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Robots to take half a million UK retail jobs

Robots to take half a million UK retail jobs

UK retail is set to lose over half a million[1] jobs to robots – as IT leaders[2] in the sector expect up to 1 in 5 jobs to be replaced by AI/automation within five years, reveals the 2019 Harvey Nash/KPMG CIO Survey, the largest technology leadership survey in the world.

The move towards automating the retail sector is being driven from the top, with almost half (44%) of IT leaders reporting that using automation to improve efficiencies is one of the big issues that their board is looking for IT to address. 

These findings are published shortly after the Office for National Statistics (ONS) estimated that two-thirds (135,000) cashier jobs in UK retail are at high risk of being automated, and the John Lewis Partnership announced that it is one of the companies behind an open framework which will help companies understand the relationship between humans and robots, after it has trialled the use of robots to harvest produce from its farms for Waitrose stores.

The data, which forms part of the world’s largest technology leadership survey, analysing responses from over 3,600 organisations with a combined technology spend of over US$250bn, also reveals today (24th October 2019) two thirds (67%) of IT Leaders in UK retail believe new jobs will compensate for job losses to AI/automation. This combined effect of job losses in ‘traditional’ areas and new job growth requiring new ‘digital’ skills is likely to lead to a significant reorganisation of roles across retailers.

The survey also found that the shift to automating more jobs in UK retail is very much underway, with a quarter of IT leaders piloting or implementing Robotic Process Automation (RPA) (25%) and/or AI/machine learning (27%). Those IT leaders piloting RPA reported that they are more likely to have higher profitability, better operational efficiency, better time to market, and better customer experience.

Albert Ellis, CEO of global tech recruiter, Harvey Nash, said:

“Whilst most consumers’ experience of retail automation may be the frustration of having an ‘unexpected item in the bagging area’, this Survey shows how the influence of automation is being felt across the entire retail organisation.

If you also consider the radical changes happening in the high street, and the explosive growth of online commerce, it’s clear the retail sector is undergoing massive change. But, while much of the narrative has been around what jobs might be lost, the real battle for success will be around which retailers will be able to attract and develop the right skills and talent for this new automated, digital world.

It has never been more important for Boards and HR leaders to think about the impact of these trends on their strategy.”

The CIO Survey researched IT leaders in UK retail, with over half (50.8%) from retailers that spend over $10m a year on IT, and around a third of these (16.4%) spending in excess of $100m annually. The survey also revealed that the vast majority (80%) of CEOs in UK retail want their IT investment to make the business money rather than just reduce costs.

Critically, retail boards and their IT leaders are not only investing in RPA and AI/machine learning to drive efficiencies, but they are also looking for technology to help solve their resourcing issues and keep up with competitors. Over two thirds (67%) of IT leaders in the sector reported that a skills shortage is preventing their business from keeping up with the pace of change.

Albert Ellis, CEO of Harvey Nash, concluded:

“The rapid deployment of new technology in the sector has allowed retailers to replace skills which are in short supply with automated solutions. But, at the same time, technology has created new roles in areas such as big data/analytics – and retailers are now reporting that they aren’t able to find enough data scientists to fill these vitally important roles.”   

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