The Future Of Jobs: There Ain’t One. The Only Certainty Is Work-preneurship

Will any government anywhere in the globe be able to deliver good quality jobs in future? America will elect Donald Trump or Hillary Clinton based on who they think will help create more jobs, and both are promising some measure of protectionism. If they create jobs in America, it will be at the cost of jobs elsewhere.

Fortress Europe has never been as open a market as the US, but the rising tide of opinion against immigration shows that building walls may be uppermost in politicians’ minds. They may save a few jobs inside the Fortress, but reduce opportunities elsewhere. But since this is a game many can play, we will see a global shrinkage of jobs within national boundaries, rather than a secular expansion.

In India, Narendra Modi’s re-election prospects in 2019 depend largely on his ability to create jobs in a national economy which pushes 12 million people into the workforce annually – that’s one million workers seeking employment of some kind every month. The government has talked of skill-building, but the nature of work available is changing even faster with more and more low-skilled jobs getting automated. Entire ranges of low- or semi-skilled jobs are about to vanish sectors ranging from construction, real estate, banking, domestic work, chauffeuring, etc.

The problem is that the world isn’t what it used to be anymore. Dramatic and constant changes in technology and automation have shrunk the possibility of work creation in sector after sector, and even as global GDP and profits rise in the aggregate, the number of jobs created per billion dollars of output is falling.

The Economic Times (29 April) informs us that even software services – a prolific performer on high quality job creation till recently – is now going to grow jobs more slowly than before. Reason: in six years, the number of people required to produce $1 billion of export revenue has fallen by half. And even the jobs the industry does create will go to ever more high-skilled workers. Those freshly-minted engineers straight from college will be less and less in demand.

The IT industry’s old business model based on labour arbitrage – using lower cost engineers from India to do coding offshore rather than in the US – is under pressure. Lower skill jobs are being automated, and higher skill jobs offer huge salaries to the few who have the knowledge and experience for it.

Says the United Nations Development Programme’s 2015 Human Development Report (HDR 2015): “The digital revolution has created new opportunities, but has also given rise to new challenges, such as irregular contracts and short-term work, which are asymmetrically distributed between highly skilled and unskilled workers.”

The report adds: “(The) technological revolution presents skill-biased technical change: the idea that the net effect of new technologies reduces demand for less skilled workers while increasing demand for highly skilled ones. By definition, such change favours people with higher human capital, polarising work opportunities.”

This change is not just about IT services. It pervades all sectors, and manufacturing could be the worst victim of this dramatic powershift brought about by higher automation, as we argued in this Swarajya article.

The problem is not that there are no new jobs being created, but those jobs will not be like anything created in the past – secure and predictable. Jobs will be created opportunistically, and destroyed equally opportunistically, with little fanfare based on current demand. Says the HDR 2015: “In the new world of work, workers need to be more flexible and adaptable - and be ready to retrain, relocate and renegotiate working conditions. They also need to dedicate more time to searching for new opportunities.”

In short, keep learning, keep looking for work.

In this asymmetric world, many professions and institutions have to change – and change dramatically. These are some of the implications, as far as one can foresee.

#1: Companies need to become permanent teaching enterprises as much as producing entities. If skillsets and requirements need to change every few years due to changes in automation and technological developments, it is unlikely that regular universities, even specialised ones, can produce the kind of skills needed for the future quickly. A small curriculum change at any university takes years to implement. Companies which are closest to the market and technology will thus have to do the job themselves; they have to take up the challenge on reskilling their own staff or freshers.

Let’s illustrate this with an example. If much of the entry-level Java coding can be automated, a software company needs older, more skilled people to do things like working on artificial intelligence or machine languages, as the ET report notes. These workers will cost a bomb. It thus would make sense to upskill mid-career people at some point rather than always importing costly talent from a limited pool of experts. This can be done if companies themselves take up the job of reskilling, or enable teaching institutions to prepare short-term courses to train their own staff.

