Future-proofing work a huge challenge for policy makers

Cartoon with little people and robots
  • Published Date: 25 March 2019

Computers, robots, big data and artificial intelligence have already changed the nature of work, and many experts are predicting that a further swathe of jobs are susceptible.

This begs the question: are policy-makers ready for technology to hollow out the job market? And how will they adapt to an ageing workforce? 

Attendees at ANZSOG Thought Leadership seminars in Auckland and Wellington in March heard University of Melbourne Professor of Management Peter Gahan share his expertise on the effects of changing demographics and technology on the workforce.

This combines with an ageing workforce to upend the conventional structure of careersIn Australia, 17% of full-time jobs are held by people aged 55 and above, a percentage which has doubled in three decades while the share of full-time jobs held by younger workers has declined.

Professor Gahan said that while technology alters the bundle of skills, tasks and responsibilities that make up a job, so far the rapid growth in technology and artificial intelligence had been transformative rather than disruptive for most employees.

He said that while there was no evidence that changing technology was destroying more jobs than it was creating, policy makers needed to anticipate the social effects of its impact on the workforce, – including rising inequality.

“There are fears of technology destroying more jobs than it creates. At this point, those fears are misplaced,” he said.

“There are big changes in the way that technology is changing jobs at different skill levels. For much of the last 150 years technological change has been associated with an uplift of skills over time, but in the last decade or so, we are creating more jobs in net terms at the bottom as well as the top of the skill ladder, which has led to a hollowing out of mid-level skill jobs.”

He said that it was a concern that many of the threatened mid-skill jobs were quality jobs which occupy a large proportion of the workforce.

“There are consequences around that for inequality in particular. It raises the question of how we can transition people into growth areas of the economy because, as we saw in the 1980s, that can be very difficult to do without pain for individuals,” he said.

Advice for young people 

Asked for his advice for young people entering the workforce, Professor Gahan that it was becoming more important to think about the mix of skills they had and how to upgrade or transfer skills to keep up with technological change.

“Technology itself does not create or destroy jobs. Demand for jobs is derived from demand for goods and services, so you need to look at where demand for goods and services is growing to see where jobs are likely to grow,” he said.

“For example, people are looking at experiences and are prepared to pay a premium for them. There are also increases in demand in health and human services.

The other big thing is for young people, there are likely to be changes in their job so they need to be prepared to move from one area to another. We know that a lot of skills are transferable, so you need to think about how to repurpose what you do.

“There is some evidence that you need a ‘T-shaped’ skills profile. One where you have deep skills in one area of expertise (the downward line of the T) and where you have a broad range of general skills (the cross of the T) of different types that aren’t technical but soft skills of problem-solving and relationship skills.

Upskilling and continuous improvement were keys for those already in the workforce, with a focus on ensuring that skills were transferable, and that employees had the skills to negotiate change and transition.

What can policy makers do?

Professor Gahan said that policy managers needed to focus their advice to government on the way these changes in the nature of work were interacting.

“Some of these are based on technology, but others are not. For example, the ageing of the workforce means it is not only becoming older, but more age diverse.

He said this delivered advantages – such as the potential to leverage different skills and diverse knowledge – but could create clashes around intergenerational conflict and different ways of working.

He said that there were changing social attitudes around the roles of men and women, and what people expected from work. 

“Policy makers will need to look more holistically and draw lines between these apparently disparate dots, he said.

“They need to look at how these changes impact what organisations do, how organisations themselves are changing, and try to see ways in which these developments can be leveraged to get good outcomes for the economy.

“There will also be losers from these processes, and they need to identify who they are and how we can protect them so that we reduce social dislocation from these changes.”

While there were strong forces shaping the future of work, policy makers could still be able to control the shape of the labor market through regulation and other forms of intervention.

These included resolving issues around the fragmentation of the labour market, balance flexibility and protection for workers, and rethinking standards for growing numbers of non-standard workers.

Find our more about ANZSOG’s Thought Leadership events at the ANZSOG website