes and often also performed some specialized labor for pay (e.g. slaughtering animals or milling grain) for their neighbors.
You would need to do an in-depth analysis of life back then to determine what portions of today’s economy related to clothing, trade, food processing and storage, construction and transportation (especially of agricultural products and supplies) should be apportioned to early “life on the farm”. Probably a good masters thesis project for an economists degree, not the simple comparison you make.
I would look at it differently and look at the jobs that were created between 1810 and 1960 (may be extend it till 1990) and then between 1990 to 2015 and ask myself what kind of jobs were created, what pace they were created and whether it paid well.
While I do not have the exact statistics on this, we can safely say that between 1810 and 1990, the jobs that were created basically created the middle class and thus benefited a lot of people whereas the jobs that were created between 1990 to 2015 eviscerated the middle class, replaced workers by outsourcing (reducing cost) and created two kinds of jobs: 1) fewer jobs paying very well, where you have to compete with low-cost countries (IT) 2) low-paying (McDonalds – which itself is getting replaced now). The former helped a few but many were replaced and with the latter you can hardly make ends meet. This further impacts well-being, security, creating family, buying house etc. The impact on demand was offset by debt, provided by the easy Fed at low cost.The net effect was more and more inequality and after a couple of decades you got Trump.
In short, the past job performance between 1810 to 1960 cannot be extrapolated just because we cannot envisage the future. It can even be said based on the performance between 1990 to 2015 that the more likely result is inequality, unless jobs being created are well-paying and in numbers, and the end result will be social upheaval of some magnitude.
In fact the present course of automation leaves a lot of unanswered question on jobs, which is what creates the buying power and thus demand.
Who is going to buy if ALL are unemployed or so few that it hardly impacts demand. Why produce if the demand is insignificant? If ALL are unemployed who will fund the Universal Basic Income that everyone is talking about. These are few things I am thinking about.
“While I do not have the exact statistics on this, we can safely say that between 1810 and 1990, the jobs that were created basically created the middle class” kpl
Good thing you generalize/fantasize without the facts, because you are dead wrong. Most jobs have not been middle class, ever. If the WaPo wrote it, it would be fake news. A burst of middle class jobs post-WWII, that’s about it. Jobs have mostly never been pretty. A return to the mythical past is always better than a return to the real past. Read some history or memoirs of the periods, if you don’t like stats.
Jon Sellers said:
Agreed. The middle class is solely the creation of labor unions which were eviscerated in the US with the election of Reagan.
No, the US middle class was solely the creation of massive transfer of wealth during and following WW2 to the US from the rest of the world, first as a flight to safety/investment and then as we became the supply (manufacturer) for the (non soviet) world (whose infrastructure was either destroyed or insignificant). This created a worker shortage which drove up wages (and unions took advantage of) but it was only a matter of time before a) competition developed overseas (mostly by our gov in germany and japan initially) b) immigrants, women, and unskilled labor flooded the non union job market c) automation replaced labor (particularly skilled craftsmen). Our nation’s financial fortunes were also eroded first by the guns and butter policies, a loss of control over the oil market in ’79, financial crises, and resource depletion/contention in general.
Jon Sellers said:
So your theory is folks were getting tons of pay raises due to a labor shortage, so they all decided to join labor unions? Ok then.
In manufacturing yes, which generally had the effect of transferring wealth from others (both consumers and owners/investors) to themselves along with hampering their employer’s productivity. In most other sectors (eg agriculture, retail) there were large pay gains in the late 50s and most of the 60s which quickly collapsed when labor supply caught up. I met a black man who lived a fashionable life (new convertible) with his earnings picking oranges in FL but when he returned from Vietnam found the salary was 1/4 of his prewar earnings.
White collar was the only sector that performed somewhat like union and that too was because it fed off the rest of society (corporate, finance grew faster than its labor until the 80s, gov’t/contracting continued to grow indefinitely).
3 golden words: “Opportunity cost – zero”. That’s what technology brings. It lowers the barrier of entry for anyone with a decent idea and motivation. At the same time, it makes anyone without original ideas redundant. Anyone trained to do factory-style work from the morning bell to the evening whistle – that person is indeed going obsolete. The education system brought us generation after generation of human drones who know nothing better than to spend their days enriching the corporate master instead of enriching themselves.
If you’re lazy, don’t blame it on technology.
I think you mean “startup cost”.
“Opportunity cost” is the cost of not dong the thing you would have done instead.
