International Organisation for Knowledge Economy and Enterprise Development
IKED - International Organisation for Knowledge Economy and Enterprise Development


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..:: Addressing technology and jobs

One of the most critical issues of our time has to do with the relationship between technology and jobs. It is well-known since decades that technology is critically important for productivity growth and competitiveness, which in turn leads to more jobs. Already Keynes (1930), Leontief (1952) and other leading economists predicted, however, that technology would ultimately replace jobs on a massive scale, reaching a magnitude that would lead to many people being laid off for good and the working day being reduced to a few hours at best. With the digital revolution, the traditional view that technology is good for jobs initially prevailed. More recently however, even the World Economic Forum, the OECD, and many academic researchers, have begun to argue that the impact of technology is now taking on a new shape.

What is then the path ahead? There is no way for us to refute taking advantage of technical progress, retreat and walk backwards. With less technical advance, there will be a loss of competitiveness, industries will be wiped out and there will be less resources to support society.

Having said that, it is not a given what technical progress is desirable, nor its consequences acceptable. In what respects automation and artificial intelligence are to replace human beings is not just a matter of business and economic pay-off. We now need to pass judgement what society we are to live in, and what future "social contract" we, as citizens and human beings, are going to live with. These issues cannot just be left hanging in the air as machines start acquiring consciousness. Just as in the case of authentication, authorisation, privacy and accountability, the playing rules are not a given.

So, "who" is to take the lead in all of this? Is it "government", as we often presume, which should assume responsibility? Which governments will then take the lead, individually or collectively, in the era of rising populism, Brexit, Trump, and hardening authoritarian tendencies in many corners?

How to manage technology is, in part, connected with our ability to handle globalisation. The rapidly enhanced cross-border flows of goods, services, investments and not least immigration, whether workers or refugees, have become a favorite scapegoat for the destruction of jobs, particularly in stagnant regions and among "middle-class" workers, and an associated rise in income differences. Studies that weigh in the effects of both globalisation and technical progress typically conclude that the latter has had a much greater impact on the labour market in most countries, including on the destruction of certain kinds of jobs and the declining demand for some kinds of competencies, and what associated impacts there have been on employment and relative wages.

Many are struggling to come to grips with the way technology, the economy and politics have co-evolved in the past years. This includes the unions which have been used to adopting a defensive stance by defending conditions as they stand today, with limited consideration what change to embrace and what to resist.

Against this backdrop, a leading Swedish union, "Unionen", initiated a project to review the relations between technology, productivity, and jobs. Starting in 2014, this work initiated mapping and analysis to review how the relationship between productivity and jobs has been changing in recent years as well as across diverse economic activities, under the influence of "digitalisation" and "automation".

The final report, produced under the responsibility of Prof. Thomas Andersson, Chairman of IKED, confirms that many jobs are on the way out, as a consequence of technical progress. It is true that others are being created but there will be growing pressure for speedy adaptation by way of re-skilling, resource allocation and the rise of new business activities. Managing this transition will not be "business as usual". Contemporary society is simply not equipped to manage a situation with requirements of such vast and swift reorganization, and to cope with the economic, ethical and social issues that arise in the process. Coming up with the appropriate answers is not merely a question of government policy but multiple stakeholders, including the industrial partners and civil society, need to engage constructively in this agenda.

Some of the challenges set to intensify ahead have to do with the overriding frameworks, e.g. with regard to the organisation of working life versus education & competence development, as well as with regulations and taxes. Others have to do with processes that are highly context-specific, thus requiring the ability to tailor solutions to varying local conditions. Unions have an important role to play in paving the way for improvement in both respects, given their critical link to the work force and unique reach to conditions on the ground. This applies in Sweden as well as more broadly in most other European countries.

For the final report of the project (in Swedish), published in September 2017, see …. Based on an earlier draft, a policy panel organised by Unionen in Almedalen, Visby, on July 5th, 2017, took stock of the situation and reflected on the implications for policy-making more generally and for the unions specifically. In a follow-up webinar in Almedalen on July 4th 2018, another round of discussions hosted by Unionen reviewed “what skills are lacking as our societies are entering the next phase of modernisation”.

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