There are a few problems with your thinking.
1) It assumes there is a massive portion of the people willing to work for dirt cheap and be poor. Very poor. I don't think that is the goal of any modern society.
2) It assumes that there is some kind of permanent labor shortage that will only grow. This is most definately not true. As new technology comes out it creates more jobs then it kills, then in the long run it kill more then it creates, but then more technology comes out that again creates jobs.
3) It would kill GDP. Just look at China were there is very little automation. There GDP per person is around 8400 compared the the US of 48k.
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita
Meaning the average US worker produces 8k as much stuff, and should have about 8X as much stuff (varying dependant on distribution of wealth in each country). Are YOU willing to gives up over 80% of your stuff just so there is no automation? I think the answer is a resounding no.
In certain countries it doesn't make sense to go from no automation (low GDP, low wages) to fully automating everything. So I agree with the example of South Africa (11k GDP per person). Yet, as GDP grows, wages tend to grow, and some sort of automation becomes necessary. Take for example the US. Minimum wage here is $7.50. If the lawnmower costs $120 and it takes 1 person 8 hours to mow this field, your talking $60 a day in wages. Three people would cost $180 a day, literally the lawnmower would pay for itself in a single day.