Without an overhaul of our financial system and a rethinking of our social culture a repeat of an 1810 scenario is highly unlikely.
And can’t say I agree with the comment “The US is still creating tremendous numbers of new jobs thanks to free markets and entrepreneurial spirit”. I wouldn’t say service and Government jobs qualify as “tremendous”.
With a supermarket staffed by 3 people how are they going to prevent shoplifters ? Especially those in groups ?
I do suspect problems in this area
Totally unmanned seems a bit extreme
But tests will likely determine what they can get away with
RW in Seattle said:
Have an Amazon employee stand by the exit to check (at least nominally) goods against receipts (a la COSTCO)? Doesn’t seem to be a huge impediment
Maybe robotic machine guns firing tranquilizer darts outside a barbed wire fence, for those who elude TSA-style checkout posts.
Explosives, lots of them, and micro-chip everything so it can be traced by GPS forever.
Kurticus Maximus (@somuch_ennui) said:
preventing theft is also a problem without drivers in commercial trucking. also to get rid of drivers you’d need to retro fit the entire infrastructure of repair and fueling to accommodate long hauls – who’s paying for that? not the mega fleets and not their customers. open bed trucks are also out, since they need to be secured and tarped by someone. robot trucks if they do come as soon as you seem to think will be for local delivers in smaller trucks, and only for very large and wealthy companies that can put down the money to retrofit their facilities and buy their own fleets.
It is far easier to hijack a truck with a driver than one without
There will be alarms bells going off on forced entry or any deviations from route. Software will shut the truck down and police will be notified.
Remember the times when car alarms were still being perfected…someone brushed against a car and WOOO WOOO… still be going till the battery ran down….. barrrrp barrrp.
Anyway, people get savy… remember one story of a guy building an emp generator to get up to some small mischief, knocked out all communications for miles around. I haven’t hijacked many lorries lately, but certainly, not having to deal with a driver will be a big step forwards for some.
They perfected car alarms? I had no idea!
They showed it in the video. Some form of smart scanning as you remove the product from the shelf, combined with some form of code recognition as you pass the turnstile to leave.
They can have robot police waiting for anyone that tries to steal.
Amazon will probably try to corner the Robot Police market , too ;). Have you ever seen those videos of groups of people ( 5 to as many as 10 ) going into pharmacies and stealing the higher price ticket items ? Once word gets out that the market is undermanned, it will be very interesting to see what happens.
Yeah, an I seen that on TV too man, Robochops. They got real mean dudes that turn into knives and speak like somun you know. Dont goto Mazon man.
Put the stores only in places where the locals don’t steal.
Or: The store needs to know who is there, so anyone not a known “who” will set off all sorts of alarms.
Or: You may not even be allowed inside the store if you’re an unknown. Ever been to a jewelry store in a sketchy area of town? Double doors with buzz-in.
Or: Don’t expect a whole lot of privacy while in the store’s vicinity.
Or: Boobie trapped items with Hollywood-movie style trackers. Legit customers know to return them.
What’s interesting about these quick and easy ideas is: Has problem solving become a lost art? Why do so many comments on this blog ask querulous questions and so few suggest simple solutions? (Sorry, Harold. I don’t think your question is querulous. But, alas, alliteration allegedly alters allusions.)
“Put the stores only in places where the locals don’t steal.”
You’d be labeled a racist.
No such place exists.
Self-checkout lanes already illustrate effectiveness of automation logistics. When 1 cashier watches 8 self-checkout stations, sure, some customers will put 2 items in the bag and only scan one, but every hour the store will be saving 7-man hours worth of salaries and benefits which will more than make up for the capital lost to theft, which is an issue, even when no automation is involved.
People will steal, as they always do, but the stores will still be able to profit.
It’s next to impossible to use those things without assistance. Problem is they use weight to determine that what you bagged is what you scanned. So if the wind blows the wrong way, it thinks you’re pulling a fast one. They need a better system.
They certainly need improvement. I like to pile my items on the plate closest to the terminal and apparently when it exceeds a max weight it requires assistance with each additional item but doesn’t tell the user that (or report the current weight or max). Eventually a smart employee explained so I knew to split up items.
All that said, even with all the current issues it certainly saves money. And I’m sure the tech is constantly being improved by various companies.
John Smith said:
“Please return the unpaid item. You have 20 seconds to comply”
RFID and automated doors?
Your credit card is cleared on the way into the store. It is charged on the way out of the store.
