Automation and the future of employment

The rapid growing of computing power indicates that more and more activities that once seemed reserved for humans can now be automated by machines and algorithms.

What is automation?

The internet of things, artificial intelligence and machine learning make the automation of processes in the workplace unstoppable, as that automation leads to more profitable businesses by achieving greater efficiency and productivity.

Companies, large and small, are increasingly taking advantage of the benefits that automation offers, and therefore the automation of work will gain strength in the coming years.

Pros and cons

This technological change has led to a public debate on the possible loss of jobs and the threat of mass unemployment. From a scientific point of view, these so-called 'bad news' are clearly exaggerated for these three reasons:

  • The technological potential to automate work is often overestimated.
  • Not all automation potential is actually used in practice.
  • A division of labor between man and machine which is constantly flexibly adapted prevents job losses in many cases.

Therefore, the end of work is not in sight, despite the ever-increasing technical possibilities. Even if this far-reaching structural change poses new challenges for the workforce.

How will automation affect employability?

Technological change has not only generated hopes for greater prosperity, but has also fueled fears that human labor may become superfluous and that unemployment and poverty will increase.

It is therefore not surprising that the current technological revolution - often referred to as digitalization - is generating equally pessimistic voices. Considering that past industrial revolutions did not ultimately cause mass unemployment but increased prosperity, it is nonetheless said that current technological developments can potentially lead to the end of work.

Adapting to the changes of the future

Only about 10% of employees have a job with high automation potential. However, this potential does not need to be fully exploited; not all technical possibilities are economically profitable, ethically justifiable and legally possible. The diffusion of new technologies in the economy is therefore a slow process that allows employees to have time to adapt.

In fact, much of the adaptation to automation is not making the seemingly replaceable professions obsolete, but employees in those occupations are taking on other tasks.

This flexibility of employees is thus an important adjustment mechanism. Being in an “endangered” occupation does not necessarily mean that there is a risk of losing the job, as long as the skills needed to meet changing requirements can be acquired.

After all, automation displaces jobs, but at the same time creates new ones through the demand for new complementary activities, on condition that new necessary skills are acquired to meet changing requirements.

Empirical studies show that new automation technologies do not often have a significant effect on overall employment, with positive or slightly negative effects depending on the context of the country.

This draws attention to the importance of the framework conditions under which digitization takes place.

We know that the effects of automation on employment will be more positive if the effects of automation on productivity are stronger, and if the labor market is more flexible since it allows the emergence of new responsibility areas and occupational profiles. 

The real challenge, therefore, is not the imminent end of work, but rather a far-reaching structural change that goes hand in hand with increasing demand in many professions. And, therefore, it hits those who do not have the necessary skills the hardest.

Society has two important tasks:

  • Ensure that the workforce receives and uses sufficient and adequate training and qualification opportunities.
  • Limit the negative effects on those who cannot adapt to the increasing demands, including through specific measures of professional transformation.

What about you? Are you willing to train and reinvent yourself?

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