A101 Team Separating fact from fiction when it comes to the future of work.
In December 2017, the McKinsey Global Institute released a report on the future of automation. In it, they reveal that by 2030, “about half of all work activities globally have the technical potential to be automated by adapting currently demonstrated technologies.” In other words, we currently have the technology that could make half of the work being carried out worldwide obsolete in a little over ten years. What does that mean for the future of work?
For one, just because a task can be automated doesn’t mean that all humans doing that work will be replaced. As Economist James Bessen pointed out in an oft-cited case study, when ATMs were introduced 45 years ago, society sounded the death knell for bank tellers.
But rather than slowly kill the profession with the arrival of over 400,000 ATMs, the number of tellers has actually risen because the ATM led to cost savings that allowed banks to open additional branches. Similarly, Uber predicts that with the rise of automated vehicles, the demand for drivers will actually increase for much the same reason. Automated vehicles will drive down the cost of an Uber ride, thereby driving up demand. Although it’s hard to predict the impact of automated technologies that are not currently widespread, warnings of economic apocalypse are probably exaggerated.
That said, definite changes lay ahead for the American economy. The most easy to predict changes are the those involving shifts in demand for workers between industries. While some industries will be easier to automate in part or whole, other industries will still require or be better handled by a person. For example, while jobs like manufacturing, data processing, and food preparation are easily automatable because they are highly repetitive and predictable, industries that are reliant on interpersonal skills, emotional intelligence, and creativity such as teaching, health care, and entertainment will be more difficult to replace.
It’s also highly likely that automated technologies will replace certain aspects of particular jobs, requiring employees to work in tandem with, or operate new technologies. The McKinsey study itself says that while 50% of work tasks will be automatable by 2030, only 5% of occupations can be completely automated. In fact, James Bessen noted in his study that over the course of the past 60 years, automation has only made a single occupation obsolete – that of elevator operator. Automation has otherwise been integrated into the fabric of work life. This trend is likely to continue, making certain mundane aspects of jobs automated while human beings continue to carry out the more complex activities associated with work, including programming and operating new technologies.
Taken together, what does this mean? While it means that the economy as we know it isn’t meeting its end, there will be substantial changes ahead, and we need to prepare our future workforce to prevent major disruptions in the economy or long spells of unemployment for large swaths of the population.
The economy of the coming decades will require individuals who can think and adapt. It will require continuous learning to update knowledge and skills so individuals will be able to step into new jobs and industries with ease. It means that as a nation we need to rethink postsecondary education because a model in which students receive all their training in their twenties and then never learn new concepts or ideas won’t sustain lifelong careers. Ongoing education and training must become the norm – it must be affordable and provide enough flexibility to fit into a busy adult’s life. In short, the profound changes ahead for our economy will require profound changes in the way we prepare our workforce and educate the next generation of workers.