How does Amazon prevent those who don’t have chargeable accounts (perhaps 60% of the population) from walking in and taking stuff?
Anyway, what to do with all these useless mouths, many of them with college degrees?
Stuki Moi said:
Perhaps you’ll need a chargeable account to be allowed in. Lots of 24/7 gyms in rural areas operate that way.
So if I swipe your wallet with your Amazon card in it then unless I need to enter a PIN or similar to enter the store I will then be inside. What is to stop me loading up several trolleys full of the higher priced items and walking out? You might even have nominal credit on your card (not enough to pay for the goods) but how will an automatic system stop the thief exiting with the goods? If I’m a legitimate shopper and the system detects not enough credit when I try to leave the store will it be able to detain me? What happens if it detains me and then it turns out that I did have enough credit but a system glitch happened? Who is charged with false arrest in that situation…..the system, the programmer, the store manager, the board of directors?
First off, someone could just as easily steal a credit card or cash now and use it. No one checks to see I’m who I purport to be at checkout. Second, if there’s a lack of funds issue, they won’t arrest anyone. They just wont let the merchandise leave the store. No different than what happens today when a transaction is declined.
Stuki Moi said:
I’d also assume unstaffed stores will be pretty pretty video camera intense.Perhaps even with fairly sophisticated bio metric scanners, to discourage theft. I’m sure store operators will have all manners of “privacy policies” that “prevent” them from sharing any of this. Until some tax feeder or ambulance chaser on the make, calls up his law school buddy who became a judge, of course. But then, it’s OK….
Going back to this particular store, the article hints only fresh goods and typical impulse buys are on the first floor, with the second floor consisting of robots packing stuff. So, while getting out with as much potatoes and organic quinoa as you can carry may be at least feasible, getting to the jewelry upstairs will probably be quite a bit tougher.
Yes, Amazon account automatically radio embeded in all ID and balance handled at gov.com .
How sad it is that, despite all these great advances in science and technology – advances that could make us happier, healthier, live longer, etc. – there are still some people, mostly in and around governments, who want to dominate the world by getting US and everyone else into bloody, deadly wars.
Not everybody has the wherewithal to be a robotics engineer. Over half the population is only suited for menial jobs – the ones being uprooted by robotic technology. And the underclass in America is growing by leaps and bounds. Scripture told us thousands of years ago that ‘idle hands are the devil’s workshop’. Watch out what you wish for. The unintended consequences may shock you.
Jon Sellers said:
Exactly the issue. Mish has a blind spot for politics. We cannot just choose to leave a significant portion of our fellow Americans behind. They will use the political system not for their own gain (they’re not smart enough for that) but to make the rest of us feel the pain they are feeling. Trump is an early marker for this.
Uneducated Americans have already been left behind. Low wage manual labor jobs are done by Hispanics. What will happen to them? They either join the welfare rolls or go back home.
Guess the US is their home by then, maybe you should learn some Spanish?
This is just an uncomfortable transition period where the entitled peasantry is slow to adapt to their loss of wealth/income. Eventually they’ll retrain themselves (ala youtube etc more than schools) to any skill needed locally and start gardening/egg production in their spare time. Ask your average illegal immigrant what they know how to do and you’ll find a diverse skillset. Ask them about their living and vehicle situation and you’ll hear about sharing of resources. That’s the future of the poor in the US (as used to be the case and as is the case in the majority of countries).
Agree. That might create new class divides over time, even rifts in society.
Jon Sellers said:
Also agree. The necessary endpoint of neoliberalism.
A third of the prison beds in California are occupied by illegal migrants.
We know very well how they adapt.
Take jobs away from the underclass and you create a police state.
Couldn’t find that stat but it’s roughly 22% for federal prisons. And two thirds of them are there for immigration violations. http://www.politifact.com/texas/statements/2016/aug/25/lamar-smith/mostly-false-lamar-smith-claim-one-third-federal-i/
There are fewer than 400k electronics engineers in USA.
(with fewer needed every year)
Truth seeker said:
Yea but from what I understand some of these robots r already becoming confused about their sexual orientation.
Jon Sellers said:
I refuse to share a bathroom with a female robot! What is this world coming to?
“Trump blames Mexico, China, and even Germany for taking US jobs and for US trade imbalances.
Trump is talking about what happened between 1994 and now.
You are talking about “future plans” and a Chinese factory that was automated.
Mish, I have worked for multinational companies with footprints in China and Mexico. They dismantled plants in the US and moved them to these countries for the lower wages. The factories that were moved were staffed with at least twice as many people in China.
