U.S. Lags in Robot Adoption, New Report Shows

November 19, 2018

WASHINGTON—Using robots in many sectors of the economy would improve U.S. productivity and economic growth, but a new report released today by the Information Technology and Innovation Foundation (ITIF), the world’s top-ranked science and technology policy think tank, finds the United States is trailing southeast Asia and parts of Eastern Europe in robot adoption. The report examines 27 nations and finds that, controlling for wage levels, the United States ranks sixteenth overall in its share of robots.

“Robots are key to boosting productivity and improving living standards, but there is a dangerous misperception that they will lead to mass unemployment,” said ITIF President Rob Atkinson, author of the report. “Policymakers shouldn’t let fear of job losses discourage robot adoption. The evidence is clear: using robots makes economies more competitive, which helps them grow and create jobs.”

The report relied on International Federation of Robots data for industrial robot adoption rates but adjusted the ranking to control for differences in manufacturing worker compensation. The decision to use robots usually weighs the cost savings that can be achieved when a robot can perform a task instead of a human worker, and those cost savings are positively related to the worker compensation levels. Higher wages lead to faster payback, making more robots a more economical investment.

On a compensation-adjusted basis, the report found that southeast Asian nations significantly outperform the rest of the world in robot adoption, with South Korea, Singapore, Thailand, China, and Taiwan the top five nations, in that order. Moreover, China’s rate of robot adoption is so high, fueled by massive government subsidies, that if China and South Korea’s respective growth rates continue, by 2026 China will lead the world with the highest number of industrial robots as a share of industrial workers, when controlling for compensation levels.

“Asia is sprinting ahead in robot adoption, while the United States is lagging behind,” Atkinson said. “If the United States wants to remain globally competitive, it must adopt policies that spur faster, deeper, and wider adoption of robots throughout its economy.”

Read the report.