Robots shift food jobs, not remove them
CLAMSHELL grills are making burger flipping obsolete at McDonald’s and other burger chains. Digital kiosks, tabletop tablets and cellphones are taking orders at eateries such as Domino’s Pizza. And at Silicon Valley start-up Zume, robots are being programmed to take over pizza assembly.
Such labour-saving devices have been held out as counterweights to efforts to raise the wages of the lowest-paid workers in the US. But the early evidence suggests robots and other forms of automation are merely reshaping the work of people in food service. They are not — as they have in banks, on factory floors and in other sectors — replacing them.
In spite of improvements in technology, minimum wage hikes in 2000-08 caused little immediate displacement of workers by technology, especially in kitchens, according to a study by economists at the Federal Reserve Bank of Chi-cago and DePaul University.
There were slightly more workers per restaurant in 2015 than in 2001, according to data compiled for Reuters by the National Restaurant Association, which opposes minimum wage hikes.
And the US Bureau of Labor Statistics has projected leisure industry jobs, a broad category that includes restaurants, will grow at a rate of 0.6% annually, keeping pace with the national average to 2024.
Automation in the restaurant industry looms large in the heated campaign to raise entry-level pay to $15 an hour, more than double what US federal law now mandates.
Restaurants employ more low-wage workers than any other industry, and their operators are among the most vocal opponents of minimum wage hikes. Several executives have said major pay hikes would force the fast-food industry to ramp up automation, an investment that would cost thousands of jobs.
"The numbers just don’t work for raising the minimum wage this dramatically," says Andrew Puzder, CEO of Carl’s Jr parent CKE Restaurants. "It will kill jobs."
Robotics researchers, restaurant executives, industrial engineers, consultants and economists say, however, that automation in the restaurant and fast-food sectors is not as simple as installing automatic tellers in banks or employing robots to assemble cars.
While any rise in the minimum wage puts pressure on restaurant operators, they say a robot revolution in the $783bn US restaurant industry is still years away.
Sixteen US states have increased their minimum wages in 2016, and some including California and New York, will move over several years to $15 an hour. More states are considering such measures, and Democratic presidential candidate Hillary Clinton has vowed to increase the federal minimum wage.
"It’s not like we’re at the precipice of a revolution where the minimum wage goes up, and all these jobs disappear," says Ken Goldberg, a professor of engineering and director of the People and Robots Initiative at the University of California, Berkeley.
Many kitchen jobs are still too complex for robots, which cannot multitask and do not necessarily work safely with humans in cramped spaces, experts say. While robots excel at complex calculations and precise, repetitive tasks, they have difficulty doing some things that are easily mastered by small children, such as stacking blocks and sensing objects in space.
Moreover, most restaurants serve a range of menu items, each of which might need numerous specialised forms of automation.
Sit-down restaurants have additional tasks that are hard to automate including setting and clearing tables, refilling coffee cups and answering questions about what is on the menu.
Burger King attempted a potentially sweeping automation overhaul in the 1980s. It designed machines to take orders; broil, assemble and package hamburgers; cook and portion chips; and serve drinks. But new management came in and shelved the project.
It is not clear why. Among the questions at the time was whether the machines would be a "maintenance nightmare", but the system was never broadly tested, recalls Nelson Marchioli, who had a long career at Burger King before moving on to executive roles at other restaurant chains.
"It’s nothing that money and time can’t fix, but how much time and money do you want to invest?" Marchioli asks.
Maintenance of automated systems can be costly. When they break down, they bring operations to a screeching halt, alienating customers, restaurant operators say.
In other industries, such as car plants, breakdowns can be costly, but delays do not immediately frustrate consumers in the way a late pizza angers a hungry family.
Thomas Willis, an industrial engineer who was part of Burger King’s project, says many restaurant operators still do not have the appetite for the kind of investment risks such efforts require.
"The fear of walking away from what works already is huge," he says.
But Silicon Valley is nurturing an appetite for risk and experimentation in the kitchen. Momentum Machines has built a device to make gourmet burgers "with no human interaction". City permit data show it plans to open a restaurant in San Francisco.
Zume Pizza, a Silicon Valley delivery start-up that has raised $5.7m in venture capital, says robots will be building and baking pizzas by themselves within six months. Already, a robot named Pepe squirts tomato sauce onto the dough; the sauce is spread by another called Marta. After people add cheese and toppings, robot Bruno moves the pizza from a conveyor belt to an oven.
Co-founder Julia Collins says one of Zume’s biggest challenges is maintaining the perseverance it takes to overcome technological difficulties. It took months, for instance, to get Marta to spread the tomato sauce with enough precision to keep on the pizza.
Zume’s first robot workforce cost $3m to develop, and the company believes it will be able to start new locations for between $750,000 and $1m. Once fully automated, Collins predicts, the pizzeria’s labour cost will be about 14% of revenue, about half that of the competition.
Domino’s Pizza CEO Patrick Doyle says the worldwide chain will not embrace the Zume model any time soon. At $250,000 to $300,000, setting up a Domino’s location is a fraction of Zume’s estimated launch costs. And, he says, customers like seeing people in the kitchen. "I don’t know that people want their food out of a machine. There is magic in a hand-crafted pizza."
With states and municipalities moving to raise wages, restaurant owners and their suppliers may be more inclined to invest in automation, says Juan Martinez, principal of Profitality, an industrial engineering consulting firm for restaurants. But single-task robots may not be a better option than workers, he says.
"It is not ‘if you build it, they will come’, since the return on investment is not there yet," Martinez says.
Most of the movement towards technology in restaurants has been at the front end. Eatsa, an updated automat, offers its quinoa bowls at outlets that have largely eliminated front-of-the-restaurant staff. Customers order on tablets and pick up their food minutes later from small cubicles.
Several chains are using kiosks and other technology that allow orders to be placed more rapidly and efficiently. Such systems can pay off in two or three years, according to an analysis by Cornerstone Capital Group analyst Mike Shavel.
Domino’s Pizza and Panera Bread say their custom-built ordering and payment systems have removed bottlenecks at peak hours.
But the changes have not eliminated jobs; rather, they have shifted them into kitchens and delivery.