Australian enterprise is facing a fresh wave of innovation and automation that could replace more than half the current human workforce in some sectors of the economy.
An online predictive analytics tool that provides guidance to enterprises about when to automate, which technologies to leverage first, and how many jobs will be impacted has been released by Sydney-based startup Faethm.
Called Tandem, it’s not cheap – an annual licence to use the product will cost $250,000 – but according to Faethm founder and CEO, Michael Priddis, the insights it promises match those of bespoke consulting services that might cost as much as $5 million.
Later this month Faethm will also publish its first Future Work Index which explores what percentage of Australia’s major workforces face being impacted by automation over the next 10-15 years.
Mr Priddis said that in combination, the Index and the Tandem platform deliver the “most granular view of automation outcomes.”
Besides providing guidance for enterprises seeking to innovate and automate, he said that the findings would provide important insights for investors and help guide future policy development.
Earlier this month a report from AlphaBeta (commissioned by Google) stated that done well, automation could add up to $2.2 trillion to Australia’s GDP by 2030.
It noted however that at present Australian enterprise was lagging the automation efforts of US business.
Besides calling on local business to speed up, the report also recommended that a strong policy framework be developed which ensured workers at risk of replacement were redeployed.
While the report largely dwells on the human upsides of automation – reduced workplace risks and more interesting work as mundane tasks are automated – it acknowledges that; “This is not to say that automation cannot cause unemployment, especially for older and vulnerable workers who lose their jobs and are unable to find a new one quickly.
“If automation in Australia proceeded at its historical pace it will deliver a significant economic dividend of around $1.2 trillion over the next 15 years, but this gain is entirely predicated on our ability to redeploy the workers that are displaced by machines into new forms of work.”
It notes that in some instances automation can lead to higher unemployment or reduced work hours and warns; “If overall employment is reduced, rather than output increased then the potential economic gains of automation could evaporate.”
Mr Priddis said that; “There is a school of thought that robots will create more jobs.
“But I don’t yet see the interventions coming for people in those jobs to take them to those future jobs in the quantities that are going to be automated.”
In a recent opinion piece penned jointly with Ed Husic, shadow minister for the digital economy and the future of work, which appeared in the AFR, Mr Priddis said that Australia was “spectacularly unprepared for automation.”
Data 61 CEO Adrian Turner has been calling for more national discussion about the human impact of automation for several months.
The issue has been brewing for a while; two years ago the Council for Economic Development of Australia warned that as many as 5 million Australian jobs could be impacted by automation. An earlier Oxford University study forecast that 47 per cent of US jobs would be automated in the coming 10-15 years.
Mr Priddis said that Faethm’s soon-to-be released Future Work Index reveals that 57 per cent of Australia’s retail roles face automation, 38 per cent of healthcare, 33 per cent of financial services and 31 per cent of education. The Index also shows that there is a significant gender skew, with women’s roles being more deeply impacted in several industry sectors.
A former regional managing partner for Boston Consulting Group Mr Priddis said; “Because technology is moving so fast they (enterprises and investors) need to know which will have the most impact on your company.”
In the past he said organisations seeking advice would have engaged a firm of management consultants which would assemble a team of ten people, take three months and charge $5 million for a tailored report. “You can now do that instantly,” said Mr Priddis.
He said that the insights from Tandem would help organisations shape their workforce, and also influence other decisions such as whether to sign a 20 year property lease if it was likely that the overall headcount of the company would shrink in that period.
Faethm is also developing a consumer app slated for release later this year that will allow individuals to assess the likely impact of automation on their employment prospects, and also steer them toward retraining or reskilling options to preserve their employability.
The Future Workforce Index has been compiled using public record and company data about the 19 largest industries and features every company with more than 500 people, said Mr Priddis.