They also relocated their headquarters to Bermuda, then to Ireland to avoid US taxes.
Reality doesn’t agree with your hypothesis that no US jobs were lost to these free trade agreements, they were. Perhaps without the agreements automation would have happened sooner and the jobs may have been lost to automation, but the fact is the jobs were moved to “LCC’s” or low cost countries, not High Automation Countries, but low cost countries. That is what happened, past tense.
Back in the early 2000s the justification from these MNC’s was “we’re moving closer to our new customer base, the emerging middle class of India, China, etc. Yes, I’m sure they can afford your new $800 dishwasher working at $0.42 / hour.
Automation seems to be picking up steam now, with mostly unpredictable results. Automats are not a new concept, but neither was webTV (FireTV) or thin client terminals (cloud computing.)
Unemployed people don’t buy things without access to debt or welfare.
NAFTA definitely cost american jobs.
The tech-revolution of the 1990’s and early 2000’s should have led to huge growth in manufacturing jobs in US but instead US manufacturing was just treading water because although more manufacturing jobs were initially born because of the tech boom other manufacturing jobs were continually shipped to Mexico at a rapid clip.
After early 2000’s when George W. Bush incompetently lobbied for european countries to accept China into WTO (because republican donors wanted China in WTO so they could move production there and get more profits by selling the products made in China back to americans with the consumption to be financed by continual increase in debts made possible by the real estate bubble Bush goosed with his ownership society and cash-out refi’s and lowering of interest rates) the tech manufacturing jobs have disappeared from USA too once China got into WTO and are now largely located in China.
The american consumers enabled their own jobs to be destroyed by continuing to consume by getting more and more into debt thereby making it possible for large companies to have their cake (american consumers consuming a lot) and eat their cake (destroying american consumers jobs) and getting even more cake (more profits because manufacturing in China is cheaper and americans kept consuming).
The consumer demand should have crashed because of offshoring of jobs, because of illegal immigration, because of H-1B-abuse years ago so politicians would have been forced to deal with the CONSEQUENCES of their political choices and political decisions but unfortunately Fed has hidden all the pain from the political class and Fed has enabled FAKE consumer demand and FAKE wealth to be created in american economy leading to more and more mal-investment and bubbles galore.
Agree with you evad. What is more, as automation evolves, it is likely to be shoed in to the existing globalised corporate structures, because that is where and how the rest of the logistics and accounting framework is already settled.
Mish … I will say that in the last 2 weeks I have gotten sick of your anti trump tirades. Are you a leftist, progressive, feminist man-hating cunt in disguise ? Because your attitude reflects it. About to boycott your site like I boycott any site that exhibits irrational progressive behavior.
Here’s the deal: I’ve been in the tech industry for over 30 yrs. I remember having a discussion about 25 years ago with my father who has long since past. A discussion about computers, technology and its advance. He watched Star Wars and Star Trek and thought it was about to happen. He thought that within 3-5 years we’d be talking to computers via voice recognition. I laughed at him. Told him he was wrong and that it was 20 yrs in the future. He didn’t understand technology and I did; not a sin. Not calling you evil either … just saying your wrong.
Trump is indeed right. NAFTA and the trade agreements over the last 25 years has been a disaster for the US. A gutting of the middle and lower classes. TRUTH IN THAT.
Going forward … is human labor going to be replaced by robots ? Yes. Will cutting off exporting jobs to China, Mexico and 3rd world countries stop that ? Nope. It will help and temporarily stave off the inevitable though. And it will position the US to be in a better position economically going forward.
So, MISH, two different questions. Two different answers. And a different answer overall as a result. The REAL answer is Trump is on the right path. May or may not make a difference 25 yrs from now when robots have replaced 70% of human labor. Nobody knows how that will turn out. But … MISH … YOUR ANSWER ON THE ABOVE QUESTIONS. WRONG. WRONG. AND WRONG. Bring into question your impartiality.
Is your blog, your articles … based upon reason, rationality, facts and reasonable conclusions. Or is it based upon Trump hate. Beginning to wonder. And you ought to look in the mirror and see who’s looking back. I will say that unless things change here … I will be looking elsewhere. If I want anti-Trump progressive propaganda … I can get that about anywhere the MSM exists. I come to your blog because I want Rationality. Fact. Reasonable conclusions based on real data. Concluding that Trump is wrong that Nafta exported US jobs is insane. Concluding that changing US policies won’t help the US is insane. Yes, technology is about to explode and change things. But that’s been the case for 50 yrs.
