Rethinking Automation: Is Machine Replacement A Good Way To Alleviate The Difficulty Of Recruitment

In the past decade, the challenges faced by China's export processing manufacturing industry have become increasingly fierce, and the problem of recruitment is the first.

Objective reasons show that since 2011, the population of working age in China has undergone structural changes. According to the seventh national census, the working age population between 16 and 59 years old in China is 880million. In terms of total, the number is down by more than 40 million 

compared with the sixth national census in 2010; In terms of proportion, the proportion of the working age population in China to the total population has also decreased.

At the same time, with the development of the central and western regions, the gap between the region and urban and rural areas is narrowing, migrant workers gradually change from cross provincial flow to local employment, which leads to frequent labor shortage in coastal areas.

Subjective reasons show that even in recent years, the minimum wage standards of various regions have been gradually raised, the income of migrant workers is still at a low level, which is difficult to bear in the high cost of living in the city. Combined with the rigid management mode in the factory, the willingness of migrant workers, especially the younger generation, to the production line work is constantly reduced.

In 2020, influenced by COVID-19, enterprises resumed their work and resumed production and faced more serious recruitment difficulties. The large-scale flow of migrant workers from the central and western regions to the southeast coastal areas is restricted by the requirements of traffic closure and isolation. In order to solve the problem of efficient production, enterprises speed up the process of automation.

Statistics from Ministry of industry and information technology show that China's industrial robot production exceeded 180000 in January October 2020, an increase of 21% year-on-year. The revenue of industrial robot manufacturing enterprises above scale was close to 40billion yuan, and the profit reached 920million yuan, which is a rare growing industry during the epidemic. In the service industry, more and more hotels introduce robots to carry out daily disinfection, meal delivery and other work, greatly reducing the demand for manpower.

Before that, in order to solve this problem, the government and enterprises have vigorously advocated and promoted the automation upgrading of production process, which is shown in the increasing number of industrial robots.

In 2013, China has surpassed Japan to become the world's largest industrial robot application market. In 2019, the total installed capacity of industrial robots in China has reached 783000. Under the influence of COVID-19, the application scope and scale of automation equipment represented by automatic mask machine has been further expanded from last year to now.

In this context, the labor market will inevitably be affected by the upgrading of manufacturing automation: on the one hand, in order to meet the requirements of the upgrading of skills brought by production automation, some young and learning workers have the opportunity to be selected by the enterprise to participate in skills training and to transform into new technical workers who master the technical requirements of industrial robots. On the other hand, a large number of unskilled migrant workers are replaced by robots.

Although the problem of employment difficulty can be alleviated to some extent, the technical unemployment has a great impact on them and deserves attention.

How do machines replace human beings？

The author has done field research in the Pearl River Delta from 2018 to 2019.

As far as motivation is concerned, local governments, in order to optimize the industrial structure and cultivate new economic growth momentum, actively promote "machine replacement" and provide a large number of financial subsidies.

The fundamental driving force for enterprises to implement "machine replacement" is to improve production efficiency and product quality with the help of the sustainability and stability of industrial robots. Reducing production cost is only a relatively minor consideration.

In terms of industry, automobile, electronics and household appliances are the most representative industries applying industrial robots. Especially in the automobile production process, stamping, welding, painting and final assembly need a large number of industrial robots, some even achieve 100% automation.

In terms of function, welding, stamping, handling, palletizing, polishing and spraying are the main applications of industrial robots in the production line, which are used to replace workers to perform repetitive, fatigue and dangerous work.

The research of sun Zhongwei and Deng Yunxue shows that it is more common for manufacturing enterprises to use industrial robots in Guangdong, and half of the enterprises in their sample have begun to implement "machine replacement".

In recent years, the supply of industrial robot system integrators and ontology manufacturers that I interviewed at that time has also increased rapidly.

According to the government's public information, from 2014 to 2017, a total of 2698 enterprises in Dongguan applied for the "machine replacement" special fund, with more than 70000 new equipment. From 2015 to 2017, Foshan has supported 368 "machine replacement" projects, with more than 7000 robots.

These data help to estimate the scale of technical unemployment.

