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The Future of Work: The Impact of Smart Machines on Middle East Industries

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By Dr. Claudio Zito, Assistant Professor at School of Mathematical and Computer Sciences, Heriot-Watt University Dubai

The Middle East is witnessing a seismic shift in its industrial landscape, driven by the rapid adoption of automation and smart machines. As these technologies become integral to the region’s economic strategy, they reshape industries and redefine the nature of work. While the benefits are immense, including enhanced efficiency, cost savings, and innovation, the rise of smart machines also presents significant challenges for the workforce, necessitating a proactive approach to workforce development and policy-making.

Integration of Smart Machines in Key Industries

In the Middle East, smart machines have been integrated, particularly in sectors like oil and gas, manufacturing, logistics, and healthcare. Traditionally relying on manual labour and conventional machinery for their operations, these industries are now employing automation and artificial intelligence (AI)- driven systems to enhance their operational efficiencies and achieve competitive advantage.

For instance, in the case of oil and gas sector companies, there are AI-enabled devices such as IoT sensors that monitor facilities, predict maintenance needs at the equipment level and optimise production processes. AI in the oil and gas market is estimated to be valued at US$3.5bn in 2024 and expected to reach US$13bn by 2034, according to a new report from Future Market Insights on AI in the oil and gas market. From 2019 to 2023, the market registered a compound annual growth rate (CAGR) of 17.0%, and during the forecast period, the demand for AI in oil and gas is projected to be strong, with a CAGR of 14.1%. The motivation behind this sudden increase is due to operational cost reduction requirements and the adoption of safety enhancement measures, thereby addressing environmental concerns.

Automation is changing the face of the manufacturing industry. AI-powered robotic systems are increasing productivity while reducing human error rates. For example, the United Arab Emirates (UAE) invests heavily in smart manufacturing under its Fourth Industrial Revolution (4IR). The 10-year strategy of the Ministry of Industry and Advanced Technology (MoIAT) seeks to expand the industrial sector’s contribution from AED 133bn to AED 300bn by 2031.

Additionally, NEOM, a futuristic smart city being built by Saudi Arabia, plans to have more than 200,000 robots roaming around by 2030. The country also plans to automate 4,000 manufacturing plants in the next five years. This transition will enable manufacturers to produce at a faster pace while ensuring higher quality and lower cost, thereby ensuring global competitiveness.

Similarly, the Middle East’s logistics and supply chain industries have seen a rise in the need for smart machines. Automated warehouses are becoming common, while AI-powered logistics management systems and self-driving cars are now being deployed. These developments assist firms in streamlining processes, leading to reduced delivery times and enhanced customer satisfaction.

In the UAE, some facility management companies aim to replace one-third of their labour force with robots by 2025. This could help the country with its Dubai Robotics and Automation Program, which aims to increase the robotics sector’s contribution to the gross domestic product by nine per cent by 2032. According to new statistics by Precedence Research, the global logistics automation market size will be USD 73.47 billion in 2024. It is expected to reach around USD 217.26 billion by 2033, registering a solid CAGR of 12.8% between 2024 and 2033.

In healthcare, the integration of smart machines ensures efficient operations as well as improved patient care services. The advent of AI-driven diagnostic tools, robot-assisted surgeries, and automated patient care systems have contributed immensely towards improving healthcare offerings across the world, especially within the Middle East region.

Benefits of Automation and Intelligent Machines

For instance, the adoption of smart machines has many advantages across industries in the Middle East, one of which is increased operational efficiency. In place of humans, automation and AI systems can carry out tasks with greater speed and accuracy, thereby leading to increased productivity levels. This is particularly significant for sectors like manufacturing and logistics that depend on swiftness and accuracy to prosper.

Moreover, there are cost savings. Companies can also save money by automating repetitive tasks, cutting labour costs, and reducing the chance of human errors that may be expensive over time. Besides, companies could avoid costly equipment breakdowns and downtime using AI-based predictive maintenance methods. According to a McKinsey report, AI-based predictive maintenance can cut maintenance expenses by 20% and unscheduled breakdowns by half.

Another advantage is innovation through smart machines. With AI and machine learning strategies, industries can tap into big data to create new products, services, or business models. The Middle East region is characterised by a strong push towards innovation as a means of economic diversification through governments. For example, the UAE has created many innovation hubs and accelerators for startups, including those involved in developing AI-based solutions.

Furthermore, smart machines can enhance safety in the oil and gas, manufacturing, and construction industries. By automating dangerous tasks and using AI to monitor and predict potential hazards, companies can reduce the risk of accidents and improve worker safety. This is crucial in a region where industries such as oil and gas are prone to high-risk environments.

Challenges Ahead for Workforce

The use of smart machines within the region presents huge challenges for the Middle Eastern workforce despite their significance. This includes the possibility of displacement from workstations. The automation process carried out by companies risks rendering certain positions irrelevant since human beings no longer do them. According to the World Economic Forum (WEF), automation could displace about 45% of jobs in the MEA region by 2030.

This possible displacement raises questions of unemployment and inequality, especially in countries where a great proportion of the total employed works in the industrial sector. Such potential risks call for proactive workforce development strategies, like reskilling and upskilling programmes, so that employees have the required skills to prosper in an automated economy, while tedious and risky tasks will be performed by machines.

Additionally, both employees and employers need to change their mindsets. Since smart machines take over repetitive chores, workers will have to acquire new skills such as problem-solving, creativity, or emotional intelligence that complement the capabilities of AI and automation. As a result, employers will have to foster a culture of learning, as many jobs would still require humans even if smart machines were introduced. Following this need, Heriot-Watt University in Dubai is establishing a Centre for Doctoral training (CDT) in the UAE, focusing on AI, Robotics, Net Zero and Construction in partnership with academia, government, and industry. The establishment of these CDTs represents a strategic effort to foster innovation, drive research excellence, and cultivate a highly skilled workforce tailored to the needs of these critical industries.

Conclusion

The future of work in the Middle East is being shaped by integrating smart machines and automation across various industries. These technologies will bring about substantive benefits, including increased efficiency, cost savings, and innovation, but they present challenges to demand-driven labour markets. To achieve a smooth transition into an automated economy, governments, businesses, and educational institutions in the region need to develop strategies for workforce development, foster continuous learning opportunities, and address ethical and social implications associated with automation. This way, the Middle East can fully exploit smart machines’ potential towards economic growth facilitation and better standards of living for its people.

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