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Unskilled labour

Jim Pinto, automation industry analyst, grapples with the global skills shortage and the strange phenomenon of ‘mismatched skills’ in business.

The skills shortage encompasses more than meets the eye. Factions of our skilled labour are being taken offshore while certain elements have been poisoned from within.

This is mirrored with changing trends in the knowledge powerhouses of the world, with industrialised nations now competing with developing countries.

Automation skills enigma

The global skills shortage mirrors the continuing decline of interest in automation jobs. Few consider a factory job an exciting career; most just drift into it by happenstance.

The speed of change brings with it a mismatch of skills. Experienced people know about all the old things like instruments, controllers, good wiring practices and safety procedures. But they are relatively inexpert with new digital skills like networking and communications, which comes through younger, usually lower-paid ‘technicians’. In the final analysis, the problem is pay. Many bright young engineers insist that in industry at large, there isn’t any shortage of engineering skills – just a severe lack of rewards.

To circumvent the problem of skills shortages, or perhaps to reduce costs, many end-user companies simply contract whole projects to large automation suppliers or systems integrators, or even go offshore. But that merely passes the problems along, and the company loses control of vital engineering skills.

And therein lies the rub. The automation careers that are generally not held in high regards in the United States and Australia are greatly respected and even coveted in developing countries like India, South America and the far east. Today’s global market offers easy availability of foreign engineers, all with skills that match the need and willingness to fill the gaps.

Many are lulled into thinking that it’s only the low-skilled jobs that are going offshore. That’s simply not true. More and more high-value design and systems-engineering positions are being filled offshore, leaving little but systems integration and manual-labour to be done locally.

Global automation perspectives

The assumption has been that the United States, Australia and other industrialised nations will keep leading in knowledge intensive industries, while underdeveloped and developing countries focus on lower skills and lower labour costs. That’s changed. Many countries around the world now compete.

Through inexpensive, universal communications technology, knowledge work is migrating worldwide to the highest-quality, lowest-cost providers. Productivity has become a fierce, head-to-head competition between regions and nations. Whoever makes things better-faster-cheaper wins. The prize is wealth – a higher standard of living.

The human factor – ‘asymmetric motivation’ – is forcing change. In advanced regions such as North America and Europe, salaries are high and the motivation to work long hours is limited to those few who have natural drive. By contrast, in developing countries, the push for upward mobility is intense, which results in huge productivity differences.

Innovation will be a key driver for growth. And that may come from virtually anywhere – not just the advanced first-world countries.

Within the next two decades, India will overtake China to become the world’s most populous country. Both countries’ middle-class populations are advancing quickly to produce and consume a vast amount of products, services and energy. Everyone’s growth plans must take into account the markets in these and other major, advancing countries.

In a fragile financial environment, look for new automation leaders to emerge through acquisition, perhaps even from China or India. Look for BIG changes.

Jim Pinto

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