Robotic process automation is a quiet riot. There are no flashing security cyborgs or towering mechanical arms. The software invisibly carries out more white-collar tasks, including administration and report writing. Robophobes may never know what hit them. Some could lose their jobs.
This week, Morningstar deployed robots to write investment reports. The machine-generated prose explains the rationale behind the data group’s fund ratings. For Lex writers and financial analyst contacts, it is all getting dangerously close to home.
RPA was already growing fast. The pandemic has amplified sales. Global revenue is likely to reach $1.89bn this year, up nearly a fifth on 2020, according to Gartner. The consultancy expects 90 per cent of large companies to use RPA in some form by next year. Banks and insurance companies are most enthusiastic.
UiPath has seen its moment to go public. One of the most valuable private tech companies in the US, last valued at $35bn, it offers to replace admin jobs for customers including Toyota and Uber.
Critics say plugging software into legacy systems simply puts off doing away with the tasks altogether. Moreover, profits are elusive. RPA should be a high-margin business, but marketing costs are high. UiPath, founded in 2005, reported net losses of $92m on revenue of $608m last year. Smaller, listed rival Blue Prism does not expect to break even until the end of this year.
UiPath has at least set itself apart by focusing on more complex services. R&D is about a third of sales and marketing costs. At Blue Prism is it a fifth.
The broader question is this: who gets to decide which jobs require automation? JPMorgan says AI can review commercial-loan agreements. VC firm EQT Ventures is using AI to rank investments. In 2014, Automated Insights began writing earnings reports for the Associated Press.
Last year, economists at MIT and Boston University attempted to calculate exactly how many jobs have been lost to robots. Between 1993 and 2007, they found that US companies added one robot per 1,000 workers in the US. The employment-to-population ratio fell 0.39 percentage points compared with areas without robots.
The utopian vision of RPA software is that it will free up workers for more valuable tasks. Less time entering data into spreadsheets, more time dreaming up new lines of business. That might be so. But in the short term, job losses are inevitable.
Lexbot would like to thank web spiders and investment algos for parsing its prose for buy/sell/hold cues. AI programmes can post their auto-generated responses below. The views of human readers are also welcome.
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