Adapting the labor market to a world of increasingly automated workplaces is becoming one of the defining challenges of our era.
Fears about the impact of technology on the labor market are nothing new. In the early nineteenth century, a group of English textile workers known as the Luddites worried that new technologies like power looms and spinning frames would cost them their jobs. They protested by smashing the machines.
Today, anxiety that new technologies could destroy millions of jobs is as high as ever. In the midst of a major employment crisis, technology continues to reduce the labor needed for mass production, while the automation of routine legal and accounting tasks is hollowing out that sector of the job market as well.
“Every year, an additional 200,000 industrial robots come into use. ”
Adapting the labor market to a world of increasingly automated workplaces will be one of the defining challenges of our era.
Yet no country can afford to ignore the transformation. Globally, some 200 million people are unemployed, up 27 million since 2008. There is a critical need to anticipate coming technological changes and provide the global workforce with the education and skills needed to participate in the modern labor market.
Worldwide, one-third of employers surveyed complain that they are unable to find workers with the right skills for existing vacancies. Efficient paths from training and education programs to the world of work must be built, so that skills can be matched to market demand.
Government programs must be strengthened, and employers and trade unions must assume greater responsibility for investing in skills. They also must consult more closely with educators and policymakers – discussions that should be informed by labor-market information, performance reviews, and the availability of employment services.
Making the Investment
Whatever a country’s development level, investment in education and skills will increase the ability of its workforce to innovate and adapt to new technologies.
“ Sustainable economies must offer protections for workers in good times and bad. ”
In addition to training the labor force for an age of further automation, sustainable economies must offer protections for workers in good times and bad.
The nature of a worker’s relationship with his or her employer is changing. People entering the labor market are increasingly finding only short-term or temporary contracts; often, they are forced to take informal work or emigrate for a job. These trends are exacerbating income inequality.
As a result, mitigation policies are necessary. Along with a robust system of unemployment benefits, social protections such as healthcare and pensions are essential for overall worker security and to ensure a healthy economy. And yet only 20% of the world’s population has adequate social-security coverage; more than half lack any coverage at all.
That is why the work of the International Labor Organization, which was established in 1919, is still relevant today. In a world of increasingly automated workplaces and eroding employee-employer relationships, the values encoded in the ILO’s labor standards are more necessary than ever.
“ Social protections such as healthcare and pensions are essential for overall worker security.”
Our world has changed vastly over the past century – and not only because of technology. By 2050, the global population will surpass nine billion. The number of people aged 60 years and over will have tripled. Three-quarters of the elderly will be living in what are now developing countries, and the majority of them will be women.
These demographic shifts will further revolutionize the labor market, social-security systems, economic development, and the world of employment.
For all of the progress human society has made since the era of the Luddites, a simple truth persists: machines must strengthen, not weaken, our prospects for inclusive growth and broadly shared prosperity.
This article first appeared on January 22, 2015 on Project Syndicate and was republished with permission.