Automation from farm to table: Technologys impact on the food industry – Brookings Institution

The COVID19 pandemic has negatively impacteda number ofindustries, perhaps none more thanthose engaged infoodpackaging,preparation,and service. The impact on the consumer end is well-discussed. Because of social distancing and other precautions related to employeeand patronhealth and safety,many restaurants still operating do so well belowcapacity. Others have suspendedoperation;six in ten will not reopen. It is not, however, only restaurantsand bars that have taken a hit. The meat-packing industry, for example, experienced a substantial number of infectionsover 17,000 in April and May alonethat have led to shutdowns and supply disruptions, leading to shortages and increased pricespaid by the public.

Concerns about the pandemic and the necessity of maintaining our food supply chains have pushed many businesses in theseindustriesto increase their investments in automating or artificial intelligence technologies. In many cases,this is just an acceleration of preexisting trends. Tyson Foods, producer of roughly 20percentof US produced chicken, beef, and pork,investedmore than 500 millionin automation and related technological advancements in the last three years alone.

Of course, given thatagriculture, food, and relatedindustries employ a significant fraction of theworkforce(10.9 percent of U.S. employment),movement toward automating technologies may be alarming to some.It is important to recognize, however, that the net effect of labor displacement depends on the nature of the new technology. It is instructive to survey which automating technologies are beingadopted atdifferent points of the food supply chain to better understand their impacts on this sector.

The industrial agricultureand food(agri-food) industry is responsible for feeding the US and many of its trading partners. In a push towards greater efficiency and scaleto meet the needs of the future,industry leaders haveinvestedin robotics and automating technologies. Some key areas of development include automated irrigation, fertilizer, harvesting, and breeding systems.These process improvements are aimed at reducing productioncostsand conservingwater, fuel, and fertilizer.

Many of these technologies are not only efficient, they are labor replacing. Spurred in part by the shortage of workers to pick fruit, some large commercial firms have employed harvesting robots that can cover the acreage of multiple workers. Given the impact ofCOVID19 on borders and worker flows into and across the US, many firms have strong incentive to continue to invest in these technologies, further reducing the need for human labor. The advent of driverless tractors and sprayers will further reduce the need for large day-to-day staffs.

Further along the supply chain, we see an acceleration of automation adoption at distribution warehouses and grocery stores. Many warehouses have replaced traditional forklifts withautomated guided vehicles (AGVS) that can perform a suite of tasks previously performed by multiple employees: unloading and loading trucks, and transporting large items across warehouse floors. They can also perform operations in harsh conditions like freezers and cold storage environments for longer periods.

Likewise,at grocery stores themselves, the pandemic has intensified technology use. We have seen more reliance on self-checkout cashiers andother types of kiosksthatfacilitate social distancing. But, as noted in theNewYorkTimes, thegrocery industryisleaning more on automation to free up employees to deal with the crush of demand during the pandemic. Specifically, the story quotes a representative fromBrain Corp, afirm that designs softwareused in automated floor cleaners, who states that autonomous floor care robotusage has risen in recent months toabout 8,000hours of dailyworka13%increasefrompre-pandemicuse. This is work that otherwise would have been done by an essential worker, and thus allows these workers to engage in ostensibly more productive activities.

Automating technologies could be poised to fundamentally changefood preparation anddining experienceat some restaurantsin the post-COVID era. According toananalysis byMcKinsey & Company,nearly three quartersoffood service and accommodationstaskscould beautomated.These span a broad number of tasks;industrial robots work in concert with AI, thermal scanners, and lasers to chop vegetables, grill hamburgers or other foods, orperformsimilar tasks.AI is now being used toimprove cooking processes including optimizing recipes and ingredient selection.Similarly,at the frontend of restaurants, we could see substantialtechnology-drivenchange.In particular,we could see movement towards more automated service where voice- or facial recognition-activatedcashiers could take orders and payments or assign tables.

There will likely be substantial heterogeneity across restaurants in this adoption as, unlike backend operations, it is unclear how amenable potential diners will betothese technologies. As noted in a recent report issued by Oracle,four in ten consumerssaid theyd visit a restaurant less often ifitused greeting robots. It is not justdiners.76percentof restaurant operatorssay that its appealing to use robots for food quality checking, but nearly a quarter said they werenear-sure thatthey were fully againstsome tech. This suggests that we might see sorting across restaurants depending on tastes and preferences for atechnologicallydrivenexperience,where there might be a premium associated with human customer service.

These technologies represent promising developments for maintainingand expandingour food supply chains.Policymakers may consider incentivizingtechnology expansioninthe foodindustry asit continues tohold the promise of making production and supply processes safer, more resource efficient, and more productive, which will result inlower food prices and other positive spillovers to society.

There is potential peril as well. Many of these technologies are labor saving,meaningthey replace the need for human labor to perform certain tasks. In some settings, these technologies will be complementary, freeing up labor to perform more productive tasks. But in mostcases, adoption of these technologies will likely mean job and industry displacement for workers. Atmost risk, of course, are vulnerablemiddleandlow-wage workers in every stage of the food industry,from the fruit pickerto therestaurant hostess. Given the number of workers employed in the food industry, such displacementmaybe highly disruptive to the lives of workers and their communities.

In anticipation, policymakers should belaying the groundworkto support displaced workers including: (1) forming partnerships with private sector employers to facilitate targetedretrainingforworkers that allows them to reenter the labor force quickly and with a stronger set of skills; and(2) establishing robust income and other social insurance support to allow them to effectively retrain.

COVID19is undoubtably accelerating change in the food industry. Many of these changes willlikelylead to a safer, more efficient, and more robust food supplysystem in the faceof this and potential future pandemics and related disasters. However, it is important to recognize thatthese changes often bring disruption to the wellbeing of workers in the industry and their families. It will be important for the policymakers tofacilitate solutionsaimed at mitigating potential harmsto these workers and help them transition to this new economy.

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Automation from farm to table: Technologys impact on the food industry - Brookings Institution