The Bank of England’s chief economist has warned that up to 15m jobs in Britain are at risk of being taken by robots.
Andy Haldane said automation effectively posed a risk to nearly half of those employed within the UK as there are currently 33.7m jobs in the UK. Haldane thinks a “third machine age” could see the labour market “hollowed out” as well as a widening chasm between rich and poor.
In the US, Haldane estimated up to 80m jobs were also at risk of automation.
The new generation of increasingly sophisticated models could replace jobs considered “at risk” over the next 20 years, such as accountants and sales people.
Occupations most at risk included “administrative, clerical and production tasks” he said, adding that “those at most risk from automation tend, on average, to have the lowest wage”.
Speaking at Trades Union Congress in London, Haldane said that ongoing rapid technological improvements made it “risky” to raise the Bank’s interest rates from their historical lows of 0.5 per cent.
He also warned that it was a “fallacy” to assume that the totally number of jobs in the economy was fixed, with historical evidence indicating that automation could also create new job opportunities.
“There is essentially no evidence to suggest technology has damaged jobs and plenty to suggest it has boosted wages,” he said.
Haldane warned this time could be different because middle income jobs could be hollowed out by the rise of machines, leaving only low-paid and high-paid jobs. The growing use of intelligent robots “could act like a regressive income tax on the unskilled” which could then result in inequality rising.
“Technology appears to be resulting in faster, wider and deeper degrees of hollowing out than in the past,” he said, with robots now also moving into spaces that previously required thinking and creativity – not just manual tasks.
Humans may stay ahead in jobs that need “high-level reasoning” such as the use of imagination, and those involving empathy such as childcare or care of the elderly.
Haldane did say however, that as machines become ever more sophisticated, there is a greater likelihood that “the space remaining for uniquely human skills could shrink further”.
Earlier this year, the billionaire CEO of luxury goods company Richemont, with brands including Cartier and Chloe, said he was worried about the prospect of replacing workers with robots and the social unrest it would cause. Johann Rupert expressed concern about the development in technology, suggesting a poor uprising would then mean the middle classes wouldn’t want to buy luxury brands for fear of exposing their wealth.
“How is society going to cope with structural unemployment and the envy, hatred and the social warfare?” he asked.
Sign up to our newsletter to get the latest from Business Advice.