Wednesday, February 1, 2017

Will globalisation take away your job?

Anti-capitalist protesters in London; Nov 5, 2016

Millions around the globe may have taken to the streets in recent years to protest against the impact of globalization on their jobs and communities - but this backlash is only likely to grow as globalization itself becomes more disruptive.
The stark warning comes from Richard Baldwin, president of the Centre for Economic Policy Research think-tank, who has been studying global trade for the past 30 years.
Technological advances could now mean white-collar, office-based workers and professionals are at risk of losing their jobs, Prof Baldwin argues.
In the US, voter anger with globalization may have led to Donald Trump's election victory, but those who voted for him could be disappointed as his aim of bringing back jobs is unlikely to work, says Prof Baldwin, who also worked as an economist under President George HW Bush.
A surgeon operates a surgical robot at the First Affiliated Hospital of Sun Yat-sen University; 15 April 2015, in GuangzhouImage copyrightGETTY IMAGES
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Robots are now increasingly used in surgery; the first transatlantic operation - with the patient in France and surgeons in the US - was carried out in 2001
Protectionist trade barriers won't work in the 21st Century, he says. "Knowledge crossing borders in massive amounts [is the] big new disruptive thing."
It's going to help people in Africa and Asia compete more effectively with people in the West, as communication advances mean workers in the developing world will be able to control robots to do jobs in Europe and the US at lower cost, he says.
Virtual migration
Developing world labour costs can be a tenth of what they are in the West, says Prof Baldwin.
"They can't get here to take the jobs but technology will soon allow virtual migration, thanks to telerobotics and telepresence."
Some of the first migrants from Jamaica at Tilbury, London, on board the Empire Windrush; June 1948Image copyrightGETTY IMAGES
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Some of the first post-war Jamaican migrants to the UK - future migration could well be virtual
Ever-faster internet speeds becoming globally more widely available, coupled with the rapidly falling prices of robots will allow workers, for example in the Philippines or China, to remotely provide services to a country like the UK - where the sector accounts for about 80% of the economy.
"What it will do is unbundle our jobs and change the nature of our occupation. Some of the things you do absolutely require your judgement - but parts of your job could be off-shored, just as some stages in a factory can be off-shored.
"All you need is more computing power, more transmitting power and cheaper robots - and all that is happening."

Media captionCould 'virtual migration' hit middle class jobs?
Security guards in US shopping malls could be replaced by robots controlled by security personnel based in Peru, and hotel cleaners in Europe could be replaced by robots driven by staff based in the Philippines, he argues in his book The Great Convergence.
Robots rise
The use of robots has grown exponentially since the mid-20th Century.
Flywheel production at the Ford motor plant in Highland Park, Michigan; 1914Image copyrightGETTY IMAGES
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A Ford factory in 1914; the development of robots has radically altered such production lines...
a robotic assembly line at the BMW Mini car production plant in OxfordImage copyrightGETTY IMAGES
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...now spot the workers; this is a BMW production line in the UK in 2013
A typical industrial robot can cost about £4 an hour to operate, compared to average total European labour costs of about £40 an hour - or £9 an hour in China. And robots are getting cheaper to buy and are increasingly able to do more complex tasks.
number of industrial robots; 1985 to present
This means the increased use of robots is also threatening millions of jobs in developing countries, says the United Nations Conference on Trade and Development (Unctad), as well as in developed economies.
And it's not just in factories; the worldwide number of domestic household robots will rise to 31 million between 2016 and 2019, says the International Federation of Robotics (IFR), with sales of robots for cleaning floors, mowing lawns, and cleaning swimming pools forecast to grow to about $13bn (£10.3bn) in this period.
French Emperor Napoleon Bonaparte fleeing after being defeated at the Battle of Waterloo; June 1815Image copyrightGETTY IMAGES
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Napoleon's defeat in 1815 after almost 25 years of war triggered a growth in world trade
In the 19th Century, the first wave of the industrial revolution triggered an upsurge in global trade. Steam power, the end of the Napoleonic wars and the subsequent era of peace cut the costs of moving goods internationally.
Global wealth became increasingly concentrated among just a few nations; the G7 group - the US, Germany, Japan, France, the UK, Canada and Italy - saw their share of the world's wealth rise significantly.
But from the 1990s a second wave of globalisation kicked in, with the rise of information and communications technology. There's been a dramatic change of gear, and "a century's worth of rich nations' rise has been reversed in just two decades," says Prof Baldwin.
G7 as share of world income; 1820 to present day
Old-style globalisation "worked on a calendar that ticked year by year" whereas the current wave of globalisation is being driven by IT which is changing and disrupting economies and societies with increasing rapidity, he says.
Political backlash
All of this has created a backlash, especially in developed economies, as many voters say they are losing out or seeing little of the benefits that globalisation supposedly brings.
Anti-capitalist protesters in London; 5 Nov 2016Image copyrightGETTY IMAGES
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Globalisation has sparked protests around the world...
Prof Baldwin says protectionist policies, such as those of Donald Trump, are ultimately counterproductive. If firms become inefficient by being forced to move jobs back to the US, then ultimately they will lose their business to international competitors.
"People are so angry they are doing things that are not in their own interest.
"Cures are being sold which are not related to the problem."
President Donald Trump waves to supporters after being sworn in; 20 Jan Washington DCImage copyrightGETTY IMAGES
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Globalisation has been a factor in the election of Donald Trump in the US...
Leader of the United Kingdom Independence Party (UKIP), Nigel Farage reacts to the UK's Brexit vote; 24 June 2016Image copyrightGETTY IMAGES
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...and the UK's vote to leave the European Union
He points out that the backlash is not the same in every single country. It often depends on how governments deal with workers who may be displaced by technology.
"For instance, in Japan they take care of their workers, and there really isn't an anti-globalisation feeling there," he says - unlike in the UK and the US.
As a consequence, even businesses that are benefiting from greater automation are increasingly sensitive about the potentially negative social and political consequences.
South Korea's manned walking robot 'Method-2' project, from Korea Future Technology. Dec 27, 2016Image copyrightGETTY IMAGES
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Increasingly sophisticated robots mean many jobs that used to exist are not going to return, says Prof Baldwin
Similarly, in Europe the bosses of both Deutsche Telekom and Siemens have advocated paying a basic income to workers replaced by technology.
We may see a move to protectionism as countries try to preserve jobs within their economies, but this is unlikely to work in the long term, says Prof Baldwin.
Balancing act
The trick is to accept "21st Century reality", he says, and the fact that many jobs simply aren't going to come back.
Protesters in Bordeaux with a banner reading "together against unemployment and social precariousness"
Governments need to pay more attention to social policy, says Prof Baldwin. "In the post-war period of globalisation we liberalised trade but at the same time we expanded social welfare - instituted low-cost education and retraining for workers.
"In essence there was a set of complementary policies that reassured workers that they would have a good chance of taking advantage of globalisation."
The challenges all this is throwing up for governments are many, but Prof Baldwin says it should be possible to develop policies that embrace globalisation - and give workers displaced by it the support they need.

SOURCE BBC NEWS

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