It’s time to shift our focus to Physical AI
If your job is manual – this video says the robots are coming for your job. There is nothing you can do about it, and your government is so far behind it is laughable. When it happens — and it will be this decade — the Gov will scramble and try to create laws and policies to circumvent the deluge, but it will be too late. If what you just read means anything, it’s this: Pay attention to this shift, because it will make LLMs look like child’s play, and only those who participate in new technology ever have a chance of shaping its deployment.
The machine is greater than the screen
LLMs are not the revolution that matters. They are the spark in the laboratory.
ChatGPT, Claude, Agentic AI and friends are merely early signs that something far larger is being assembled (pun intended). They won’t create the job apocalypse; they are the mind the machines have been waiting for.
For two centuries, machines have had muscle but no mind. Now, for the first time, we are giving them one. The real employment shock will arrive when artificial intelligence escapes the screen, enters the physical world and begins to see, decide and act. LLMs are not the finished product. They are the operating system for a new species of machine — machines that make, build and do, not just push pixels across a screen.
Take a look around
Despite the fact we spend a zillion hours a day staring at screens (story for another post), the world we live in is irrevocably physical. Everything that really matters happens off the screen. Just think: the reason we ‘watch it’ is because it actually happened — although these days, maybe it didn’t.
The food we eat, the clothes we wear, the homes we live in, the places we work, shop, socialise and play. How we move, travel, build, heat, cool, make, repair, exercise and interact. Roads, buildings, machines, materials, energy and human bodies. All physical. We even built a human-shaped world.
We may increasingly stare into pixels, but we still live in atoms.
The Robot Circus
Right now, a lot of robotics is still shits and giggles — MMA fights, dancing humanoids, robots walking down Chapel Street in Melbourne and the occasional machine glitching like a rabbit on acid.
But this is an old technological playbook. Before new technologies become economic engines, they usually arrive as sideshows.
Early electricity was presented by quasi-magicians who lit bulbs through their bodies, created sparks, delivered electric shocks and made objects seemingly move by magic. Cars were displayed at world fairs as strange mechanical curiosities, driven in circles for amazed crowds long before they rebuilt cities, logistics and global industry. The early internet gave us chat rooms, dancing babies, novelty websites and webcams pointed at coffee pots before it became the operating system of commerce.
We laugh at the spectacle because spectacle is how unfamiliar technology introduces itself. First, it entertains us, eventually it’s the fabric of the economy.
The robots dancing today will be working tomorrow — in factories, warehouses, farms, hospitals, construction sites and homes and almost no one is prepared. Except China.
Stats to Blow Your Mind: China vs the West
China isn’t missing the humanoid revolution. We are.
Chinese manufacturers accounted for more than 90% of the roughly 13,000 humanoids shipped globally in 2025. The country already has more than 200 humanoid manufacturers — the US has 3 — and every other Western country is a non-starter. Remember those photos of China in 1980 when streets were filled with people on bikes and there wasn’t a car in sight? That’s us now.
Last year, the Chinese Government invested US$20 billion in direct government subsidies, tax incentives and state-funded investment on humanoid robots. Meanwhile, the cost of building a humanoid fell by around 40% in a single year, with entry-level machines already selling for about US$16,000. Shipments are forecast to grow from tens of thousands today to 1.2 million annually by 2030 and 10 million by 2035. I think it will be more.
I think Western democracies are missing this shift because most influential people live and work inside financialised, information-based economies. They sit behind screens, attend meetings, move money and manipulate information. Manufacturing has largely disappeared from their daily field of vision.
In the West, somewhere between half and three-quarters of workers now perform knowledge- or information-based tasks, while a little over 10% work in manufacturing. In China, it’s more than 30% who work in factories. What we do — and what we see other people doing — shapes what we value, what we think matters and what we decide to invest in at scale.
Had Western countries retained stronger manufacturing sectors, humanoid robotics would probably be treated less like a technological sideshow and more like critical economic infrastructure. This may be the greatest opportunity Western economies have had in decades to reclaim production sovereignty from low-cost labour markets. And we are about to miss it.
The Humanoid Institute of Australia
Very soon, I’ll be releasing a white paper called The Steel Collar Economy with co-author Cameron Reilly. The paper covers the key technological and economic factors shaping a world filled with humanoid robots. It will also mark the genesis of the Humanoid Institute of Australia — a new organisation designed to prepare Australia, and the West, for this inevitable reality. It’s time to take hold – be deliberate and participate, because the social outcomes of new technology technology is always a choice that is made.
Keep thinking,
Steve.
** Get me into do a Keynote at your next event. I’ll use this as my testimonial!