De Paul University Automation on Firms Analysis

Description

Please prepare a roughly 1-page analysis of what the impact of automation might be for profit maximizing firms.

I present you with a couple of different articles that offer very differently opinions on this subject. The first, which references a study by Bain, states that automation may replace as many as 2.5 million workers per year. http://www.wbur.org/hereandnow/2018/04/24/automation-jobs-middle-class

The second cites an NPR survey in which 94% of US workers across all industries say it’s unlikely they will lose jobs to automation. https://www.npr.org/2018/01/25/579160550/don-t-think-a-robot-could-do-this-warehouse-workers-aren-t-worried-for-their-job (Links to an external site.)

Why would firms switch to more capital (automation) rather than labor? Do you think it will move very quickly and/or accelerate what might happen in the long term?

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