Short research on Amazon’s automation technology’s effect on worker redundancy
Kirjoittanut: Xiaoqing Yang-Pyydysmäki - tiimistä FLIP Solutions.
In the book AI Superpowers (Lee, 2018), Kai-Fu Lee has mentioned that AI and automation will possibly replace 40-50% of jobs within the next 15 years. It will mainly cover the following work and task scenarios:
- Repetitive and simple work, for instance, packing orders, moving packages, scanning codes
- Interactions with fixed desk books and dialogue content, e.g. customer service, receptionists
- Simple data classification, such as file filing, proofreading
- Narrow work field within the company, like doctors
- Work that does not require much face-to-face communication with people like drivers
It can be seen that automation will probably replace more low-skilled jobs. Statistics show that compared to 10% of workers with high-level education, above 40% of workers with low-level education will lose jobs to automation by 2030 (Vega, 2022).
In 2017, Amazon introduced 55,000 robots to the delivery system after purchasing Kiva Systems, the warehouse robotics company, in 2012. About 24,000 jobs were estimated to become redundant because of Amazon’s investment in automation and robots (Winick, 2017). In 2020, Amazon already had 200,000 robots operating within its warehouses in the United States (Edwards, 2020). It is difficult to find concrete data about how many low-level workers have been laid off because of massive robot usage in Amazon’s supply chain in 2021.
However, from Amazon’s employment statistics in the US during the past few years, it’s easy to see that the employment rate has been increased rapidly during the year 2015 to 2021. In 2021, Amazon employees increased by over 18% from the previous year. Marking the first time, Amazon has surpassed 1 million direct employees in the United States. See the table below (Bishop, 2022). While Amazon is replacing human labor with robots, they create more employment opportunities elsewhere.
|New Jersey||5,500||New Jersey||9,500||New Jersey||37,000|
Table 1. Amazon employment in the US
Robots and automation are mainly used to improve customer experience, operational efficiency, and logistics performance. Moreover, it also provides better working conditions and more secure working spaces from an employee’s perspective. There are stories of Amazon warehouse workers walking 10 to 20 miles a day on hard concrete floors. Much of that walking has been eliminated in newer warehouses outfitted with robots. The workers only need to supervise the robot to complete these tasks, and employees’ working experiences have been improved since then (Del Rey, 2019).
Amazon has started the free college program this January for their employees in the US. They plan to spend 1.2 billion dollars on the three new reskilling and educational programs that provide different career paths for employees with different educational backgrounds. They are AWS Grow Our Own Talent, Surge2IT, and the User Experience Design and Research Apprenticeship. They also offer upskilling programs targeted at employees who have not benefited from the above education programs (O’Donnell, 2021). In this sense, for example, the workers from fulfillment centers could be reskilled as IT technicians, data center technicians, user experience designers, or software engineers. To a great extent, worker redundancy can be solved by re-education programs. More employees will be needed in this area to meet the rapid development of e-commerce.
Bishop, T. 2022. Amazon tops 1M US employees. GeekWire. Read 20.20.2022
Del Rey, J. 2019. How robots are transforming Amazon warehouse jobs — for better and worse. Vox. Read 21.20.2022
Edwards, D. 2020. Amazon now has 200,000 robots working in its warehouses. Robotics & Automation News. Read 20.02.2022.
Lee, K. 2018. AI Superpower. Boston, Massachusetts: Houghton Mifflin
O’Donnell, B. 2021. ‘The new minimum wage’: Amazon and Intel offer employees access to training, reskilling. USA Today. Read, 21.20.2022
Vega, M. 2022. 19 Statistics About Jobs Lost to Automation and The Future of Employment in 2022. TechJury. Read 20.02.2022.
Winick, E. 2017. Amazon’s Investment in Robots is Eliminating Human Jobs. Silicon Valley, MIT Technology Review. Read 20.02.2022.