Deloitte: Automation transforming UK industries has been saved
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Deloitte: Automation transforming UK industries
22 January 2016
- Wholesale & retail and transport & storage sectors have highest numbers of jobs with a high chance of automation
- Health, professional & technical and education have highest numbers of jobs with a low chance
- Effects of technology and automation clear in job and wage shifts since 2001
The UK wholesale & retail sector has the greatest number of jobs with a high chance of automation in the next ten to twenty years according to research by Deloitte, the business advisory firm.
Deloitte’s analysis is based on the latest Office for National Statistics figures, combined with the firm’s 2014 work with Oxford University, which found that a total of 35% of today’s UK jobs have a high chance of being automated. Deloitte has now updated the work to study the impact of automation on jobs by major industry group.
High and low risk sectors
Looking at the sectors of the UK economy with the greatest numbers of jobs with a high chance of automation, Deloitte finds that 2,168,000 jobs in the wholesale & retail sector (59% of the total current workforce) have a high chance of being automated in the next two decades. This is followed by transport & storage - 1,524,000 jobs (74%) - and human health & social work - 1,351,000 jobs (28%).
However, the human health & social work sector also has the largest number of jobs with a low likelihood of automation with 2,249,000 jobs (46% of the workforce) in the low chance category, followed by professional, scientific & technical roles - 2,215,000 jobs (58%) and education - 1,927,000 jobs (66%).
Largest job growth and job loss
Deloitte’s industry-by-industry analysis suggests that the impact of automation is already being felt in sectors where a high proportion of jobs have a high chance of being automated.
The three sectors with the largest loss of jobs between 2001 and 2015 were:
- Manufacturing – 720,000 net jobs lost, 650,000 (90%) of which had a high chance of automation.
- Wholesale & retail – Overall loss of 338,000 jobs, 239,000 (71%) of which had a high chance of automation.
- Professional, scientific & technical roles – Overall loss of 269,000 jobs which had a high chance of automation. However, the sector also saw growth of jobs with a low chance.
The three sectors with the highest job growth were:
- Health & social work – 1,100,000 jobs created, 660,000 (60%) of which have a low chance of automation.
- Education – 746,000 jobs created, 461,000 (62%) of which have a low chance of automation.
- Professional, scientific & technical roles – Though seeing one of the largest losses of jobs at high risk, 650,000 jobs were created, 575,000 (88%) of which have a low chance of automation.
The changing distribution of wages
The changing picture of the UK workforce is being matched in the distribution of wages.
Between 2001 and 2015 the sectors with the three largest increases in overall wage contribution were health & social work, with £27.36 billion added in wages, professional scientific & technical roles, £23.91 billion added, and financial & insurance services, £18.53 billion added.
The total wage contribution of the manufacturing sector decreased by £16.52 billion, followed by retail, with a decrease of £4.14 billion, and transportation & storage with a decrease of £2.23 billion.
Angus Knowles-Cutler, Vice Chairman of Deloitte, said:
“Advances in technology mean that an ever greater number of tasks in the workplace can be automated. Computers and robots are replacing human labour where it is easier and cheaper for them to be used. Our study looks at what technology is likely to be capable of, rather than the ease or relative cost of automation. As the cost of technology reduces or the price of human labour increases, the pace of automation of jobs is likely to accelerate.
“The pattern of job automation by UK industry is quite diverse. Sectors where many tasks are manual, clerical, administrative and repetitive are much more vulnerable than those where creative, technical or strong interpersonal skills are required.
“The recent history of the UK economy gives us reason for optimism. Technology has created far more jobs than it has destroyed since 2001, with new roles tending to pay better than those that have been replaced and be safer from the risk of future automation. Also, the effective use of technology will be critical in keeping the country successful and productive in a competitive world.
“What will be key is for business, public sector, government and educators to understand fully both the threats and opportunities presented by technology. There is a real need to work together to ensure that both young people, and the current UK workforce, are equipped with the education and skills needed in a new world of work.”
End
Notes to editors
Data
Jobs with a high, low and medium chance of automation across each industry group are as follows, these figures are based on ONS figures and Deloitte analysis.
| Total employment in 2015 | ||||
|---|---|---|---|---|
| Industry sectors | Total jobs by sector | High risk | Medium risk | Low risk |
| Arts, entertainment and recreation | 724,000 | 202,000 | 159,000 | 363,000 |
| Agriculture, forestry and fishing | 327,000 | 112,000 | 157,000 | 58,000 |
| Accommodation and food services | 1,659,000 | 1,103,000 | 250,000 | 306,000 |
| Administrative and support Service activities | 2,052,000 | 528,000 | 804,000 | 720,000 |
| Education | 2,919,000 | 247,000 | 745,000 | 1,927,000 |
| Financial and insurance activities | 1,368,000 | 476,000 | 226,000 | 666,000 |
| Human health and social work activities | 4,894,000 | 1,351,000 | 1,294,000 | 2,249,000 |
| Information and communication | 1,403,000 | 119,000 | ** | 1,284,000 |
| Mining and quarrying | 89,000 | 32,000 | 40,000 | 17,000 |
| Manufacturing | 1,733,000 | 974,000 | 357,000 | 402,000 |
| Public administration and defence, compulsory security services | 1,455,000 | 287,000 | 199,000 | 969,000 |
| Professional, scientific and technical activities | 3,796,000 | 1,021,000 | 560,000 | 2,215,000 |
| Real estate and construction | 2,607,000 | 882,000 | 406,000 | 1,319,000 |
| Transportation and storage | 2,056,000 | 1,524,000 | 371,000 | 161,000 |
| Wholesale and retail; repair of motor vehicles | 3,656,000 | 2,168,000 | 662,000 | 826,000 |
| Total UK jobs | 30,738,000 | 11,026,000 | 6,230,000 | 13,482,000 |
Additional data referenced above is available upon request.
Previous research
In November 2014, Deloitte published Agiletown – The relentless march of technology and London’s response, which forecasted 35% of UK jobs have a high chance of being automated in the next 20 years.
In September 2015 by From brawn to brains - The impact of technology on jobs in the UK, looking at automation of jobs by region, the number of jobs lost and created by technology since 2001 and their economic contribution.
In August 2015, Deloitte chief economist Ian Stewart published Technology and people – The great job creating machine looking at the impact of technology on jobs in the UK back to 1871.
About Deloitte
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.
Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.
The information contained in this press release is correct at the time of going to press.
Member of Deloitte Touche Tohmatsu Limited.
Mark Smith
Deloitte LLP
+44 (0) 20 7007 7082
+44 (0) 75 9004 1301
marksmith@deloitte.co.uk
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