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Will US workers lose jobs to robots? Mnuchin says no, report says yes

Nearly 40 percent of US jobs are at risk of being taken over by robots within about 15 years, a new report by consultancy firm PwC said on Friday. But Treasury Secretary Steve Mnuchin says he is not worried. 

U.S. Treasury Secretary Steve Mnuchin after meeting with German Finance Minister Wolfgang Schaeuble in Berlin, Germany last week.
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Will robots replace US workers? US Treasury Secretary Steve Mnuchin and PwC apparently have different answers. 

Nearly 40 percent of US jobs are at risk of being taken over by robots within about 15 years, says a new report by consultancy firm PwC. Yet, US Treasury Secretary  disagreed, saying on Friday morning that he was not worried about the mass displacement of US workers by the breakthroughs in artificial intelligence (AI).

“It’s not even on our radar screen… 50 to 100 more years,” Secretary Mnuchin said at Axios’s New Shapers event. “I’m not worried at all…. In fact I'm optimistic.”

But the PwC report said the opposite, predicting that 38 percent of existing US jobs face the potential threats of automation, followed by 35 percent in Germany, 30 percent in Britain, and 21 percent in Japan.  

“A key driver of our industry-level estimates is the fact that manual and routine tasks are more susceptible to automation, while social skills are relatively less automatable,” Jon Andrews, head of technology and investments at PwC, said in a statement. “That said, no industry is entirely immune from future advances in robotics and AI.”

While the United States and Britain have relatively similar economies, according to the report, several sectors create a significantly higher risk of job replacement in the States. Among industries most at risk, the PwC report suggests, are the financial and insurance industries, which are estimated to be 29 percent more vulnerable to automation, with 61 percent of jobs in the sector estimated to be on the line in the States and 32 percent in Britain.

"The jobs of these US retail financial workers are assessed by our methodology as being significantly more routine, and so more automatable than the average finance sector job in the UK, with its greater weight on international finance and investment banking," the researchers wrote.

According to the report, the rapid development of autonomous cars means that the transportation and storage sectors are predicted to have the highest potential automation rate, with 76 percent of those jobs susceptible to being filled by robot workers in the near future. 

Less educated workers, who are more likely to work in sectors such as manufacturing and retail, face the highest level of threat from AI, the report stated. 

The replacement has already happened in some sectors. A new cafe opened at the end of January in San Francisco “employed” a robot to act as a barista in an entirely automated system, The Christian Science Monitor noted. 

Yet, as automation reshapes the US labor force, it does not just kill jobs – it may also add them, the Monitor’s Laurent Belsie noted.

“The automation that was supposed to obliterate tens of thousands of jobs seems on closer examination less like a steamroller and more like a water flume, full of twists and turns that will transform jobs in unexpected ways," wrote Belsie. "It will replace some positions and create new ones, not as some irresistible force but shaped by what consumers want, how governments regulate, and the evolution of cultural norms.”

An automated workforce will also need to overcome several hurdles, said study author John Hawksworth, chief economist at PwC. 

“Just because it is technically feasible to replace a human worker with a robot, doesn’t mean it’s economically attractive to do so,” Mr. Hawksworth said in a statement. “Levels of automation will depend on the relative cost and productivity of robots compared to human workers in carrying out different types of tasks.”

Robots could also help to raise wages, the PwC report suggested. 

"Average pre-tax incomes should rise due to the productivity gains, but these benefits may not be evenly spread across income groups," the report said.