Dongguan officials, for example, expect the "machine replacement" project to reduce employment by 190000. At present, there is no national or regional relatively accurate and comprehensive data to reveal how many migrant workers are replaced by industrial robots, but the qualitative and quantitative studies of different students reflect that this problem can not be ignored.

Sun Zhongwei and Deng Yunxue analyzed the questionnaire samples of 299 manufacturing enterprises that have implemented "machine replacement" and found that each enterprise reduced 96 employees on average, accounting for 9.58% of the total number of employees. Among these replaced workers, 89 were general workers, accounting for 90.66%.

Based on the empirical data of "China's enterprise labor matching survey" from 2015 to 2017, Cheng Hong and others analyzed that the overall substitution effect of robots on labor-intensive industries is 2.9%, but the overall substitution effect on China's labor market is about 0.3%.

The author thinks that the difference of robot replacement rate for workers in different industries mainly depends on the path and scale of enterprise automation upgrading.

Generally speaking, if small and medium-sized enterprises choose to use a few robot workstations to carry out dangerous and repetitive positions such as welding and palletizing, the number of replacement workers is relatively limited. If a large enterprise realizes a high degree of automation of the whole assembly line and even all workshops, the number of workers affected will increase greatly.

As far as the enterprises investigated by the author are concerned, a robot can basically replace 3-4 people, and the overall reduction in the number of employees is between 10-30%.

Who did the machine replace？

From the perspective of employment difficulty, the automation trend of Chinese manufacturing industry is difficult to avoid, but the subsequent technical unemployment seems to not cause too much attention, which is closely related to the implementation strategy, technical discourse and localism adopted by enterprises and governments.

First, the decision-making of industrial upgrading of enterprises does not need to listen to the opinions of migrant workers, they can only accept passively.

Moreover, the automation transformation of enterprises is not in place at one step, but in the process of gradual implementation. By "natural loss", the scale of employees is reduced, such as non renewal after the contract expires and overtime to leave the workers, so that enterprises are not responsible for and pay compensation for technical unemployment.

In addition, even if companies need new types of technical workers to operate industrial robots and automation equipment, they tend to hire directly in the labor market. The cost of internal training is high, and it is also faced with the risk of being dug by peers.

Secondly, under the background of the current technology competition, technology determinism occupies the mainstream of public opinion. To some extent, the so-called high-end industry and low-end industry are opposites formed mechanically, ignoring the long-term and complexity of the upgrading of labor-intensive industries. The result is that the low-end manufacturing industry must be eliminated in the media.

Therefore, when the low-end migrant workers are replaced by industrial robots representing high-end technology, people see more about the so-called technological progress to create new jobs, and the unemployment problem is ignored instead.

On the other hand, migrant workers will also attribute unemployment to their own lack of technology and ability, and it is natural to be replaced. This kind of exposition the author hears a lot of migrant workers in the field investigation.

Finally, under the dual labor market, the urban government is not responsible for the unemployment of migrant workers, but may promote their return to the countryside and revitalize the countryside.

In this way, urban governments can reduce the burden on social governance and public services, leading to direct or indirect drive by some cities to expel "low-end population".

However, because the rural society does not have enough jobs to support large-scale migrant workers returning home, with the unemployment problem transferred and spread, the consequences are that social inequality is further worsening between regions and between urban and rural areas.

For the above three reasons, the automation upgrading of manufacturing industry will gradually have a negative impact on the older, lower education level, lack of skills, especially female migrant workers.

These workers are limited by objective conditions such as age, gender, learning ability, etc., and it is almost impossible to return to the labor market through internal and external vocational training to achieve skills upgrading.

Although some enterprises will send these people to other factories, departments or posts by means of post transfer, they are often not adaptable to new jobs.

This is the case with a worker in an automobile parts factory that I interviewed. Because of the technical transformation of the production line, he was transferred from production post to quality inspection post, but the final result was left.

In addition, some jobs with certain skill requirements and dangerous ones, such as welding and spraying, will reduce the occupational disease injury of migrant workers, although the introduction of robots will reduce the occupational disease injury of migrant workers, but when they change from technical post to ordinary post, income decline is a high probability event.

Perhaps they can take some protest action, but the effect is relatively limited. One is that these workers tend to be less, and the other is that their structural strength based on expertise has been weakened compared to stable, precise, and continuous welding and spraying of robots.

