Renting Robot Workers Can Cost Roughly Half as Much as Hiring Humans — What Does This Mean for US Workforce?

At the Factory: Automation Engineer Uses Laptop for Programming Robotic Arm.
gorodenkoff / Getty Images/iStockphoto

Robot workers appear to be taking part in their own version of the gig economy, with some being rented out to short-handed companies for nearly half the cost of a human worker — which does not bode well for people who want to compete for jobs.

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One such robot was leased by Polar Manufacturing in Chicago to lift pieces of metal onto a press. It costs the equivalent of $8 an hour vs. $15 an hour for a human worker, according to a recent article on Wired.

Polar rented the robot from Formic, a provider of leased automated systems, because it needed to meet rising demand amid a shortage of workers. Because the robot was able to take care of a repetitive assembly line job, human workers could be deployed elsewhere to increase production.

“Smaller companies sometimes suffer because they can’t spend the capital to invest in new technology,” Jose Figueroa​, Polar’s production line manager, told Wired. “We’re just struggling to get by with the minimum wage increase.

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Since Polar leased the robot worker, it didn’t have to pay $100,000 to buy it. The company also saved money by not having to get the robot programmed. It’s working so well that Figueroa wants to see 25 robots on the line within five years. But that doesn’t mean any of Polar’s 70 employees will be let go, Wired noted. However, it might mean the company won’t be hiring any additional employees.

That could be a trend as more companies — especially small businesses — turn to robots and other automated systems to handle the workload. It’s an especially attractive option in the current labor market, where a record number of people have been leaving jobs as part of the Great Resignation.

An October report from the International Federation of Robotics projected that global robot installations were expected to grow by 13% to 435,000 units in 2021, breaking the previous record achieved in 2018. Installations in North America were expected to increase 17% to nearly 43,000 units.

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That might be good news for robot manufacturers and sellers, but not so good news for human workers. In fact, many different sectors of the economy are gravitating toward robot help.

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A growing number of restaurants are using robots to do everything from work the drive-thru to process credit cards, the Seattle Times reported this month. And as GOBankingRates previously reported, even trucking firms are experimenting with driverless, robot-controlled big rigs.

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About the Author

Vance Cariaga is a London-based writer, editor and journalist who previously held staff positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal and Business North Carolina magazine. He holds a B.A. in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting earned awards from the North Carolina Press Association, the Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A native of North Carolina who also writes fiction, Vance’s short story, “Saint Christopher,” placed second in the 2019 Writer’s Digest Short Short Story Competition. Two of his short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. His debut novel, Voodoo Hideaway, was published in 2021 by Atmosphere Press.

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