A Frontier Editorial
Frontier | Vol. 49, No.30, Jan 29 – Feb 4, 2017
The corporate bosses see labourers as ‘waste People’ and the changing industrial landscape not so much a source of plenty but a ‘wasteland’, rather a dumping ground for those they see as the dregs of society. Jobs in traditional manufacturing sector are vanishing very fast. Yet the jobless are trying to cling to the very ‘wasteland’ because they have nowhere else to. Nor do they know the new world where ‘‘new collar jobs’’ are available. Modi’s campaign for ‘Digital India’ is basically aimed at opening door to IT sector multinationals. To think of generating jobs in manufacturing now looks absurd, if not utopia. For all practical purposes, the age of industrialisation is coming to an end with robots set to destroy labour intensive manufacturing jobs globally. Industrial revolution happened hundreds of years ago and the world is now all set to embrace fourth industrial revolution with robotics having all pervading sway in every sector of manufacturing. And China shows the way. It’s the global leader in automation. Strangely enough, major industrial powers, including America, are now worried about Chinese capitalism, not socialism. What a radical shift in ideological orientation! The idea of encircling ‘global cities’ by ‘global villages’ now mocks at itself. After all Lin Piao became a closed chapter long ago, so is Mao. What is more China is said to have changed capitalism fundamentally, challenging some basic questions about the relevance of capital allocation decision. In truth the working class party, the Chinese Communist Party, no longer needs workers to hold high the banner of Red Flag. They are getting rid of workers step by step.
The forces of specialisation, combined with differing average wages globally, led to industrialisation of South Asian and South East Asian countries over the last five decades or so as manufacturing was outsourced by industrially advanced countries to backward countries. Low-cost manufacturing has bounced around mainly China, Vietnam, Bangladesh, Taiwan, Singapore, Thailand and the Philippines. The contradiction between high-cost employees and low-cost manufacturing has played havoc in labour market globally.
The latest phase of automation, more preciously robotisation is going to drastically alter the entire manufacturing scenario throughout the world while making many labour-related concepts obsolete. Modi’s ‘Make in India’ slogan has failed to attract foreign investment because India unlike China is not yet ready for full automation or robotisation. This way or that robots are finally coming in a big way. And India under the baton of Modi looks too eager to get integrated in the world economy, which is in a crisis of stagnation. Foxcom, a key manufacturing partner for Apple, Google, Amazon and the world’s 10th largest employer has already replaced 60,000 workers with robots. The sheer scale of labour displacement is frithtening. In other words manufacturing bases located in Asia will suffer immensely.
Manufacturing jobs simply aren’t being created anymore because they are all being taken by China’s burgeoning army of factory robots. Modi being a late comer in the game cannot do much other than periodically offering some gimmicks to shift focus from one area to another only to ‘confuse the confused’ further. It’s not just emerging economies that will feel the heat of robots in the coming days. Even America under Trump cannot do much in changing the rules in the middle despite the much touted slogan of ‘Buy American, Hire American’. Donald Trump has promised to on-shore many industries and bring back well-paid manufacturing jobs. But the ground reality is not that encouraging for Trump. In the end out-sourcing is likely to stay in place despite Trump’s radical rhetorics. The barons in industry both here and abroad have taken a ‘wait and see’ policy. Trump, posing as the champion of ‘middle-class’ and working class whites, didn’t offer any real solutions to the effects of trade agreements and globalisation on American jobs and wages, nor did he address the other structural factors, including automation—the burning question of the day.
Automation is the easiest way to cut costs. Indian monopoly houses and their foreign collaborators are not going to oblige Modi by installing huge manufacturing capacities. What all they want is to eliminate labour and robot is the answer. Not for nothing people like Microsoft Chief Satya Nadella and Google CEO Sunder Pichai are regularly visiting India to meet key industry leaders like Anand Mahindra, Shikha Sharma, Mukund Rajan etc.
What the Davos-based elite club of big lords—the World Economic Forum (WEF)—predicted last year, seems to be a reality now—fourth industrial revolution. As per WEF’s forecast 5 million manufacturing jobs will be destroyed by 2020 by the trends. Alarmingly another market monitoring firm analysed that 77% of all jobs in China are at risk of automation and 57% of all jobs across OECD. While lecturing Indian business tycoons Nadella was candid enough to admit the fact that artificial intelligence-oriented innovations would replace ‘some jobs’, rather ‘white collar’ jobs.
The days are not far when even labour-intensive jute industry will use robotics leading to massive retrenchment. As textile industry is already utilising robots successfully, it is a matter of time that more and more industries will switch over to robot-based production system. For employers it is advantageous because robots won’t from unions. Nor would they demand living wages and social security benefits.
The point at issue is how people engaged in labour organising are going to confront the impending catastrophe or what they call fourth industrial revolution. They are actually wandering in wilderness with vacant look as they cannot show any alternative vision to challenge the danger.
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