This week’s newsletter is brought to you by:

The Recruiting Radar is a weekly newsletter of leads for people in the business of recruiting. Subscribe now.

In today’s edition:

Chart of The Week: How the HRTech market is changing
Video: Does your company have an AI policy?
Article: The Price of Progress: How Automation Could Impact Your Paycheck (Part 2)
Comic: Reversing the Return to the Office Policy
ICYMI

Chart of the Week: How The HRTech Market is Changing

Source: How the #HRTech market is changing.

VIDEO – Does your company have an AI policy?

A survey by ResumeBuilder.com revealed that 91% of hiring business leaders are seeking workers with ChatGPT experience. In fact, 30% of companies are urgently looking for these skilled individuals to gain a competitive advantage. So, yay, ChatGPT! Right? No, not every company is on board with ChatGPT. Join me as I uncover the reasons why Samsung, Verizon, JPMorgan Chase, and others have banned ChatGPT (at least for the meanwhile). Plus, get a glimpse of a job that will surely become a trend in the very near future – Chief AI Officer. Don’t miss this eye-opening video!

This video brought to you by:

ClickUp – the future of work and collaboration. Get ClickUp for free— no credit card needed! #ai #candidateexperience #futureofwork

(Articles cited in this video and more, can be found here.)

Jobin.cloud

> Jobin is a LinkedIn automation tool. A combination ATS and CRM with ChatGPT integration. Click here to try it out now! (Totally worth a demo!!!)

The Price of Progress: How Automation Could Impact Your Paycheck (Part 2)

Increased automation can have both positive and negative effects on wages. Let’s put on the rose-colored glasses first.

ROBOTS AND ROSES

Automation often creates as many jobs as it destroys over time. A few modern examples…

Computerization and Office Automation: The rise of computers and office automation systems in the latter half of the 20th century brought about significant changes in administrative tasks. While it reduced the demand for certain clerical roles, it also created jobs in IT support, software development, data analysis, and digital marketing.

Retail Industry: Automation in the retail sector, such as barcode scanners, self-checkout systems, and inventory management software, has improved operational efficiency and reduced the need for manual tasks. However, it has also led to the growth of e-commerce, creating jobs in online retail, logistics, digital marketing, and customer service.

Renewable Energy: The transition to renewable energy sources, such as solar and wind power, has led to the growth of the clean energy industry. While it has impacted traditional fossil fuel sectors, it has also created jobs in renewable energy infrastructure development, manufacturing of clean energy technologies, and energy efficiency consulting.

Logistics and Warehousing: Automation technologies, including conveyor systems, robotics, and autonomous vehicles, have revolutionized logistics and warehousing operations. While it has reduced the need for manual labor in certain tasks, it has also created jobs in managing and maintaining these automated systems, supply chain optimization, and last-mile delivery services.

Advanced Manufacturing: The emergence of advanced manufacturing technologies, such as 3D printing, computer numerical control (CNC) machines, and additive manufacturing, has transformed the manufacturing landscape. While it has reduced the need for some manual labor, it has also created jobs in designing and operating these technologies, materials development, and supply chain management.

Workers who can work with machines are more productive than those without them. For instance…

Collaborative Robots (Cobots): Cobots are designed to work alongside human workers, assisting them with various tasks. These robots are equipped with advanced sensors and programming that enable safe interaction with humans. In manufacturing settings, cobots can handle repetitive or physically demanding tasks, such as lifting heavy objects or performing precise assembly tasks. By taking on these tasks, cobots not only reduce the risk of injuries to human workers but also increase overall productivity by allowing workers to focus on more complex and strategic activities.

Augmented Reality (AR) in Maintenance and Repair: AR technology has found applications in various industries, including maintenance and repair. With AR, workers can wear smart glasses or use mobile devices to overlay virtual information onto the physical environment. In the context of maintenance and repair tasks, AR can provide real-time guidance, instructions, and visual cues to workers, helping them identify and resolve issues more efficiently. This technology minimizes downtime, reduces errors, and improves worker productivity by providing them with instant access to information and expertise.

Wearable Exoskeletons: Exoskeleton technology involves the use of wearable devices that provide physical support and assistance to workers. These devices are particularly beneficial in physically demanding industries such as construction, manufacturing, and logistics. Exoskeletons can reduce fatigue and strain on workers’ bodies by augmenting their strength and endurance. By providing additional support during tasks such as lifting heavy objects or maintaining awkward postures, exoskeletons enable workers to perform their duties more effectively and safely. This, in turn, increases productivity and reduces the risk of work-related injuries.

