Technological unemployment risk is real, new group warns

Technological unemployment is a looming threat to the U.S. workforce, argues Michael Lotito, a prominent labor law attorney. But with the unemployment rate at a 50-year low, it's not easy to convince people of it, he admits.

Lotito is president of the Emma Coalition, a newly formed, nonpartisan group that is backed by the National Restaurant Association. The restaurant industry is responsible for about 10% of the national employment. It is an industry that is automating.  

Lotito is co-chairman of Littler Mendelson's Workplace Policy Institute and is a former chairman of the Society for Human Resource Management or SHRM. The Emma Group is working with federal, state and businesses to discuss the impact on technological employment and how it can be mitigated. He says HR managers will have a major role in this effort.

In this Q&A, Lotito discussed automation, technological unemployment, and the goal of Emma, which is named after Lotito's granddaughter.

Editor's note: This Q&A was edited for clarity and length.

Past waves of automation have led to new industries and jobs. Employment overall has increased. But some believe this next wave of AI and robotics automation will be different and lead to significant technological unemployment. Where do you stand?

Michael Lotito

Michael Lotito: We believe the job displacement will be much more rapid than it has been in the past. We're not saying that it's necessarily going to be mammoth job destruction. Clearly some jobs are going to go away, but a lot of new jobs are going to be created. The concern is we have no plan for dealing with it. Without a plan, we're going to be in a world of hurt.

One of the groups you represent are restaurants. Can you illustrate how automation might impact that particular industry?

Lotito: One in three people get their first [employment] start in a restaurant. The restaurant industry employs roughly 15.5 million people, or about 10% of the American workforce. When you look at the jobs in some restaurants like fast food, where repetitive skills are needed, those are the types of things that clearly AI and robotics are going to be designed to replace. There is tremendous pressure in the restaurant industry on unit labor costs because of compliance issues. Companies in that space are really getting squeezed. You can see where that industry could be seriously at risk.

What does this mean in terms of skills?

Lotito: The idea is to focus not only on the skills that are going to go away, but on the skills that are going to be needed. If you're going to have a kiosk, somebody is going to have to be able to repair the kiosk. In this example, is there going to be a net gain of jobs? There may not be. The next question is: What are the career paths that might be given to those individuals to do other things?

Are you saying that some government policies, such as increasing the minimum wage to $15, will accelerate automation adoption?

Lotito: Yes, I think so. I talk about lifelong learning. The $15 is not going to be very meaningful if you don't have a job. The real issues are, for instance, how do you get a lifelong learning account or become able to constantly update your skills.

What is a lifelong learning account?

Lotito: It gives individuals, much like a 401(k) account, an opportunity to continue to access training, so that their skills can continue to evolve over time. How do we make these kinds of training programs and opportunities available to individuals? How do they pay for them? What is the obligation of industry in order to fund them?

What is the Emma Coalition trying to do?

Lotito: Our ambition is to try and help reinvent the American workforce. We want to use the restaurant industry as a model perhaps for other industries. We are engaged with the state of Washington with their Future of Work Task Force. They're the first state in the country that has enacted legislation to study the impact of AI and robotics. This task force is scheduled to issue a report toward the end of this year that will include recommendations for the legislature to consider. We think other states will do similar things.

You argue that people, for the most part, aren't aware of what automation will bring in terms of job displacement. Why is that?

Lotito: The irony is people are saying, 'You're talking about replacing people. I can't even find people.' Since it's not the crisis of the day, they're not thinking about it.

When you tell someone that we are heading into a crisis, what does that crisis look like?

Lotito: Increased unemployment as a result of people utilizing AI and robotics. The skills that are necessary to deal with the new jobs are not going to be there, meaning that those jobs are not going to be filled.

What should HR be doing in response?

This is one of the most important strategic issues of our time from an HR perspective.

Lotito: This is one of the most important strategic issues of our time from an HR perspective. HR professionals should be thinking about what jobs do we have in our company that are at risk? What are the jobs that are going to be evolving? How are we going to deal with our existing workforce? What responsibility do we have to individuals that might be displaced? What responsibility do we have to our existing workers to begin providing them with additional skills?

How do we change the culture of our organization and the culture of America that says we only hire individuals that are qualified? And we're afraid that if we engage in aggressive training programs that the individual will leave us and go someplace else.

How rapidly is this problem arriving and when do you think we might reach a crisis point?

Lotito: Experts more informed than me are saying that the crisis point could be as early as 2030.