The Future is Now: How Humanoid Robots Will Transform Our World
Imagine a future where humanoid robots are not just a figment of science fiction but an integral part of everyday life. According to a recent report by Ark Invest, this future might be closer than we think. The report delves into what the economy and the world might look like when humanoid robots proliferate into every aspect of our lives.
Ark Invest, an investment firm founded by Cathie Wood, is known for its hyper-futuristic investment strategies. They focus on technologies that might not come to fruition for many years, investing in disruptive innovations like autonomous tech, robotics, genomic revolutions, and space exploration. One thing that sets Ark Invest apart is their open research strategy, which allows us to gain insights from their groundbreaking reports.
Elon Musk, during Tesla’s first-quarter earnings call, shared a vision that is turbocharging the robotics industry. He stated that if we had sentient humanoid robots capable of navigating reality and performing tasks on request, there would be no meaningful limit to the size of the economy. Tesla is already working on its humanoid robot, Optimus, and other companies like Boston Dynamics and various Chinese firms are also making strides in this field.
Economic Impacts and Projections
According to Ark Invest’s report, even before humanoid robots achieve the ability to do everything humans can, their mere ability to operate at scale could generate 24 trillion in revenue, split roughly equally between household and manufacturing robotics. This means robots could assist in household chores, security, and manufacturing, effectively taking over dangerous jobs.
The report breaks down the potential market for household robots by calculating the value of unpaid work. They estimate that humans spend 2.3 hours of unpaid work per day. When multiplied by a working-age population of 2.8 billion, and considering a weighted average hourly wage, this translates to a 12.5 trillion opportunity.
In the manufacturing sector, the numbers are equally staggering. There are 12 million people in the U.S. manufacturing sector, working 23 billion hours per year, earning 785 billion in pay to produce an output worth 2.4 trillion. If robots were to replace all human workers, the sector would need only 5.9 million robots working 16 hours per day to deliver the same level of output. This would reduce payroll costs by half while maintaining the same output levels.
Humanoid robots are expected to debut at higher price points and be less capable initially. However, they will become more economically viable as their Net Present Value balances the cost against productivity gains. For instance, a humanoid robot costing 116,000 would need to deliver just a 5% gain in productivity to be viable compared to its human counterpart.
Impact on Business Sizes
The report also highlights the importance of company size in the context of humanoid labor. Large manufacturing firms, due to their specialized and automated tasks, are more likely to benefit from single-task automation solutions. In contrast, small firms, where employees wear multiple hats, would gain more from generalizable humanoid robotic solutions.
Interestingly, 40% of U.S. manufacturing employees work in small firms. Small businesses, often termed the lifeblood of the economy, stand to benefit disproportionately from humanoid robots, which can take over multiple roles, thereby reducing labor costs significantly.
Accelerated Adoption Due to COVID-19
The COVID-19 pandemic has accelerated the need for humanoid robots. Supply chain shocks and labor shortages have made businesses more aware of their vulnerabilities. Onshoring and the need for reliable manufacturing processes make humanoid robots an attractive solution, lowering management sensitivity to price and accelerating the transformation of manufacturing.
As we move towards the end of 2023, it is becoming increasingly clear that 2024 could be the year of humanoid robots. Companies like Tesla, Boston Dynamics, and Figure are making incredible progress in this field. The blend of hardware and AI software in humanoid robots is a fascinating development that promises to revolutionize our world.
In conclusion, the proliferation of humanoid robots holds immense potential to transform various sectors of the economy. From household chores to manufacturing, these robots could take over tasks that are currently performed by humans, thereby increasing efficiency and reducing costs. As we stand on the cusp of this technological revolution, it is exciting to imagine the possibilities that lie ahead.