Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 257

Robots and AI will automate workplaces at a frenzied pace

Believe it or not, a motion to the European Parliament recommends that autonomous robots be deemed 'electronic persons'. The motion suggests that self-learning robots, those that make independent decisions and interact freely, be held to have an 'electronic personality'.

The proposals in the 2017 motion aren’t as bizarre as it might seem because companies are already ‘legal persons’. Such a status means businesses can be held responsible for damages and can insure against such costs. Giving the same status to robots before they become ubiquitous in the workplace and elsewhere would allow likewise.

Even so, about 150 experts in science, law, ethics and other fields slammed the recommendations as inappropriate, ideological and non sensical in a petition to the European Commission. A core complaint was that deeming robots as ‘persons’ would absolve from liability the humans behind a malfunctioning robot.

Political challenge of robots and AI

The legal status accorded to robots is one of countless political issues policymakers must resolve ahead of an expected leap in automation driven by gains in artificial intelligence and robotics. The biggest political challenge arises if the automation likely during the ‘fourth industrial revolution’ were to cause massive unemployment – and a huge number of jobs are thought to be at risk. A just-released OECD study says that 46% of jobs in 32 developed countries are likely to be “significantly affected” by automation over the next 20 years. Other (but not all) studies offer similar forecasts.

Economically, automation will make sense, especially in ageing societies where shrinking workforces put upward pressure on wages. Boston Consulting Group, for instance, says that automation, once installed, cuts manufacturing costs by up to 20%. Robots and algorithms will thus boost productivity and in general, long-term living standards.

At a political and social level, however, the ramifications of automation could be fraught. Robots and algorithms are poised to destroy countless low- and semi-skilled jobs. While they will create jobs, these jobs are likely to be of the type (higher- and lower-paying ones) that hollow out the middle class. The social safety nets in place to limit any populist backlash against automation and society’s ability to retain the displaced appear inadequate to cope with any lasting increase in unemployment and inequality. To stop political disgruntlement nullifying automation’s economic benefits, policymakers will need to find better solutions than those offered so far, such as taxes on robots, jobs for all or universal basic income. It could be this era’s defining political challenge.

Room for more optimism

Some caveats. A lasting rise in joblessness due to automation is just speculation. It may never happen. Warnings about automation are perennial. The mistake the pessimists usually make is to underestimate the number of jobs that advances create. Many service jobs are immune, even if robots might help these occupations.

The challenge for policymakers, though, is that the upcoming automation threatens to be unprecedented in terms of scale and speed. While the rise of robotics and artificial intelligence herald a more prosperous longer term, fewer opportunities and reduced financial security for voters could jolt politics in unpredicted ways in the nearer term.

Policymakers can see that the dangers of the ‘gig’ economy are likely to demand greater government intervention against market forces. They have time to find solutions.

 

Michael Collins is an Investment Specialist at Magellan Asset Management, a sponsor of Cuffelinks. The full version of this article is available here.

 

  •   6 June 2018
  •      
  •   

 

Leave a Comment:

RELATED ARTICLES

AI is running ahead of its ethical issues

The US$21 trillion question: is AI an opportunity or excess?

The future of travel

banner

Most viewed in recent weeks

The ultimate superannuation EOFY checklist 2026

Here is a checklist of 28 important issues you should address before June 30 to ensure your SMSF or other super fund is in order and that you are making the most of the strategies available.

Noel Whittaker’s take on the budget

Marketed as a fix for inequality and housing affordability, the latest budget instead delivers a tangle of tax changes that leave everyday Australians worse off.

Australia has no death duties. Technically.

Australia may not levy formal death duties, but a growing web of tax measures is quietly shaping what wealth passes between generations. Now, the 2026 budget adds another layer.

Lithium's rally is real this time – but no-one trusts it

The lithium rally mirrors the early-2010s tech stock surge, with demand set to double by 2030. Supply has been slow to respond, creating a market deficit for future tech like humanoid robotics and solid-state batteries.

Welcome to Firstlinks Edition 662 with weekend update

The debate over the budget is increasingly shaped by frustration and perceptions of unfairness, rather than clear-eyed assessment of policy outcomes.

Two months into retirement

A retirement researcher's take on retirement and her focus on each of her six resource buckets to stay engaged during the transition and beyond.

Latest Updates

Are the government’s CGT changes better for young investors?

New CGT rules promise fairness, but could young investors lose out? A practical scenario reveals how changes impact deposit goals, investment choices, and long-term wealth building for the next generation.

Retirement

How to minimise tax with a will

Inheritance tax implications in Australia may surprise some, as poor estate planning without proper wills or trusts can lead to costly tax bills and delays for beneficiaries.

Investment strategies

AI can’t pick winning funds, but it can help you avoid losers

Machine learning has been touted a game changer investment management. But a new study overturns claims that AI can generate positive alpha in mutual funds. Here are some practical takeaways for investors.

Investment strategies

Inflation BIG picture: Boomers got lucky, next Gen not so much

A 150-year view shows inflation's upward bias, driven by shifting monetary regimes and war stocks. This marks an end to the low-inflation boom that enriched boomers and ushers in a higher-inflation era for younger investors.

Planning

Tax deductibility of financial advice improves affordability

A shrinking adviser workforce and rising costs are squeezing access to financial advice, just as demand surges. Expanded tax deductibility offers a modest but meaningful boost to affordability.

Retirement

Retirement in reality – 3 months in

A reflection on travel mishaps, smart decision-making, time pressures and rebuilding health habits. Three months in, here's how to navigate the surprising realities of life after work.

Taxation

Calculating the business cost of Australia’s new 'productivity tax'

Amid a national productivity crisis, new economic analysis finds the tax changes in the 2026 Federal Budget create Australia’s first-ever by design 'Productivity Tax', where young people will pay the biggest price.

Sponsors

Alliances

© 2026 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.