Where's the replaced person

It is an indisputable fact that the upgrading of manufacturing automation leads to technical unemployment. Even so, the overall scale is still hard to measure, and its impact on the labor market has been apparent.

According to the experience of European and American countries, the main negative impact of the use of robots on low skilled migrant workers is to force their employment to transfer from manufacturing industry to service industry.

Moreover, the lower the education level of migrant workers, the more obvious the cross industry transfer. This may be the reason why only 27.61% of the people in sun Zhongwei's and Deng Yunxue's research worry about technical unemployment due to machine replacement. More than 70% of the other respondents may think that it is easier to find a new job in the service industry.

An interviewee of the author is a typical example. He used to operate CNC machine tools in the factory for many years. Now because all CNC machine tools have been automated, he can only switch to do foot massage.

According to the "migrant workers monitoring survey report" released by the National Bureau of statistics, in 2018, the proportion of migrant workers' employment in the tertiary industry exceeded half for the first time, reaching 50.5%. This data also confirms the trend of employment from industrial manufacturing to service industry.

However, this does not mean the improvement of labor productivity in China's economy. On the contrary, a large number of migrant workers are still engaged in low skilled jobs such as household cleaning, online car hailing, take away riders and daily knots.

The salary may be increased, but this kind of work is usually short-term and temporary, which may require more working hours and emotional labor, and lack of social security.

Once they encounter disputes such as labor infringement, it is difficult for them to protect their legitimate rights and interests through labor laws and regulations. The probability and frequency of frictional unemployment in such unstable jobs are greatly increased.

From this point of view, the labor degradation caused by "machine replacement" is more reflected in the process of migrant workers' cross industry employment. Compared with manufacturing workers, service workers' workplaces are scattered and their working hours are not concentrated, which makes them more atomized. This naturally limits the possibility and influence of their "wildcat like" collective action.

Therefore, even if the suffering of these workers can arouse the sympathy of the public, it is difficult to organize and mobilize any force for change in the structural obstacles.

On the other hand, manufacturing automation may lead to "polarization" of China's employment structure, which makes it more difficult to cross the middle-income trap.

As early as the 1980s-1990s, the labor market of developed countries in Europe and the United States was polarized because of technological progress, that is, the employment share and wages of high skilled and low skilled workers increased gradually, while the employment demand of medium skilled workers decreased significantly.

The quantitative research of some Chinese scholars shows that the trend of polarization in manufacturing industry is emerging. The author observed that only a small part of migrant workers can upgrade their skills and benefit from automation, and most of them suffer from labor degradation or technical unemployment.

Although their wages for domestic work, express delivery, take out and other jobs have increased, to a large extent, they are not compensated by the purchase of social security.

In general, the author believes that automation can not be the only solution to the development of China's manufacturing industry.

"Machine replacement" requires high capital investment, even if the government provides subsidies, enterprises still need a lot of investment, which is a certain risk for export-oriented enterprises. In case of order reduction or even cancellation, automation is not worth the loss. Therefore, the automation upgrading of manufacturing enterprises will still be a long-term, gradual and tortuous process.

Although the automation process of enterprises is accelerating in response to COVID-19, the shortage of new skilled workers in the labour market is also beginning to appear. Thus, without the improvement of vocational education and social distribution system, pure technology investment can not achieve a great increase in total factor productivity.

Advanced machinery and equipment need new skilled workers with special skills to install, operate and maintain. In this regard, let more migrant workers participate in vocational skills training, transform into new skilled workers, and enjoy more economic and social rights is the direction that needs to continue to promote.

But the construction of skill formation system. Not in a day. The state can invest a lot of resources to improve the hardware teaching ability, and there are also challenges in the construction of teachers of related technology majors. Due to the low treatment of vocational education, it is difficult to attract people with practical ability and theoretical level to join.

Although there are various problems in the manufacturing industry, in the past 40 years, a set of legal regulation system has been established to guarantee the basic rights of migrant workers.

In contrast, the service industry is still in a wild state: the confirmation of labor relations, the coverage of social security, the promotion of dispute settlement, and the intervention of trade unions all need to start from the foundation.

(the author is a doctor of sociology, Jena University, Germany)