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Rachel Reeves

MP and Chair of the Business, Energy and Industrial Strategy Select Committee

The UK is at risk of being left behind by the Fourth Industrial Revolution

The UK led the way in the First Industrial Revolution, embracing new technologies and the opportunities they created. But as we embark on the Fourth Industrial Revolution and the transition to automation, the reality is we are lagging behind our international competitors in adoption of robot technology.

We cannot pretend that the move to automation doesn’t bring challenges for businesses and for workers. Given the way in which communities were failed during previous industrial changes, such as the decline of the UK’s coal and steel industries, it isn’t surprising that that some may be worried about job disruption and livelihoods. But the real danger for workers, for the UK economy and for future jobs growth is not that we have too many robots in the workplace but that we have too few. In 2015 the UK had just 10 robots for every million hours worked, compared with 167 in Japan. By 2017, we represented just 0.6 per cent of industrial robotics shipments.

The UK has a long-term productivity problem. Research shows that industrial robotics is a significant driver of improved productivity. Online delivery firm Ocado, for example, credits retail automation with doubling the productivity of their warehouse operatives. If as a whole, the UK continues to fall behind in the adoption of new technologies, our lagging productivity will drop yet further and there will be the risk of future investment decisions being abandoned. Businesses, investment and jobs threaten to flow overseas – negatively impacting on economic growth, wages and living standards in the UK

The fact is that for all the opportunities offered by the UK’s ambitious tech firms, our fantastic research base, and our excellent universities, if the transition to automation is managed badly, then entire groups and regions could be left behind and British businesses could find themselves uncompetitive. To ramp up the leadership and co-ordination needed to enable the UK to capitalise on these new technologies, we recommend in our report that the Government should come forward with a UK Robot and AI Strategy by the end of 2020.

This new strategy must seek to get the right support in place, on issues such as skills, investment and training, to ensure that all parts of the UK share in the jobs and growth benefits offered by automation.

In our inquiry, we found that a lack of awareness and understanding of automation is harming productivity, especially for SMEs. The Government dropped the ball when they closed the Manufacturing Advice Service in 2015, making it more difficult for businesses to find help and advice. Rolling out the “Made Smarter” service nationwide, which currently only extends to a pilot scheme in the North West, would help and its crucial the Government funds an impartial source of advice for businesses.

Our research base needs support too by ensuring our universities have access to researchers, investment and projects from around the world.

Automation offers opportunities to bring benefits to workers. With the shift to robotics and automation comes opportunities for reskilling, and chances for people to flourish in design, building and programming robotics, and automation and data technologies. There must be a massive expansion of lifelong learning to ensure people have the skills and knowledge to take advantage of the new opportunities in areas where jobs will likely be created in the years to come. Opportunities must not just fall to those with the ‘right’ degrees and skillsets.

Alongside support for reskilling workers, we must make sure that the regions of the UK are properly supported to ensure everyone benefits from the opportunities and can respond to the challenges posed by robotics. The Government must provide local areas with the resources and incentives needed for the transition to automation.

Recent technological developments have brought increasing convenience to many people’s lives but it has also led to increasingly powerful and monopolistic businesses. To ensure a fairer society, it is vital that the contribution of workers who help create the wealth is properly recognised. We should consider ownership models such as co-operatives and bring in effective tax policy and employment legislation so that these big tech firms aren’t securing vast profits on the backs of ruthless exploitation.

There is now an opportunity to capitalise on the benefits of automation, but this cannot be left to chance. The Government has failed to provide the leadership needed to help drive investment in automation and robot technologies. If we are to reap the potential benefits of improved living standards, more fulfilling work, and the four-day working week, the Government needs to do more to support British businesses and universities to collaborate and innovate and to support communities as we transition to greater automation in the work-place.

Productivity, economic growth, and ultimately job-creation and higher earnings, will flow to those countries that capitalise on new technologies. The Government must act without delay.

Rachel Reeves is the Member of Parliament for Leeds West and Chair of the Business, Energy and Industrial Strategy Select Committee