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The UK economy is undercapitalised. It has 71 robots for every 10,000 employees in manufacturing, Germany has 300- The net employment impact of automation will likely be neutral
- Taxing robots would suppress productivity growth, wages, & encourage economic activity to locate elsewhere
- Worries over the impact of automation on jobs are increasingly widespread, with the Labour Party floating measures that would impede mechanisation.
- If anything, the UK’s problem is having too few robots, not too many. There are only 71 for every 10,000 employees in manufacturing, compared to more than 300 in Germany.
- It is unlikely that net employment will fall as a result of mechanisation – and the UK is at lower risk than other developed nations.
- Taxing robots would not protect jobs. On the contrary, impeding mechanisation would further suppress productivity growth, depress wage growth and encourage economic activity to locate elsewhere – thereby reducing the tax base to pay for public services.
- Calls for a Universal Basic Income are premature. It would be costly, distort the labour market and, in any case, income inequality has been falling.
- Nevertheless, the potential for automation to lead to growing income inequality is a concern. The best way to counter this, however, is not by nationalising the robots, but by reforming skills and training.