And due to technical advances, the costs and prices of goods and services decreases over time. Take this into account…

Mass Production and Assembly Line Techniques: The implementation of mass production and assembly line techniques, pioneered by Henry Ford in the early 20th century, revolutionized manufacturing processes. By incorporating technologies such as conveyor belts, specialized machinery, and standardized parts, Ford was able to significantly reduce the time and cost required to produce automobiles. This led to a substantial decrease in the price of cars, making them more affordable and accessible to the general population.

E-commerce and Online Retail: The advent of e-commerce and online retail platforms has transformed the way goods are bought and sold. Online platforms eliminate the need for physical storefronts, reducing overhead costs associated with rent, utilities, and staffing. Additionally, streamlined supply chain management, automated inventory systems, and optimized logistics have significantly improved operational efficiency. These advancements in technology have enabled retailers to offer products at lower prices compared to traditional brick-and-mortar stores, benefiting consumers with reduced costs and increased affordability.

Digitalization of Services: The digitalization of various services, such as banking, telecommunications, entertainment, and education, has led to cost reductions and price decreases. Digital platforms and technologies have automated processes, reduced paperwork, and eliminated the need for physical infrastructure. For instance, online banking allows customers to perform transactions and access services without visiting a physical branch, leading to cost savings for both the bank and the consumer. Similarly, digital entertainment platforms have eliminated the need for physical media production and distribution, resulting in lower costs for consumers and increased accessibility to a wide range of content.

And of course, lower costs incentivize more spending and consequently, the creation of new jobs. Three factors play into this.

Increased Disposable Income: When the prices of goods and services decrease due to process improvements and technological advancements, consumers have more disposable income available. With the same amount of money, consumers can purchase a larger quantity of goods or explore new products and services they previously couldn’t afford. This increased purchasing power leads to higher consumer spending, stimulating demand and generating a positive economic ripple effect.

Expansion of Industries and Market Opportunities: When consumers have more discretionary income and are willing to spend, businesses experience higher demand for their products and services. This increased demand often prompts businesses to expand their operations, invest in research and development, and explore new market opportunities. As a result, businesses may need to hire additional employees to meet the increased production or service demands, leading to job creation in various sectors of the economy.

Growth of Supporting Industries: Increased consumer spending can also create job opportunities in supporting industries. For instance, when consumer demand for products rises, there is a need for logistics and transportation services to move goods from manufacturers to retailers or directly to consumers. This leads to job creation in transportation, warehousing, and delivery services. Additionally, increased consumer spending on services, such as dining out or entertainment, can create employment opportunities in the hospitality and leisure sectors.

LABOR MARKET INEQUALITY IS REAL

But its not entirely a rosy picture. As the positive changes gradually take hold over time, there is a more immediate consequence of labor market inequality. According to Forbes [June 18, 2021] …

According to a new academic research study, automation technology has been the primary driver in U.S. income inequality over the past 40 years. The report, published by the National Bureau of Economic Research, claims that 50% to 70% of changes in U.S. wages, since 1980, can be attributed to wage declines among blue-collar workers who were replaced or degraded by automation.

Artificial intelligence, robotics and new sophisticated technologies have caused a wide chasm in wealth and income inequality. It looks like this issue will accelerate. For now, college-educated, white-collar professionals have largely been spared the fate of degreeless workers. People with a postgraduate degree saw their salaries rise, while “low-education workers declined significantly.” According to the study, “The real earnings of men without a high-school degree are now 15% lower than they were in 1980.”

Here is something else to think about, along these lines. Back in 2020, there was an academic paper that set people’s hair on fire – Robots and Jobs: Evidence from U.S. Labor Markets. It was written by MIT professor Daron Acemoglu. It was this finding in particular that caused the alarm.

The researchers found that for every robot added per 1,000 workers in the U.S., wages decline by 0.42% and the employment-to-population ratio goes down by 0.2 percentage points — to date, this means the loss of about 400,000 jobs. The impact is more sizable within the areas where robots are deployed: adding one more robot in a commuting zone (geographic areas used for economic analysis) reduces employment by six workers in that area.

