Walmart (NYSE:WMT) is now using robots to help employees track and shelve inventory, among other things. And while the company says its machines won't cost any human workers their jobs, smaller crews at the company's stores would appear to be an inevitable -- and intentional -- result of automating more tasks.
The retailer's efforts have gained attention because customers can see real, autonomously operating robots working in stores as they shop. In reality, automation has been eliminating jobs in less flashy ways for years -- for instance, via self-checkout.
In-store robots may have their limits, but automation can, and will, take warehouse and distribution jobs in the near future. Amazon (NASDAQ:AMZN) has already been successfully testing those technologies.
The warehouse of the future
Amazon and other large e-commerce businesses have an enormous task when it comes to packing and shipping orders. Humans can only work so fast, and we make mistakes, need breaks, and call in sick.
That's why Amazon has begun testing automation that will pick and pack our orders, according to USA Today. The retailer explained its efforts in a statement sent to the newspaper.
"We are piloting this new technology with the goal of increasing safety, speeding up delivery times and adding efficiency across our network," read Amazon's statement. "We expect the efficiency savings will be reinvested in new services for customers, where new jobs will continue to be created."
The statement parallels those issued by other companies on this front. McDonald's has said that the digital ordering kiosks it's installing across the chain won't lead to lower headcounts in its stores. And Starbucks (NASDAQ:SBUX) has said as more people use its mobile order and payment app, reducing the need for cashiers and order-takers, its plan is to move more workers over to making drinks, rather than operating its coffee shops with fewer people.
That's more believable in the case of operations where square footage is limited. There's only so much room behind a Starbucks counter, so the space not occupied by the body of a person taking orders or processing payments could instead be filled by someone making the chain's often-complex beverages.
At an Amazon warehouse, that's a less plausible scenario (and a Reuters article estimated that 24 jobs would be eliminated in each facility by automation). While the e-commerce leader will certainly add staff in other areas, once these order-filling machines are deployed widely, it's unlikely to need nearly as many low-skilled workers as it does now.
That's a trend that's not unique to Amazon. Multiple companies now sell off-the-shelf warehouse automation solutions -- and a number showed them off at the recent Shoptalk conference.
You need skills to pay the bills
Automation has been replacing manual labor since the dawn of the Industrial Revolution. When it became cheaper to haul goods using trains compared to wagons, some wagon-driving teamsters lost their jobs. Forklifts have replaced strong people in countless moving-things-around roles, and self-checkout machines have certainly lessened demand for cashiers.
It's a simple cost-benefit analysis. If a company can afford the upfront investment in machines to do any set of tasks, and the payoff in terms of lower workforce expenses will outweigh the costs, those tasks will become automated.
Nobody questions why retailers use a point-of-sale systems to track sales and inventory instead of physical ledger books. Eventually, nobody will question the use of automation in warehouses, or on the shopping floor.
It may take a while -- smaller companies with fewer resources won't move as quickly -- but eventually, automation spreads. That makes it essential for workers to continue to grow their skill sets. And the soft skills and flexibility that are hardest to automate will doubtless be the attributes that employers will need most.
Cool robots or no cool robots, for the foreseeable future, the human element will not be replaceable.