Grocery Store Cashiers Today, Tax Lawyers Tomorrow: Trends in technology to Watch in Tax Law
While scientific progress is considered a universal good by most people, advances in automation have made some employees concerned over their labor security in certain sectors of the American economy. While we hear about this mostly in regard to industries like transportation and basic services, advances in automation are poised to have profound effects on all areas of the economy, and law is no exception. Here are just two ways that technology could change the landscape of tax law sooner than you think.
Firstly, there is tax outsourcing. Digital platforms make it easier to collaborate with contractors — including, for example, the growing number of knowledge workers in India. Firms that master offshoring could find relief from tight labor markets and rising labor costs, but offshoring comes with new management challenges and isn’t yet widespread among small firms, but the rise of tax outsourcing is certainly something to watch in the years to come.
And then there is the paid advance of automation. Simple methods of automation are broadly available. Everyone has seen the dwindling amount of cashiers in grocery stores as they are replaced by self-checkout, but as software becomes more advanced, it is beginning to encroach on more complex labor, as well. It’s now commonplace to use scan-and-fill technology to extract digital information from paper documents. Some firms are using robotic process automation (RPA) software that can automatically click through software interfaces to translate information between programs. In the long run, programs like RPA could take over most basic data-entry services. And while basic data entry may be a chore most firms would gladly relinquish to technology, it is unlikely that the automation wave will stop there.
The tasks most likely to be automated or outsourced are repetitive and simple, for now. As time goes on, the firms of the future will be competing on the ability to manage automation and outsourcing to deliver the specialized products or meaningful insight that they are increasingly able to provide. As technology continues to change the landscape of the economy, tax law firms are by no means excluded from having to adapt, or they risk falling behind competition that will.