Are robots going to invade workplaces in Bangladesh?

What kind of scenario can be expected for Bangladesh if one takes a long-term perspective like the middle of this century? How likely is it that the scenario presented at the beginning of this article (in Part 1) - robots replacing a lot of human jobs  - would become a reality? In addressing this question, it might be useful to refer to the so-called "flying geese model" of development where one lead goose is followed by a few more flying in formation, and comparative advantage in the production and export of labour-intensive industrial goods shifts from one group of countries to another. In the original version of the model, Japan was the lead goose which was followed by countries like South Korea, Taiwan, and Singapore in the second tier and with Malaysia, Indonesia and Thailand completing the formation. That model could be extended to include China in the second tier and countries like Viet Nam and Bangladesh following the third tier countries.

The flying geese model mentioned above seems to have been reflected in the development pattern that unfolded in Asia and can be expected to characterise the sequence in which countries at different levels of development progress in their journey towards higher level of development. A moot question in the debate on the impact of automation on employment in a country like Bangladesh is whether the flying geese formation will be broken by the latest technological development. Can countries like China and Malaysia prevent their loss of comparative advantage in certain product lines by resorting to automation? If that happens, are countries like Bangladesh and Viet Nam going to follow suit and adopt automation on a large scale in order to match the competitiveness of the geese flying ahead of them?

The Mckinsey report mentioned earlier does mention the possibility that emerging economies with younger population may have to worry about generating new jobs in an age of automation, and points out the possibility that automation could upend some prevailing models of development. This is because low-cost labour may lose some of its edge as an essential development tool for such economies.

While predicting the future is a tricky business, it may be worth noting a few points. First, even for developed countries, reports like the ones mentioned above express considerable degree of uncertainty. For example, the time frame in the McKinsey report is 2055; and it concedes that the kind of automation it is looking at could happen a decade earlier or a decade later than predicted by them. In fact, automation depends on a variety of factors - technical, economic and social; and it is difficult to predict how the relevant factors will unfold in a particular country. But the past experience and the present situation of a country can provide useful insights.

A number of questions would be important. How feasible would automation be in the various sectors of the economy - present as well as those that are likely to grow? If technically feasible, would it be economically viable - especially in the context of the relative prices of the important factors of production? How would the acquisition of new technology be financed? What proportion of enterprises would have access to necessary finance?

OPPORTUNITIES, CONCERNS AND CHALLENGES:

Considering factors and questions mentioned above, it is possible to identify opportunities that a country like Bangladesh could have as well as concerns, threats, and challenges it could face. They are outlined in Table 1.

Although it may be difficult to say anything firmly about a distant future, the considered view of the present writer is that the concern about large-scale job losses arising out of automation is probably overblown. A good deal will depend on how policies are geared and the process is managed. A few points may be relevant in that context.

• Public policy, especially fiscal and trade policies, and legal and regulatory measures can be used to steer the pace and direction of automation in such a way that its net benefits exceed costs associated with it. It would be particularly important to prevent premature automation and when appropriate, create an incentive structure to facilitate selective automation so that gains can be made in raising productivity.
• Automation will of course be associated with changes in the type of jobs that the economy will have, and hence the education and skill development system of the country will face the challenge of adjusting to the changes. While the overall level of education of the workforce has to be raised, attention will need to be given to ensure that the type of education and skills imparted by the education system can meet the requirements of a knowledge economy.
• There is a danger that the change in the nature of jobs and the education and skills that will be required for them will accentuate the degree of economic inequality. This is because automation will benefit workers with higher level skills with creativity and problem-solving ability. Access to higher education and skills needed in a knowledge economy is already skewed in favour of the upper income groups. When access to the labour market and returns associated with different types of jobs will depend more and more on education and skills, inequality in the distribution of incomes is naturally going to rise. In order to prevent that possibility, the system of education and skill training will have to be more inclusive and broad-based. 

The writer is a former Special Adviser, Employment Sector, International Labour Office, Geneva.

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