Google's Hal Varian on how robots will change our future

Google’s Chief Economist Hal Varian believes robots will be essential in helping us adapt to a shrinking workforce due to an ageing population, but fears of a robotic takeover and mass unemployment are unfounded.

Robots will augment rather than replace jobs because human skills and cognition are harder to emulate than we realise, said Dr Varian at an event hosted by UTS Business School and the Centre for Policy and Market Design.

“You would expect robots will reduce the demand for human labour, but what people forget is that we are entering a period where we will also see quite a significant reduction in the supply of labour,” he said.

Dr Varian has worked at Google since 2002, and has been involved in many aspects of the company, including auction design, econometric analysis, finance, corporate strategy and public policy. Google controls about 90 per cent of the internet search market in Australia.

Dr Varian is also emeritus professor at the University of California, Berkeley, in three departments: business, economics, and information management, and is the author of a bestselling book on business strategy, Information Rules: A Strategic Guide to the Network Economy.

“For centuries people have been concerned about machines and robots stealing jobs, but of course during that period we have seen dramatic increases in prosperity and dramatic increases in employment as well,” Dr Varian said.

“During the 20th Century it has always been pretty easy to find workers but in the 21st Century – the next 25 to 30 years – the demographic data suggests it is going to be rather difficult,” he said.

Another important element to consider when determining the role of robots in the workplace of the future is the difference between jobs and tasks, Dr Varian said.

“There are many tasks that make up a job, and automation can eliminate some of the dull, repetitive tasks, but it doesn’t generally eliminate entire job. There were 270 occupations detailed in the 1950 US Census, and only one has been eliminated due to automation – lift operators,” Dr Varian said.

“Most jobs, even those we think of as relatively low-end jobs, are much more complicated than we realise.”

This was something Elon Musk discovered after attempting very high automation at Tesla, Dr Varian noted. “Yes, excessive automation at Tesla was a mistake. To be precise, my mistake. Humans are underrated,” said Musk in 2018.

While it is a popular science fiction fantasy to imagine a world full of humanoid robots, Dr Varian argued these type of robots are not the best solution to complete a task efficiently.

“Washing machines, dryers, dishwashers, vacuum cleaners, sewing machines. None of these work like humans,” said Dr Varian.

“We don’t know what technology will look like in 20 years or even 10 years, but if we look at the 10 largest occupations in the US and Australia – jobs such as nursing, retail sales, customer service –  these account for around 21% of total employment.

“These jobs are too complicated for a robot in their entirety, although certain tasks associated with them could be made more user friendly,” Dr Varian said.

In the past, machines have primarily helped with manual tasks, however in the future they will provide more cognitive assistance, Dr Varian said. This will help people perform their jobs more effectively.

Job related skills will also be easier to acquire through online learning channels such as YouTube.

“It used to be that as a cashier you required maths skills, to be a writer you needed to know how to spell, and to be a taxi driver you had to know the city streets, but these things are no longer necessary. They can now all be done on your phone,” Dr Varian said.

More automation may also mean that we simply have more leisure time – working perhaps four days a week rather than five. Working hours have already decreased significantly from past levels and vary considerably around the world.

Many countries around the world face an ageing population and declining participation in the workforce, particularly countries such as Japan, South Korea and China – where the former one child policy will likely have a significant impact.

These countries are investing heavily in automation, said Dr Varian. Australia and the US face similar challenges, so it is likely that robots will be our saviour rather than our greatest concern.