Disruption to Service Industry

On the 1st September 2015, Eatsa, a high tech fast food restaurant opened near San Francisco’s Embarcadero. Eatsa revolutionaries the dining experience with full automation of all processes besides cooking and eating. With the exception of a few kitchen staff, there is not a human in sight. The restaurant has received good reviews. This marks a new era — technology has begun disrupting the low skilled service industries.

Technologies have always disrupted industries. And disruptions are not always friendly. When personal computers became affordable, many processes were made more efficient. Less workers were required. The same happened within manufacturing over the last few decades. Today, the number of workers required in an automobile factory is a fraction of the number required 30 years ago.

But why is this development unsettling for Singapore and our region? Eatsa marks a tipping point because entrepreneurs have finally commercialized this automated solution. It no longer remains in the scientific repositories of institutes.

Our service industries provide a lot of low skilled jobs that were harder for machines to replace. Unlike the jobs of welders and technicians, it was harder to replace the work of waitresses. Within the next decade, this technology will become cheaper. Owners of F&B outlets can access this technology. Needless to know, low skilled Singaporeans must brace themselves for change.

Policy makers cannot shield Singaporeans from these changes. It will be worse for Singapore or any country to regulate such technologies. In fact, it makes more sense to adapt to such changes quickly.