|The full PwC report (Will robots steal our jobs): pwc.co.uk|
Say hello to your co-worker, HAL. Automation is hitting office jobs in Chicago
September 8, 2017
West Monroe Partners deployed two bots into its finance and human resources departments this summer, meant to free its workers from some menial tasks. Employees at the Chicago-based consulting firm discuss how the bots, called Rosie the Robot and Hal 9000, have helped save time.
There's a new robot in town at West Monroe Partners' human resources department, and it's expected to shave off hours of work.
The bot, programed into an unassuming Lenovo Thinkpad, helps employees at the Chicago-based business and information technology consulting firm bring on new workers, entering data into a laundry list of systems. It's a job that takes an HR representative about 25 minutes. Rosie — named after the housemaid robot on "The Jetsons" — can do it in five.
Rosie represents one way companies are using technology to replace tasks performed by white-collar workers, a trend previously more closely associated with blue-collar manufacturing. It's part of a process experts have long warned is coming. Now, robots are here, one expert said, and if they aren't in your industry yet, they will be.
By the early 2030s, about 38 percent of U.S. jobs could be automated, according to a study consulting firm PwC, also known as PricewaterhouseCoopers, released in March.
Researchers hesitate to quantify the number of jobs advanced technology has already consumed. It can occur through attrition or remain undisclosed by private companies. Some employers, including management at West Monroe, say automation will free employees from menial tasks and create jobs needed to maintain the new technology, but it's undeniable jobs will be lost. In fact, some are already gone.
Recent layoffs at Allstate and Capital One, for example, were attributed directly to advancements in technology that made some positions obsolete.
Allstate quietly laid off more than 500 employees this year. Most were casualties of the Northbrook-based insurer's QuickFoto Claim feature, which lets customers send in photos of their damaged vehicles rather than waiting for in-person visits from claims adjusters, the company said.
It's becoming a dominant method for inspection, the company's president has said. Along with drones that assess roof damage, a new immediate payment method and other tech, it has removed inefficiencies from the system, according to the company.
At Capital One's Rolling Meadows office, about 400 jobs that support the credit card call center are set to be eliminated by the end of the year. Investments in digital tools have improved customer service, and people now can resolve issues on their own, spokesman Sie Soheili said in August.
Soheili did not respond to requests for comment on what types of digital tools have been deployed.
Call centers are at the forefront of automation, with tools such as messaging bots that use algorithms to help consumers sort out issues, said Mohan Sawhney, a professor at Northwestern University's Kellogg School of Management. Using artificial intelligence to understand text, the bot gets smarter with every interaction. Plus they're usually cheaper, quicker and more efficient than humans.
"Algorithms don't make mistakes," Sawhney said. "They don't have accents."
These technologies finally have advanced enough and been proven to the point that companies have started betting on them, Sawhney said.
"We've been talking about AI for 30 years, and now it's actually here," Sawhney said. "(It's) starting to have implications for jobs."
And this is just the tip of the iceberg, Sawhney said.
Traditionally, automation has affected manufacturing — those repetitive, predictable jobs on the assembly line that robots can do just as well, if not better. "But this time it's different," Sawhney said. "This time it's cognitive work. That's white-collar jobs that are going to be affected — and affected in a very, very fundamental way."
After predictable physical tasks, data processing has the highest potential for automation, according to a January report from McKinsey Global Institute. The study focused on activities rather than entire occupations.
About seven of every 10 minutes U.S. employees spend processing data could be automated using current technology, the report found. Data collection is not far behind.
These tasks touch jobs in almost every industry, the report found, from human resources workers recording personnel history — like at West Monroe — and medical staff compiling patient records to accountants processing payments and mortgage brokers filling in forms.
"These are not just entry-level or low-wage jobs; people whose annual incomes exceed $200,000 spend some 31 percent of their time doing these things as well," the report stated.
The CEO of Deutsche Bank, for example, said this month that robots will soon take over much of the work at the German bank, the Financial Times reported. Though some roles likely will be made obsolete, in other cases automation could just take over the routine aspects.
In another example, Fukoko Life Insurance Mutual Co. recently started automating document processing using IBM Watson Explorer, which uses language processing and machine learning.
The McKinsey report assumes that the adaptation of automation begins when the economic benefits exceed the costs. In some cases, a robot is cheaper than human labor. In others, it's not. The study did not do an in-depth cost or savings analysis. It can vary widely between industries, regions and activity types.
This is the fourth wave of automation, said Mehdi Miremadi, a Chicago-based partner at McKinsey & Co. and a co-author of the automation study.
The first wave brought the assembly line, and the second came after World War II, focused on industrial automation. Blue-collar workers were hit hardest then.
The third came with the internet, hitting white-collar workers in the 1990s and early 2000s. Now, we are "automating intelligence," Miremadi said.
To be sure, automation doesn't always displace human labor, he said. It transforms what humans do. The report found that only 5 percent of occupations could be fully automated using currently available technology.
"What we expect to see is more human-robot or human-AI collaboration than necessarily replacement," Miremadi said.
West Monroe is putting that theory to work.
With Rosie the Robot taking over some of the grunt work involved in bringing new employees into the firm, HR workers are free to do activities that require people behind them, HR manager Katie Binder said. That means integrating new employees into the company.
The roughly 900-person firm is growing, she said, with 20 to 30 percent year-over-year growth. The HR department is bringing on at least 10 new employees every two weeks. "(Rosie will) help us scale," Binder said. "We're going to continue to grow at that volume."
While less nefarious than its namesake in "2001: A Space Odyssey," a bot called Hal 9000 has been generating invoices in the company's finance department since July, freeing employees to do tasks that require "the higher functioning part of their brain," financial systems specialist Kevin Vandermyde said.
The bots can help companies do more with less, but they're not there to take jobs, West Monroe senior director Mike Hughes said. They're there to help make the employees do the jobs they have better.
As automation spreads, experts expect a growing need for employees that know how to maintain the new technology.
Job growth likely will come from nonroutine positions, according to a report by professors from Duke University and the University of British Columbia. It's the routine jobs — those involving sets of tasks that can be done by following instructions — that have been disappearing.
In the mid-1980s, 1 in 3 Americans older than 16 worked in a routine occupation, be that manual labor or behind a desk. When the study was released in 2015, that number was down to 1 in 4.
The report noted that those increasingly automated routine roles tend to represent middle-class jobs. And when they've been eliminated during recessions, such jobs have not made comebacks during times of recovery. That has contributed to the shrinking of the middle class, the report states.
McKinsey's Miremadi argues that automation has a significant role to play in productivity growth. And the U.S. needs a boost in that area.
As baby boomers retire, employment growth in the U.S. is expected to flatten, Miremadi said. Automation could help compensate by increasing productivity.
"It's not even a question of good or bad," he said. "It's needed if we are to maintain the same standard of living."
Of course, automating tasks will take time. Most industries are still in the piloting stage, Miremadi said. There will be nuances and regulatory kinks that will hold things up, like the self-driving car debates at hand in many jurisdictions across the country, including Chicago.
The cost of developing and deploying the technology will affect the pace of automation, the McKinsey report found, as will economic benefits. And just because a job can be automated, doesn't mean it will be.
The report estimates that between 2055 and 2075, about half of what people currently do will be automated.
And when it comes to white-collar jobs versus blue-collar, "technology is colorblind," said Chris Brahm, head of Bain & Co.'s global Advanced Analytics Practice.
"The color of the collar doesn't matter," he said. "If it's something that's relatively routine ... (it) gets automated."