In the strive for zero labor factories we are nearly there. Is 90% good
enough?
China Daily reports Manufacturing Hub Starts Work on First Zero-Labor Factory.
A manufacturing hub in South China's Guangdong province
has begun constructing the city's first zero-labor factory, a signal that the
local authorities are bringing into effect its "robot assembling
line" strategy.
Dongguan-based private company Everwin Precision Technology Ltd is pushing
toward putting 1,000 robots in use in its first phase of the zero-labor
project, China National Radio reported. It said the company has already put
first 100 robots on the assembly line.
"The 'zero-labor factory' does not mean we will not employ any humans,
but what it means is that we will scale down the size of workers by up to 90
percent," said Chen Qixing, the company's board chairman.
After the work on smart factory started, Chen predicted that instead of 2,000
workers, the current strength of the workforce, the company will require only
200 to operate software system and backstage management.
"It is necessary to replace human workers with robots, given the severe
labor shortage and mounting labor costs," said Di Suoling, head of
Dongguan-based Taiwan Business Association.
Manufacturers in the PRD have been hit by a shortage of an estimated 600,000
to 800,000 workers, according to data released after the Spring Festival in
February.
Tens of thousands of migrant workers had earlier gone back home to inlands
for a family get-together and some of them decided to settle down in their
hometown where the living costs are much less than the coastal cities.
Shortage of Labor?
There is no shortage of labor. There is no shortage of skills either. Rather,
there is a shortage of people willing to work for what factory owners are willing
to pay.
And with cheap money everywhere you look, there is plenty of money at low
rates to buy robots.
Meanwhile, back in the US, McDonald's employees think they are worth $15 an
hour for taking orders and handing people a sack of crap.
Robots at Chili's, Applebees, Panera
High wages means fewer jobs. CNN accurately reports Robots will Replace Fast-Food Workers.
Panera Bread (PNRA) is the latest chain to introduce
automated service, announcing in April that it plans to bring self-service
ordering kiosks as well as a mobile ordering option to all its locations
within the next three years. The news follows moves from Chili's and
Applebee's to place tablets on their tables, allowing diners to order and pay
without interacting with human wait staff at all.
In a widely cited paper released last year, University of Oxford
researchers estimated that there is a 92% chance that fast-food preparation
and serving will be automated in the coming decades.
Delivery drivers could be replaced en masse by self-driving cars, which are
likely to hit the market within a decade or two, or even drones. In food
preparation, there are start-ups offering robots for bartending and gourmet
hamburger preparation. A food processing company in Spain now uses robots to
inspect heads of lettuce on a conveyor belt, throwing out those that don't meet
company standards, the Oxford researchers report.
Darren Tristano, a food industry expert with the research firm Technomic,
said digital technology will "slowly, over time, create efficiency and
labor savings" for restaurants. He guessed that work forces would only
drop as a result by 5% or 10% at a maximum in the decades to come, however,
given the expectations that customers have for the dining experience.
"If you look at the thousands of years that consumers have been served
alcohol and food by people, it's hard to imagine that things will change that
quickly," he said.
I think Darren Tristano is in fantasyland. The higher the
wage, the bigger the incentive to get rid of people.
Central banks have mush for brains in their attempts force wages and prices
up in this type of environment.
Question of the Day
How much do you tip a human server server, when the server did not even take
your order? The question will eventually be moot when robots bring food to
the table.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