Mish is an original thinker with deep insight on many issues.
NEVER become a fanboy of any politician.
In my book Trump has to PROVE he is good by EFFECTIVELY implementing his election promises instead of lashing out and twitter tirading when he and DHS bungle things like initially also stopping Greencard holders from those 7 majority-muslim countries from coming to USA.
Trump has one huge question mark in that after meeting with Trump all the drug companies were happy as can be despite americans paying much more than other countries citizens for THE SAME DRUGS aka americans are HARMED by US government policy allowing much higher pricing on drugs for americans by american and multinational drug companies.
Furthermore supposedly free-market republican Rand Paul has just drafted a bill which will make healthcare companies including hospitals, doctors,health insurance companies and drug companies EXEMPT from ANTI-TRUST LAWS meaning Rand Paul is a total FRAUD as a supposed free-market republican and Rand Paul wants to legalize the restraint of trade and anti-competitive practices many hospitals, doctors offices, drug companies and health insurance companies currently practice and what is driving the medical costs in US to unbelievable high levels BECAUSE there is NO local competition in hospitals and doctors offices and medical imaging thanks to ineffective government policies limiting hospital placement and medical imging center placement and doctors office placement and allowing the sale of healthcare without predetermined pricing and same prices for everyone meaning that currently hospitals and doctors offices are breaking laws by not posting prices and socking customers with outrageously high prices after the fact and having some pay 10x-20x-30x for the same products and services depending on health insurance providers or lack of one.
Rand Paul will destroy all his credibility and his political career and the Paul name in politics and Rand will also DESTROY the legacy of Ron Paul if Rand Paul’s ANTI-COMPETITIVE and ANTI-FREE MARKET legislation giving hospitals, doctors offices , health insurers and drug companies EXEMPTION from anti-trust laws on the books becomes law.
Rand Paul wants it to be LEGAL for hospitals and doctors offices and drug companies and healthcare insurers to FINANCIALLY DESTRY americans.
Rand Paul’s “Obamacare Replacement Act” is a FRAUD upon americans that will make the financial destruction of americans in the hands of hospital companies, doctors offices, drug companies and health insurers WORSE by EXEMPTING them from ANTI-TRUST LAWS.
Rand Paul’s MIDDLE-FINGER to free markets and market competition:
“(a) Application of the Federal Antitrust Laws to Health Care
Professionals Negotiating With Health Plans.–
(1) In general.–Any health care professionals who are
engaged in negotiations with a health plan regarding the terms
of any contract under which the professionals provide health
care items or services for which benefits are provided under
such plan shall, in connection with such negotiations, be
EXEMPT from the FEDERAL ANTI-TRUST LAWS.”
Jon Sellers said:
Great rant! Truth is often ugly.
If all this automation is going to lead to great strides in productivity, maybe equity markets aren’t over priced after all?
Where will the consumer demand come from when robots and automatization take away the jobs?
As basic needs are met with robotic machinery work is based on entertainment and games. I include a large part of financialization under both with faster robotic algos competing for a few pennies.
Yes. Work produces wanted things. Resources are limited. Want is unlimited. If all other resources became free, time would remain.
…In North America, GM earned a record $12 billion, compared with $11 billion last year, leading to the largest profit-sharing payment to U.S. workers in GM’s history. The automaker’s profit sharing, which will be paid to 52,000 UAW-represented workers on Feb. 24…UAW workers receive about $1,000 in profit sharing for every $1 billion in profit…could cost the company as much as $624 million this year…“Today’s performance bonus announcement of a maximum of $12,000 each rewards our members’ dedication and commitment to building some of the most popular and high-quality vehicles in the world,” said UAW Vice President Cindy Estrada…GM workers received a maximum pretax profit payment of $11,000 last year and $9,000 in 2015. Workers received zero money in profit sharing from 2005-09 when the automaker was struggling.
Jon Sellers said:
We need to destroy the UAW. Look at how much our heroic hedge funds are losing to these greedy takers.
That’s good to hear.
Wish I was in London to check this out, but exhibit may travel to USA. According to CNET, a robot monk dates back to 1560, and exhibit was “filtered” down to 100 robots by only including humanoid robots. Article also says human-robot interactions in 2017 will double from 2016, which is an interesting metric to measure what is happening.