AUTOMATION IS A DOUBLE-EDGED SWORD

Automation depressing wages may sound like an attractive bargain to companies focused solely on the bottomline but, that can backfire – spectacularly. Take for example, the burger-flipping robot – “Flippy.” In 2018, Flippy was shut down after one day of service because it could not keep up with customer orders. What did the restaurant do in response? Ask human cooks to step in. IBM spent $62 million to develop an AI system to aid in the battle against cancer, but the system failed and could have killed patients. Amazon wanted to automate recruitment and ended up ostracizing women. Amazon also tried innovating with facial recognition. Unfortunately, it failed when their AI falsely matched 28 members of Congress as criminals. (I’m going to resist the urge to make a political joke here.) A real estate tycoon from Hongkong bought an AI system to manage part of his fortune and increase his holdings. Unfortunately, the robot ended up losing as much as $20 million USD a day. To get back a part of his money, the tycoon filed a $23 million lawsuit against the company. The suit is the first known case of a court action filed over automated investment losses. In 2015, the first Henn-na Hotel in Japan opened with an all-robot staff for front-desk, cleaning, portering, and in-room assistance. However, the robots faced numerous issues such as frequent breakdowns, inadequate guest assistance, and misinterpreting snoring as wake commands, leading to customer complaints. After years of difficulties, the hotel chain ultimately replaced the robots with human workers, considering them unreliable, expensive, and annoying.

WHAT RECRUITERS SHOULD BE DOING NOW

All of this to say, in the long-term, new technologies are a benefit that often create more jobs that they destroy. It’s the short-term that should concern you. Some companies will move too quickly in the hopes of saving money but end up with self-inflicted wounds to their bottomline and (possibly) their employer brand. If history repeats itself, automation will have a definite impact on wages in general and I predict on the recruitment industry specifically as new AI tools proliferate. My suggestion is not to fear the future but prepare for it. As such, here are 5 things I suggest every recruiter should be doing now.

Embrace Technology: Rather than seeing AI tools as a threat, recruiters can view them as tools to enhance their capabilities. By embracing technology, recruiters can stay updated on the latest AI advancements and explore how these tools can complement their work. They can focus on leveraging AI to automate administrative tasks, enhance candidate screening processes, and gather data-driven insights to make informed decisions. A recruiter will not lose their job to AI. However, they will lose it to another recruiter adept in AI.
Develop Specialized Skills: Recruiters can differentiate themselves by developing specialized skills that go beyond the capabilities of AI tools. This can include expertise in areas such as relationship building, understanding organizational culture, assessing soft skills, and conducting effective interviews. Recruiters can focus on building strong interpersonal skills, emotional intelligence, and industry knowledge, which are difficult to replicate through automation.
Focus on Human Connections: Building meaningful relationships with candidates and clients is an area where human recruiters excel. By prioritizing personal connections, recruiters can provide personalized guidance, understand unique candidate needs, and offer a human touch throughout the hiring process. Maintaining strong relationships with clients and candidates can help recruiters retain their value and establish trust that goes beyond the capabilities of AI tools.
Offer Value-Added Services: Recruiters can go beyond basic candidate sourcing and screening by offering value-added services that require human judgment and expertise. This can include providing career advice, conducting in-depth candidate assessments, offering guidance on market trends, and providing insights on talent acquisition strategies. By offering high-quality, personalized services, recruiters can demonstrate their unique value proposition.
Continuous Learning and Adaptation: The recruitment landscape is constantly evolving, and staying updated on industry trends, technology advancements, and changing job market dynamics is crucial. Recruiters should invest in continuous learning, attend relevant industry conferences, participate in training programs, and stay connected with professional networks to adapt to the evolving recruitment landscape.

In conclusion, while automation has the potential to impact wages and the recruitment industry, it is important to approach it with a balanced perspective. Automation brings both positive and negative effects on employment and income inequality. While it may lead to job displacement in the short term, history has shown that it often creates new job opportunities in the long term. Companies should be cautious not to rush into automation without considering the potential risks and challenges that can arise. Recruiters can protect their livelihoods by embracing technology, developing specialized skills, prioritizing human connections, offering value-added services, and committing to continuous learning and adaptation. By adapting to the changing landscape and leveraging AI tools as enhancements rather than threats, recruiters can ensure their continued relevance and value in the recruitment industry. But that’s just one man’s opinion. What’s yours? Reply back and let me know. I want to hear from you.

Reversing the Return to the Office Policy

ICYMI

Do you know Scott McKinnon?

“Experienced sales leader, for more than 20 years, I have helped Human Capital Management companies prosper and grow by mentoring, coaching, and implementing strategic initiatives which bring structure to the sales process, resulting in increased sales. My passion is helping people and companies grow beyond their current capabilities.”

Connect with Scott and network with him today!

…

Until next time, see you in the funny papers.

Jim Stroud

P.S. May I be of assistance?

Follow me on Social Media: