Firms with more robots also have more workers overall, Statistics Canada study says

Jordan Press
·3 min read

OTTAWA — Statistics Canada says domestic firms that invested in robots since the late 1990s have also expanded their human workforces.

The findings released Monday show that over two decades, firms that automated some tasks had workforces 15 per cent larger relative to other companies in the same industry.

"The results of this study suggest that the impact of robot adoption on employment has not been apocalyptic for labour overall," the agency says.

Overall increases were from bumps in high-skilled jobs, such as programmers, that require university degrees, and low-skilled workers with high-school diplomas or less.

Those in the middle, such as trades workers, were more likely to not be replaced once robots arrived.

Firms that invested in robots were also likely to cut the number of managers, the analysis says, giving workers more control over decisions and performance incentives.

The studies are based on administrative data from companies that added robots and automation to their activities between 1996 and 2017.

Automation does bring change and it can be painful, Statistics Canada acknowledges.

"Robots will also bring disruption to jobs, not only displacing some jobs, but also changing the requirements of other jobs. Not all workers will benefit from this change."

Federal officials have tracked the impact of automation on the workforce for years. In work done last year, federal experts found the likelihood of a "doomsday" scenario where automation eliminates half of Canadian jobs to be overstated.

That's not to say that parts of the economy wouldn't face challenges in the coming years. Last year, officials estimated that about one in 10 jobs could be automated over the next 15 to 20 years, and almost another one in three could change significantly.

In 2008, the stock of robots in Canadian industry was $1.2 billion, Statistics Canada said, just under half of them on automotive assembly lines.

Nine years and one global recession later the total stock increased to $1.5 billion, but less than $400 million worth was in the auto sector. Statistics Canada said investments rose in sectors like agriculture, mining and construction, as well as in health.

The study suggests companies that automate their work, or buy robots, do so to improve their product and service quality rather than to reduce labour costs.

Canadian companies have traditionally been slow to adopt new technologies, leaving some behind international counterparts or, at worse, shuttering for good. But decisions to automate often get accelerated during economic downturns like the one caused by COVID-19.

If companies don't invest in technology now, they risk falling further behind competitors, "which could have significant implications for Canadian employment and competitiveness as we recover from the pandemic," said Creig Lamb, a senior policy advisor at the Brookfield Institute for Innovation + Entrepreneurship.

"On the other hand," he said, "if Canadian firms accelerate technology adoption in the wake of the pandemic, we might see some shifts in the demand for workers, which would require concerted efforts to help the workers who have been displaced adapt to a changing job market."

Lamb said any efforts to get firms to adopt technology faster need to consider who will lose and gain work to help workers adapt to changing labour market needs, and avoid worsening inequalities.

This report by The Canadian Press was first published Nov. 2, 2020.

Jordan Press, The Canadian Press