Or take the more mundane world of automobiles. As robots take over most of the jobs on the factory floor (welding, painting, assembly, and testing), fewer jobs will remain inside the company. More will be created outside: in dealerships, repair shops, sales, etc. This is training that the company will be best equipped to do, as the internal technology in cars may itself have changed. The ITIs themselves may need a rework of curriculum.

#2: The duration and content of schooling and higher education will need to change. Students will need to vocationalise towards the end of school, and even after school, training may need to follow jobs rather than continue for another five to seven years to earn technical qualifications. If knowledge is going to change at a fast pace, one cannot presume that learning before a job has to continue for nearly 17-20 years, from age four to 24-25, when you may get a professional qualification. It would be far simpler and cheaper for an Infosys to hire a coder after class 12, put him on the job, and then retrain him after four years, if skillset requirements have changed.

Continuous vocationalisation and reskilling will be the name of the game, not a continuous stretch of study, and then a continuous stretch of job till age 60. Schools and colleges and institutions of higher learning have to be constantly reworking curricula, and offering a mix of both short- and long-term courses in close association with businesses and social entrepreneurs.

Put simply, generalised schooling can end at Class 10, and the plus two stage can be about vocationalisation. After that, a job, and periodic reskilling after every three to five years, when they can come back to college.

#3: The business of government will also have to change. In theory, government jobs are the only ones that will remain stable, but in practice, when most normal functions can be automated or digitised, employing a whole army of office-bound babus and employees may be counter-productive. Government will have to depend on expertise outside, and its employees will need constant reintroductions to the world outside, including the technology that is upending all businesses, including the business of government. When governments focus on enablement rather than just administration, they need flexible mindsets, not inflexible rules and norms.

Also, it will have to build a huge, constantly updating database of information on where the jobs are being created, where they are disappearing, where one can upskill or reskill, and where to find help.

#4: Economists will have to reskill themselves. Macroeconomics is one field ripe for change, as the current system of forecasting is hopelessly out of date. Economists live in an analogue world, while the real world has become digital, virtual. Economies and economic players are part of a “complex adaptive system” and the future is no longer predictable with quarterly GDP data that look backwards rather than forwards. What we need to know is the direction of change, and this means new technologies like big data may need to be used in macroeconomic data gathering and analysis. Maybe, we even need more microeconomists – people who will tell you what could happen to you or your firm’s fortunes given a change in the environment – rather than macroeconomists who can’t get any forecast right. We need to know where demand will surface (or disappear) if the economy grows at 2.5 percent rather than 4.5 percent, for one can do little with just broad aggregates.

#5: The world will need more and more specialists, and very few generalists. Take the field of healthcare. You may need differentiated doctors, and not general physicians. You may need healthcare workers who can diagnose simple ailments, and prescribe treatments, and who don’t need to do an MBBS for five-and-a-half years. For more complicated ailments, you need specialists. With more knowledge becoming online, one can become a full-fledged doctor in stages – while practising. Also there is this reality: the average patient who is willing to surf the net, will be almost as knowledgeable as the average doctor when the former comes to his clinic. An empowered patient needs an even more knowledgeable doctor than before, especially when medical knowledge is expanding so fast.

It is waste of time trying to acquire all medical knowledge in one academic burst of six years, when the knowledge accumulated during that period will make what is taught in medical school partially redundant. And let’s not forget: it is only a matter of time before a robot can diagnose what a GP can do now.

#6: The world is going to be more unequal in future than it is now, with the rate of accumulation of skills determining the winners from the losers. The social stabilities achieved in the post-World War years will be under threat. One can’t rule out the rise of more religious antagonisms and extremism, for what people crave is certainty in a world that is increasingly unstable and unpredictable.

The HDR 2015 sums it up best: “Now is the time to be a worker with special skills and the right education, because these people can use technology to create and capture value. But there has never been a worse time to be a worker with only ordinary skills and abilities, because computers, robots and other digital technologies are acquiring these skills and abilities at an extraordinary speed.”

Your takeout: Jobs ain’t what they used to be. The future of jobs is brief periods of work, regular upskilling, and a constant search for work. You have to become a work-preneur.