Automation Threaten Retail Jobs

Report: Automation threatens up to 7.5M retail jobs

Dive Brief:

  • Between 6 million and 7.5 million retail jobs could be eliminated by automation in the coming years, according to a recent study conducted by Cornerstone Capital Group for the Investor Responsibility Research Center Institute (IRRCi).
  • The report, “Retail Automation: Stranded Workers? Opportunities and Risks for Labor and Automation,” suggests that retail cashier jobs, 73% of which are held by women, are at highest risk of loss to automation technologies.
  • About 16 million Americans are employed in retail, which represents 10% of the nation’s working population and generates 6% of U.S. gross domestic product, according to the report, which criticizes the “lack of disclosure on key labor metrics by retailers” that essentially leaves investors in the dark on how these companies are responding to the automation trend, and what the fate of their workers could be.

Dive Insight:

As retailers leverage technology to optimize their operations, industry jobs are changing rapidly — and in some cases they’re disappearing altogether.

“The retail landscape is changing rapidly and investors need to understand the social and governance issues impacting valuations for public companies in this sector,” Erika Karp, Cornerstone founder and chief executive officer, said in a statement. “Retailers are facing a perfect storm: they need to balance demand for wage increases with the negative optics of future job losses. The winners in retail will be companies that provide recruitment, retention and training for workers and innovate with forward-thinking future store strategies.”

Some retailers are finding ways to retain employees and shift their roles. Boxed.com, for example, recently announced a plan to automate one of its fulfillment centers while retraining the human employees who work there and adapting their jobs.

The main purpose behind IRRCi’s research, judging from its mission, is to get more companies to acknowledge the degree to which automation is replacing or displacing human jobs. More broadly, the aim could be to get more companies to take the level of responsibility that Boxed.com has taken in figuring out what the next step can be for displaced human employees — although it might just be that IRRCi wants more disclosure of information to aid investors.

Either way, highlighting how automation is affecting jobs might be the best we can hope for in a rapidly changing retail world. Automation and robotics are changing and replacing jobs at many levels of retail, to be sure. IRRCi’s finding that retail cashier jobs are most at risk comes as Amazon is intent on creating “checkout-free” grocery stores that don’t have human cashiers. Also, at the 2017 Retail Business Technology Expo​, Anita Liu Harvey, vice-president of strategy and innovation at Barclaycard, recently described the process of paying at stores as a point of friction best eliminated from the shopping process through automation.

Previous studies have also acknowledged the prospect of robots replacing humans in the workforce. In September, Forrester released a report anticipating that robots will eliminate 6% of all U.S. jobs by 2021. There are still many unknowns as to how and when automation will affect the retail workforce, but IRRCi’s push for a better, more detailed understanding of how automation is really changing retail organizations, will help the sector to better prepare for what may be inevitable.

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