London’s Science Museum…robots, and there are over 100 of them all contained in one space…”Robots” tells a story spanning 500 years, thanks to a ragtag collection of droids that includes an automaton monk made in 1560 alongside a RoboThespian created in 2016…Before you freak out at the thought of the robot uprising these bots could easily plot together, take comfort in the knowledge that very few of them have any built-in artificial intelligence. Plus, the museum locks its doors very tight at night (we presume)…chose to keep the focus tightly on our closest relatives in the world of tech: the humanoid robots. “We could fill a space four times bigger with robots … so we had to find a way of filtering things down,”…
What robots do in their spare time:
Buh-bye Starbucks, Peets, etc.
Robo-Barista Serves Up Coffee in San Francisco
By Amy Klinkhammer | February 1, 2017 1:12 pm
Café X, a robotic, coffee-brewing kiosk has just opened its windows on 4th Street in downtown San Francisco.
The “barista bots,” which are actually robotic-arms designed by Mitsubishi, are the first of their kind in the United States, joined only by their sisters-in-arms serving hot brew in kiosks in Hong Kong. They may not be chatty, but they definitely know how to make your favorite latte just right.
Eight-ounce beverages can be ordered either in-person using the kiosk’s iPad menus or directly from a phone via the Café X mobile app. For now, they’re keeping things simple with just seven selections to choose from – all starting at $2.25.
Running late? Café X will remake your drink if it sits for more than eight minutes – and when you come to pick it up, the piping-hot redo will be free of charge.
Can’t Starbucks get their own robots?
Steve Masteller said:
I have some questions.
You state that manufacturing may indeed return to the U.S. but manufacturing jjobs won’t. I believe you. What do you think of this state of affairs? Is the U.S. better off with manufacturing on shore or off shore sans jobs? For whom is it better or worse, manufacturers, consumers? Does it even matter?
I am assuming it isn’t worth a major trade war, but what if a trade war is baked into the cake due to historical reasons? Does this change the answers?
Why does a trade war have to be baked in the cake?
The current path is going to cause one, or a currency crisis, or both
Can we get a graph of international factory automation companies’ sales for the same time period?
Factory automation is frequently developed by small numbers of expensive engineers. My company manufactures millions of relatively complicated units per year with technology accumulated incrementally (and installed in foreign factory space) by fewer than 100 engineers. Most of the work was done by fewer than20.
so what is the future Mish, americans wages will go lower but then again someone around the world will do the same thing for less prices. So its either hyper facism or hyper socialism(communism) which means all the means of the production will be nationalized. Personally i feel capitalism is making itself obsolete and what will be left is communism and massive population reduction. If somehow we avoid facism, then what is the future, expect your daughters or sons…to be sex slaves in some billionaires harem.(neo feudalism)
Jon Sellers said:
I volunteer to be Ivanka’s sex slave.
James Greenberg said:
Ah, but it’s the slave who waits while the master baits.
It has been reported here that some French candidates have suggested a “tax on robots” so at what point will the government here see this as a great way to increase revenue? Maybe not so many robots in the future?
Does a tax on robots do the same as a tariff?
Force producers to pass costs to consumers with a government cut.
They will put a tax:
William Coppedge said:
also this …..
Bank of America testing ‘completely automated’ branches http://www.charlotteobserver.com/news/business/banking/bank-watch-blog/article131267794.html
Bank of America opens branches without employees http://www.reuters.com/article/us-bank-of-america-idUSKBN15M2DY?il=0
more along the same vein –
Bank of America testing ‘completely automated’ branches http://www.charlotteobserver.com/news/business/banking/bank-watch-blog/article131267794.html
Bank of America opens branches without employees http://www.reuters.com/article/us-bank-of-america-idUSKBN15M2DY?il=0
Tom Jericho said:
While I can understand the benefits of going robotic (less cost, less defects etc.), but – who’s going to buy the resulting products? Hint: It won’t be the now jobless former workers.
Walmart fills with the jobless on check day.
OT : “The vehicle caught fire and burned quickly. Firefighters arrived to find a 150-yard debris field and battery cells exploding like Roman candles.”
Check out what a Tesla looks like after a crash :
A 150-yard debris field and investigators aren’t sure it was a high speed crash. Driver and passenger were both drunk and that may have been just as well given this level of devastation.
Bankers have printed outrageous service inflation. Few can afford to hire people anymore, so they hire robots instead. Automation might come anyway, but service inflation is accelerating the process.
Do not encourage you children to enter engineering. There are more than enough of us. Plumbers and electricians are inflation proof.