[1/10/17] If the economy is doing so fine, then why are so many retail giants going out of business?
The old way of doing things is no longer profitable. Humans cost to much money to maintain in the work force. The need and means for automation to replace many/most workers is upon us. What will be the societal implications resulting from this unavoidable development?
The Christmas shopping season concluded over two weeks ago and retail report cards are coming and they are beyond bleak. There is currently a plethora of retail outlets closing their doors for an ever-increasing amount of corporate chains.
Sears for example is closing another 150 stores and the corporate giant is approaching $2 billion in debt. Limited stores nationwide have officially closed their doors. Macy’s is laying off 10,000 employees and closing over 100 stores. Aeropostale and Sports Authority among several others, closed its doors this past year. This is the pattern. This is not a trend but a reality of life in corporate America.
As the corporate woes go, so goes the woes of its many employees and former employees. as almost 66% of all Americans are living paycheck to paycheck. Well, what about the profitable companies is we can learn from their success.
Amazon, one of the few winners of the holiday shopping wars, employs more than 220,000 people and is growing fast. Disturbingly, Amazon is following a path that is going to lead to more and more automation and eventually is going to replace the majority of its human workforce.
Amazon’s warehouses are already somewhat automated, with a growing number of warehouse centers that are growing exponentially. These centers use a labor saving device called Kiva robots to perform mundane tasks such as carrying shelves of products to human workers.
Amazon is dependent upon automation because if it had to solely depend on its human labor force, the corporate giant would not be able to keep up with its shipping demands. This is an ongoing and pressing need with regard to the need to automate is inextricably tied to profit.
Amazon has a short-term goal of replacing 45,000 of its 225,000 human workers with robots. If Amazon, the winner of the holiday shopping wars is moving in this direction, what must the other retailers, who took a financial bath must be thinking?