UW professor discusses automation and the post-COVID economy in new study


Professor Joel Blit says Canada’s economy could be stronger post-pandemic if the right policies are in place to support more automation

One UW professor says more automation can make Canada’s economy stronger and more productive after COVID-19, if the right policies are in place to manage it.

Joel Blit, a professor from the University of Waterloo’s Department of Economics, studied data from Labour Force Surveys (LFS) to determine which industries would undergo the most automation and allocation of resources post-pandemic.

Looking at health-related incentives to automate within different sectors, Blit says the retail industry will undergo the largest economic change with automation, followed by manufacturing, wholesale, construction and transportation.

“In every recession since the beginning of the information and communications technology (ICT) revolution, the Canadian economy has undergone significant technological automation and resource reallocation,” said Blit in a release, “This COVID-19-induced recession will be no different, and in fact, will trigger an even bigger economic transformation due to the added health-related incentives to automate.”

“With the right policies in place, we can ensure that we emerge from the crisis with a stronger and more productive economy that benefits all Canadians.”

Employment trends from 1987 to 2020 showed a large decline in ‘routine’ jobs, like office support and manufacturer assembly workers, after the past three recessions. However, within the same period, Blit says there was a rise in ‘non-routine’ jobs, such as management and healthcare professionals.

As the economy continues to recover, Blit says Canada should consider making transformational change during this time of low costs and labour market disruption.

“The wave of solidarity and increased belief in the important role of government present an opening to reimagine our social safety net and create the institutions and programs that will ensure that all Canadians, current and future, share in the benefits of technology.” said Blit.

He adds that current policies, like the Canada Emergency Wage Subsidy, are stifling economic transformation and could be replaced with policies that support workers through the transition to increase automation.

“For example, we should help retrain workers and consider transforming the current Canada Emergency Response Benefit program into a permanent guaranteed basic income.” said Blit.

 

 

 



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