The World Economic Forum’s Future of Jobs Report 2018 gives some cause for encouragement. The business perspective on how technology will affect growth and job creation is becoming more positive, the survey results show. As the International Labour Organization (ILO) approaches its 100th anniversary, we are also reflecting on these issues through the Future of Work Centenary Initiative. I would like to share some of our thoughts on policy and trends.
The new reality of technology in the world of work – the so-called Fourth Industrial Revolution – is already here. While countries are feeling the effects in different ways, at different speeds and to different extents, it is already clear that many jobs are disappearing or being redesigned. This raises new economic, legal, ethical and social considerations.
One such issue is ensuring that the workforce has the skills needed to support new technologies. Our research shows that the digital divide between developed and developing countries is becoming more acute, and is the result not only of business cost-benefit decisions but also of workforce capabilities. By capabilities, I mean not just the higher-level technical and vocational skills needed to design, operate and maintain digital infrastructure, but also basic skills and ICT proficiency. The message is that skills matter, if we want to use technology to decrease, not increase, inequalities.
So far, this wave of technological change has not brought about an overall reduction in employment, as the Forum’s report confirms. While the change has affected certain sectors and occupations negatively, it is generating many new jobs in others, both directly and indirectly.
However, we need to prepare for the replacement of a broader range of tasks, thanks to the rapid development of machines capable of learning, known as artificial intelligence (AI). In particular, service sector jobs such as business administration, transport and healthcare, which have so far experienced little disruption, may see job profiles and opportunities shift significantly.
Yet automation in these sectors, correctly applied, could bring significant benefits to both developed and developing countries. Those with intermediate and lower skill levels may be able to obtain improved conditions in production and work, while in developed economies, AI may allow productivity growth to pick up again.
But let’s be clear that we are talking about potential benefits here. What we will actually see depends on how the transition for workers and companies is managed. Workers will need to learn new skills or undergo retraining, with a particular focus on ‘soft’, social and interpersonal skills. If workers can adapt quickly, a productivity revival could generate more jobs, in both existing and new occupations, and absorb the rising number of labour market entrants, especially in developing countries.
Not only could this transformation contribute to higher wages and living standards, but it could do so in ways that are ‘green’. New technologies offer win-win possibilities for reducing use of energy and resources, while offering substantial productivity and competitiveness gains.