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Will a post-Brexit economy swap workers for robots?


There are not many economic fields in which Britain truly leads the world.

Financial innovation, perhaps. Deep sea oil mining maybe. Formula One engineering, probably.
But there is one sector where the UK is an indisputable leader: sandwiches. This country is more efficient and more successful at producing high quality takeaway sandwiches than any other economy in the world.
Britain’s sandwich industry has been at the forefront of innovation in the field, developing new breeds of vegetables – tomatoes and lettuce – that make for a fresher, longer-lasting sandwich.
So if there was some way to build a robot to make sandwiches, you might have thought Britain would have developed it already.

Image: Workers from the EU are needed in agriculture and other industries
But if you take a trip to one of this country’s major sandwich makers, a place like Raynor’s, for instance, you will instead find a hive of human activity.
While there is a certain amount of automated activities along the production line – the slicer for the bread, the packaging machines – the majority of work filling the sandwiches is still done by hand.
That means Raynor’s is highly reliant on low cost, low skill labour, which these days mostly means Eastern European workers. But in the past few months, they’ve noticed the flows of workers have slowed.
This poses something of a problem. In the long run, given Britain has near full employment, the solution – if immigration is indeed to fall as the Government intends – is to automate more of the production line.
But according to managing director Matt Raynor, the technology is still some way off. You can’t get a robot to pick out the appropriate leaf of lettuce for the appropriate sandwich – and certainly not as quickly as a human could do the job.
The big question is whether Brexit will push UK firms in the right direction – to try to develop that robot, or find an alternative.

Video: Construction industry faces immigration ‘cliff edge’

Indeed, for all the doom and gloom about the decision to leave the EU, this shock therapy for productivity is one of the areas where economists might agree Brexit provides some opportunities.
Faced with a tighter labour market and fewer workers, might UK firms be forced to innovate and invest in automation? Given the UK currently has the developed world’s lowest take-up of robots, perhaps this is for the best?

:: Robots could replace more jobs as living wage rises
It’s a similar story in the agriculture sector. Alison Capper of Stocks Farm in Worcestershire farms apples and hops, but while she has managed to automate some processes, for instance cutting one tractor by introducing a self-driving platform for fruit pickers, there is no off-the-shelf machine that could pluck an apple off the tree.
Perhaps such a thing might exist in five or 10 years, but might that be too late?
And that raises a big question. The Government is determined to push through Brexit as fast as possible, with a time-limited implementation period.
But at present, most businesses say they could not instantly adapt to a sudden fall in migration. At the very least, they say, if the plan is to cut EU migration, then they will need more seasonal labour from outside the EU.

Video: Are machines taking our jobs?

But that would run headlong into the Government’s other aim: to get net migration down into five figures. In other words, were this all to happen in five or 10 years’ time, the two aims of business and government could dovetail perfectly.
Immigration could come down and the robots would be there to take up the slack. UK productivity could finally rebound from the low rates seen recently.
But if immigration were to fall dramatically overnight, businesses wouldn’t have the processes available to adapt. It would be deeply economically destructive.
It underlines why so many companies are so keen on a transition period with the continuation of free movement for some time longer.

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It’s not so much that they are all ardent remainers. It is that the country is not yet ready to shut its doors.
But in a few years’ time we might hit the sweet spot where the technology is there, and lower migration might actually be a good thing for UK plc.

Source: Sky

About Business Ideas UK

My name is Joel Bissitt. I have been an entrepreneur for 24 years and have run many small businesses across various sectors. For the last 10 years I have worked mainly within online media, franchising and small business start-ups.

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