First there was outsourcing and offshoring. Now there is something I am calling Autosourcing. Companies and production are returning to the US, but the jobs are not returning with them.
Those jobs are being taken by technology. Improved computers, software systems, cloud computing and robotics have made unprecedented strides in recent years. Experts now largely agree that the age of true automation is upon us, and that many jobs once considered standard will likely never return.
Think about a day in your life as a consumer. You may now purchase air travel and check in at the airport without ever speaking to a human. You can perform all basic banking functions, shop for groceries, consumer goods and home supplies, as well as fill your car with gas without ever interacting with a single employee. You can call a company and get information you need while never speaking with a human soul. The same is true for setting a tee time. The razor you purchased recently was built by sophisticated robots. The books or clothing items you ordered online were sorted and packed largely by machine. And some of us now schedule reminders and appointments by speaking to our phone - not on it. Automation is now increasingly doing the repetitive work; the heavy lifting that humans used to do.
The benefits for companies are far reaching. Computers and robots work long hours. They don't need breaks. They don't call in sick. They make fewer mistakes. They don't need (mandatory) health care. They don't go on strike. They don't file grievances. And it should not go unmentioned that they don't get hurt on the job.
And that will impact workers' comp.
The Associated Press did a comprehensive study regarding this technology trend. They looked at data from "20 countries; and interviewed economists, technology experts, robot manufacturers, software developers, CEOs, and workers who are competing with smarter machines".
Their specific findings included the following, which I pulled directly from an excellent AP article on the subject:
•Over the past 50 years, technology has drastically reduced the number of jobs in manufacturing. Robots and other machines controlled by computer programs work faster and make fewer mistakes than humans. Now, that same efficiency is being unleashed in the service economy.
•Technology is being adopted by every kind of organization that employs people. It's replacing workers in large corporations and small businesses, established companies and startups, schools, hospitals, nonprofits and the military.
•The most vulnerable workers are doing repetitive tasks that programmers can write software for – an accountant checking a list of numbers, an office manager filing forms, a paralegal reviewing documents for key words to help in a case.
•Startups account for most of the job growth in developed economies. Thanks to software, entrepreneurs are launching businesses with a third fewer employees than in the 1990s.
•It's becoming a self-serve world. Instead of relying on someone else in the workplace or our personal lives, we use technology to do tasks ourselves. This trend will grow as software permeates our lives.
•Technology is replacing workers in developed countries regardless of their politics, policies and laws.
While robotics has been making inroads in manufacturing for several decades, experts say the service sector is the new frontier for automation. The key for vulnerable positions is based in the amount of repetitive functions required of them. Cashiers have been a recent target of the automation process. Office assistants, travel agents and others are rapidly being autosourced in this process. Even IT workforces are are being decimated by the advent of the relatively inexpensive and ubiquitous cloud.
Interestingly, experts say the jobs most vulnerable are mid-pay, middle class positions. They seem to be the ones most at risk in both the manufacturing and service sectors. Of course, those jobs represent a significant share of workers' comp activity as well.
While the notion of fewer people being hurt on the job is a good thing, it is a concept that the industry should prepare for. For the workers' comp employee it presents potential double jeopardy. Not only will industry activity potentially be reduced by general automation across numerous sectors, but certain functions within the industry itself are being automated as well. There are jobs within workers' comp that are certainly at risk from this trend.
My own company is a contributor in this process. Our cloud based Flashform SSL system auto-populates hundreds of claims forms directly from carriers and TPA's claim systems. I know that some customers using this service deployed it to replace an archaic and labor intensive form creation and management process. Our Virtual Claims Kit is freeing entire groups at insurance companies dedicated to physically producing, bundling and mailing claims kits to customers. I would like to think we are simply allowing busy people to be repurposed for other important tasks, but that is likely not the reality in all cases.
I have written a fair amount about how technology will impact the workers comp industry. There are many, many positive advantages that we will see. However, it appears for us that the technological advances we are seeing across the world will truly be a double edged sword. The types of injuries and potential long term severity of cases we see will change with the gradual elimination of many of the manual and repetitive tasks our insured's utilize today. Our own workforces will be smaller and more efficient. Change, as is so often the case, will be the only constant we can truly rely on.
And while workers' comp won't ultimately be a casualty of technology, it will likely be dramatically altered by it. Wise people will heed that warning and be prepared to meet our new Autosourcing frontier.
Robert Wilson is President & CEO of WorkersCompensation.com, and "From Bob's Cluttered Desk" comes his (often incoherent) thoughts, ramblings, observations and rants - often on workers' comp or employment issues, but occasionally not.
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