Robot Takeover

Happy fall to everyone. This week is an exciting one for me, as we celebrated the 10-year anniversary of my company MRA Global Sourcing. It’s been an exciting ride, and I’m grateful for my team and all the work we’ve put in over the last decade to help companies find the best talent and candidates in advancing their careers.

We’ve got a great issue for you here. We’re going to take a deep dive into China’s new obsession with automation, as well as a new (old) trend of workplace performance reviews. Plus, I’ll share what I’ve been reading, listening, and thinking about.

Let’s get started!

Industry Highlights: iChina

Cartoon fans across the world celebrated this summer, as July 31 marked the birth of George Jetson, the patriarch of the fictional futuristic family many of us grew up with. With their flying cars and robotic maids, The Jetsons gave kids a glimpse into what automated tech the future might hold.

Flying cars might be a ways off—though this Japanese startup aims to have theirs ready for commercial sale by 2025—but based on recent trends, robots are definitely poised to replace more human jobs than ever.

According to the International Federation of Robotics, the density of industrial robots in factories around the world has nearly doubled in the last five years, averaging 126 automatons for every 10,000 workers. The US ranks 7th in density at 255 units per 10,000—double the global average, but not even close to South Korea, which touts a density of 932.

While these numbers clearly indicate a global trend toward automation, there’s one nation sprinting to the front of the line: China.

A recent Wall Street Journal article reported in the last three years, China has doubled down on its automation and now accounts for nearly half of the world’s industrial robots.

The motive behind this shift is both the rising cost of wages and the dwindling workforce. This year’s United Nations population report showed India is set to supplant China for most populous country in 2023, and as many Chinese citizens age out of work over the next few years, business leaders hope to use robots to fill the void.

“You can’t wait until your run out of people to start dealing with it,” Fathom Consulting deputy chief economist Andrew Harris told the WSJ.

For China, robots are a win-win because it will be able to keep production high and costs low, forcing many companies to rethink their plans to reshore manufacturing products. Now, it will come down to a moral dilemma. Will stepping away from China on ethical grounds be worth the price tag? Jane, get me off this crazy thing!

The Future of Work: Guess Who's Back?

Employees aren’t the only ones returning to the workplace. After several years of overlooking employee performance during the pandemic—and the overblown trend of “quiet quitting” sweeping offices—many companies are tightening performance standards and sending a message to workers: shape up or ship out.

A recent Wall Street Journal article revealed many companies became lax about employee performance during Covid. Many dropped formal evaluations and goal setting conversations in the interest of lowering stress and giving supervisors more time to put out fires.

But as I shared in The Supply Times last month, companies are taking notice of the growing disparity between labor costs and productivity. According to the Bureau of Labor Statistics, nonfarm workplace productivity was down 4.1% in Q2, while labor costs for that same period increased 10.2%.

“Growth and development is something companies were eager to get back to,” McKinsey partner Neel Gandhi told the WSJ. “It’s their day-to-day business way of ensuring folks are working on the right things and delivering on goals they’ve set for themselves.”

Many big companies are taking a scorched earth approach. Goldman Sachs, for example, told The New York Times it’s prepared to lay off hundreds of staffers as soon as this week following the reinstatement of performance review. Drastic? Maybe not, considering Goldman’s Q2 revenue fell 41% from a year ago, and its profits dropped by nearly half in the same period.

Needless to say, this makes workers anxious. Performance reviews aren’t often well-received by even the most productive employees, so a return to them has some concerned and frustrated—especially given the level of stress heaped onto many by pandemic working conditions and the impending economic uncertainty.

And some hiring experts warn that tying individual performance to layoffs is a mistake. “People will leave, but not the people who should leave,” former Google executive and workplace author Kim Scott told the WSJ. “You’re going to lose people who you would rather retain.”

The Supply Aside: What I’m Reading, Watching, Listening to, and Thinking About RE: Supply Chain, Work, and Beyond

📕 Read: Tesla is the envy of the automotive world right now, and its charismatic owner Elon Musk is downright fascinating. That’s why I think Tim Higgins’s book, Power Play: Tesla, Elon Musk, and the Bet of the Century is such a good read. I love Higgins when he writes for the Wall Street Journal, and this book falls in line with what makes his articles great: it’s crisp, well-reported, and compelling. It’s an interesting look at how innovators and their madman leader beat the odds and changed the landscape of the automotive industry.

👂 Listen:  Is workplace rudeness on the rise? I can get a little get off my lawn when I look at newer workplace trends, which is why this recent podcast episode from the Wall Street Journal’s As We Work podcast was so interesting to me. It talks about the changes in workplace etiquette—from the loosening of appropriate language to the wearing of shorts in the office. Their guest, psychology professor Tessa West, talks about how a perfect storm of disengagement and avoidance has led to what some consider a rise in rudeness.

💡 Think: Now that we’re starting to see the rise in robots that I mentioned above, I’m thinking about what that means for the future of work and human resources departments. Another Wall Street Journal article I read recently showed that by 2024, 80% of the G2000 companies will be using digital managers to hire, fire, and train workers. The snag developers are hitting, though, is that when humanoid robots deliver negative feedback, it makes employees feel like they’re being targeted. Maybe it would work better if every company had a Trump robot in its conference room to deliver his classic Apprentice line: “you’re fired.”

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