Industry 5.0 Vision for The Future of Industry

Overview

In 2021, the European Commission published the Report “Industry 5.0” to make sure that innovation development and application in industry contributes significantly to key priorities of sustainability and climate neutrality, resilience and well-being of individuals and society as a whole, and resilience of value networks. The observations that industrial manufacturing creates prosperity but also damages and exhausts the environment, deteriorates health and work conditions and creates fragilities in supply chains, as became visible during the pandemic, triggered the Commission to act. Awareness building and policies for research and innovation, social policy, education, taxation, energy and industry policy have been put in place to transform industry in a broader manner than focused only on technology, and impact the natural and social environment in a positive manner.

Genesis and Rationale

The concept of Industry 5.0 surfaced in 2020 during a workshop with research and technology organizations, where it was decided to shift the focus from individual technologies to a systemic approach. Six categories of technologies were selected to deliver their potential in combination with each other with the intent to contribute to the three priority domains of environmental and social sustainability, and resilience.

The rationale for launching the concept was a series of observations:

1. Innovation is key for industry competitiveness. The resulting industrial transformation and globalization have created prosperity for some, but deteriorating conditions for others, pollution and exhaustion of resources, and fragilized supply chains.
2. Industry 4.0 is being implemented in a gradual rather than in a disruptive way, related to a lack of infrastructure, investment capacity and skills, possibly societal fears related to the transformation, and a very heterogeneous landscape of industrial companies, with highly variable levels of technology and digital capabilities.
3. Changes in society will have an important impact on industry as well.  The “Green Deal,” requiring a transition to a circular economy, and digital industry and skills strategies will change potential digital innovation and transformation.

The European Commission’s view is that Industry 5.0 is an appropriate response to these observations, and is a complement to Industrie 4.0, not a replacement or a successor. Input for the concept came also from the Society 5.0, a concept launched in 2016 in Japan, which attempts to balance economic development with the resolution of societal and environmental problems.

Industry 5.0

Rather than only focusing on the economic outcomes of technology, Industry 5.0 aims to put the human interests and needs at the heart of the production process. Not only should technology not harm or impinge on worker’s rights, but it should help adapting the process to the worker. This is related to the imperative that industry is sustainable. Industry 5.0 aims to help make processes circular: reuse, repurpose and recycle natural resources and minimize waste and pollution. In a recent policy brief, the European Commission added the concept of regeneration of natural systems and enhancing carbon sinks to the key system principles of circularity it wants to see implemented. Industry 5.0 should make industrial production also more robust against disruptions in demand, supply and remodeling value chains.

The social benefits would include processes that are better adapted to human needs. Construction, transportation and manufacturing have the highest rates of accidents among all sectors. The potential of improved adaptation to the worker could therefore significantly impact worker health. Mental health has recently become of important concern and would also be improved. The worker should also be more empowered and benefit from a more inclusive environment. This transformation must rely in part on human skills and attitudes, but can also be helped by technology, for example by making work more accessible for people with less or diminished physical or cognitive aptitudes. It is obvious that those social and health-related benefits create important economic benefits at the same time by diminishing the number of people depending on state aid, in addition to reducing medical cost.

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Keywords: Industry 5.0, European Commission, Sustainability, Society, Resilience, Benefits, Regenerative Circular Economy, Competitiveness, ARC Advisory Group.