Automation: A Solution to US Labor Shortages “`

Even before President-elect Donald Trump announced his plans for mass deportations, impacting industries reliant on immigrant labor, the U.S. faced a labor shortage. The retirement of Baby Boomers and insufficient replacements created economic challenges, potentially leading to higher wages due to decreased workforce availability.

Many businesses are adopting automation—a solution previously viewed with apprehension by some employees—to navigate this economic landscape.

“The U.S. simply lacks a sufficient workforce,” stated Aamir Paul, president of Schneider Electric’s North American operations, during a December 3 TIME100 talk on AI, automation, and sustainable infrastructure (sponsored by Schneider Electric). “To maintain GDP growth and the U.S.’s global economic standing, we must find innovative ways to utilize our workforce.”

Schneider Electric and other major U.S. companies are leveraging AI and automation to optimize workforce deployment, identifying tasks suitable for automation while also retraining employees to collaborate with machines. Amazon, for example, opened a Shreveport, Louisiana warehouse featuring tenfold the robotics and AI of previous facilities, resulting in a 30% increase in skilled jobs. Schneider Electric modernized a 64-year-old Lexington, Kentucky facility using AI to improve energy and water efficiency—a project completed entirely by existing employees.

Initial concerns among U.S. workers about job displacement due to AI and automation are evolving. As companies provide retraining and facilitate collaboration between humans and machines, the perception of automation is shifting, according to Paul: “It’s transforming from a feared prospect to something exciting, as employees recognize their continued value in this new environment.”

Historically, fears about technological job displacement have often proved unfounded. While technology may replace some roles, it also generates new and improved opportunities. The introduction of ATMs, for instance, initially alarmed bank tellers, yet increased bank accessibility ultimately led to a greater demand for and an increase in bank tellers.

“We’re not ready to relinquish control to machines,” noted Daniela Rus, director of MIT’s Computer Science and Artificial Intelligence Laboratory, a fellow panelist. “But with machines as partners, we can expand our capabilities, enhance our strength, and improve precision.”

Some believe the U.S.’s advancements in automation and AI have contributed to a faster economic recovery compared to Europe and Asia. The U.S. supply chain demonstrated greater resilience, leading to a more stable economy. “Our post-COVID recovery and economic growth relative to other global markets clearly highlight the impact of our automation investments,” stated panelist Sriram Krishnasamy, FedEx’s chief transformation officer.

The Euro Area’s unemployment rate stood at 6.3% in October, while the U.S. currently reports 4.1%. The U.S. has more employed individuals than pre-pandemic levels, even within the manufacturing sector, which is simultaneously embracing automation and its workforce.

Furthermore, Rus cited numerous studies indicating that individuals collaborating with AI and automation achieve greater productivity across various tasks, including coding, inventory analysis, and document editing.

“We are not creating something to compete with us,” she clarified. “We are building something for us.”

TIME100 Talks: The New Industrial Renaissance was presented by Schneider Electric.