Robotisation in Singapore Could Spur 20% GDP Growth
Robotisation in Singapore is gaining traction, as the country transitions into a knowledge-based, innovative, and smart nation. With an average of 488 robot workers per 10,000 human employees, the island nation has risen to become the second most automated nation in the world, behind South Korea.
Robotisation in Singapore
The number of robots used in various sectors of the economy has increased rapidly since the 2008 financial crisis, as the country sought to become highly competitive in the global scene. Robots deployed in various sectors increased by an average of 20% between 2010 and 2016. A good chunk of the robots have gone a long way in fuelling the country’s manufacturing sector, which is now built upon robotic innovation.
The government is actively spearheading the automation drive as it seeks to create a smart nation. Introduction of measures to enhance innovation and promote research in the field of robotics has also come into play. In addition, the government has pumped millions of dollars into the economy in a bid to accelerate the development of robots to enhance production efficiency in various sectors.
Through the National Robotics Program, the government has invested close to $450 million to accelerate the development of robotics technologies. The incentive program seeks to spur the development of robots to enhance operations and efficiency in health care, construction as well as manufacturing and logistics sectors.
A charge into robotics does not come as a surprise. Singapore has had to turn to emerging technologies in a bid to solve looming and underlying problems. Declining birth rates compounded by an aging population has forced the country to rely on the foreign workforce for many years. However, with the use of technology in the form of robots, the country is on its way to becoming self-sufficient.
The government has had to increase investments on automation after facing a number of challenges associated with outsourcing of labor from outside. While foreign workers have helped fill the labor gap, they have also given rise to a number of issues related to competition for housing as well as transportation. Locals have also made clear the discontent over increased competition for jobs. Conversely, the government has had to rethink its foreign labor policy.
The admission that non-human workers present a way of overcoming population and labor woes has continued to fuel increased focus on robots. For that reason, a number of industrial robots have cropped up, taking up most of the tasks in the manufacturing sector. Technology adoption is thus gaining traction as firms move to take advantage of the efficiency brought about, which also translates to reduced wastage and increased productivity.
Robotisation Economic Impact
A majority of robots in Singapore are installed in the electrical industry, which accounts for about 60% of the country’s total industrial production. The sector should continue to experience an exponential rise in robotic applications, given the rising demand for electronic products both locally and internationally.
Robotics installations will mostly go towards enhancing the manufacturing of semiconductors and computer peripherals. The country is seeking to become a key player in the production of chips as well as displays among other products used in the production of electric devices.
Increased robot adoption should spur economic development, given the enhanced efficiency that Singapore stands to enjoy. According to a recent study by Oxford Economics, robot adoption could trigger a 20% growth in the country’s Gross Domestic Product. For a 20% growth in GDP to happen, the robot stock in the country should grow by 44% above the baseline projection.
Automation through robotics should also relive workers of strenuous repetitive tasks, consequently freeing them up to focus on performing higher-value functions. For instance, some hospitals in the country are using robots alongside human workers to pick, pack, and deliver medicines.
However, Robotisation in Singapore could pose significant challenges amidst the synergies the country stands to enjoy. While greater automation is likely to deliver productivity gains, it is also likely to take a toll on the labor industry. Robotisation could go a long way in displacing poor population, consequently widening the gap between skilled and higher-skilled populations.
Unlike other countries, Singapore might be able to shrug off some of the effects posed by high levels of automation. The fact that the country’s workforce at 60% in the manufacturing sector is mostly made up of highly skilled personnel should help offset some of the effects that might crop up.
In addition, the Singapore labor market is mostly made up of non-permanent foreign workforce. About 70% of the 1.4 million foreign workers hold a work permit. That said, the government could have its work cut out should it come under pressure to tighten worker quotas. If that was to happen, robots could help fill the void left behind by the foreign workers
Similarly, Singaporean workers are also at risk of feeling the pressure of increased automation. While most of them work in service roles, technology is slowly eating into their jobs. Robotisation in Singapore pose significant risks to resident workers in low-to medium-skilled service sector jobs.
The emergence of artificial intelligence bots, for instance, is increasingly taking over many customer service jobs, among others. People working in small and midsize enterprises, as well as retail and food sectors, face the biggest risk of job loss. For the workers to cling on to their jobs, they might have to learn new skills to stay competitive in the more automated service economy.
Robotisation is a new trend that should continue to gain traction in Singapore. Faced with an ageing population and lower birth rates, the country has no option but to turn to technology as a way of staying competitive on the international scene.
Contrary to perception, Robotisation in Singapore has not led to job loss or disrupted a number of industries. Instead, technology has led to the creation of new jobs in addition to accelerating the production of quality goods and services. Singapore understands that robotics is at the heart of driving development expected to enhance economic growth.