Tech Impact on Jobs

Technology has been a game-changer in many industries, bringing about a variety of benefits for society such as increased efficiency, improved communication, and access to information. The rise of technology in the workforce is not a new phenomenon, but it has accelerated in recent years and it revolutionized the way we live and work. Automation, artificial intelligence, and machine learning have all profoundly changed the way we do work in the modern world. This has led to a shift in the types of jobs that are in demand, as well as the skills required for those jobs. However, it has also sparked a significant concern - the displacement of jobs. According to a report published by the World Economic Forum, 2018, the use of technology is rapidly replacing jobs at an unprecedented rate. The impact of technology on jobs has led to a number of concerns, such as unemployment, income inequality, and changes in the skills required for different types of work. Those who are able to adapt to the changing nature of work and acquire new skills are more likely to find employment and earn higher wages. On the other hand, those who are unable to adapt are more likely to be left behind, leading to a widening gap between the haves and the have-nots.

In this blog post, we will take a closer look at the role that technology plays in the job market, the concerns that it raises, and the potential benefits it can bring. Moreover, we are going to examine potential solutions for mitigating the negative effects of job displacement, such as programs aimed at reskilling and retraining workers. The aim of this blog post is to provide an understanding of the current and future impact of technology on jobs. It also provides insights into how individuals and organizations can adapt to the changing nature of work.

😲 "The robots are coming, and they're going to change everything. But if we're smart, they'll change everything for the better." - Andrew McAfee

Automation and Job Displacement

Over the past decade, a set of ground-breaking, emerging technologies have signalled the start of the Fourth Industrial Revolution. As the world of technology continues to evolve at a rapid pace, one thing is becoming increasingly clear: automation is changing the way we work. From self-driving cars to automated machines, machines are now capable of performing tasks that were once done by human hands. This technological revolution has led to a shift in the job market, with industries such as manufacturing, transportation, and retail experiencing the most significant changes. The rise of self-driving cars and automated machines is replacing jobs like truck drivers and factory workers, leaving many to wonder about the future of work.

Up until 2025, about 15% of a company's workforce is at risk of disruption, and 6% of workers will be fully displaced, as per the Future of Jobs Survey. According to a study by McKinsey, as many as 800 million jobs could be displaced by automation by 2030. This is a staggering number and one that has led to concerns about unemployment and income inequality. In regions like Africa where low-skilled jobs such as agriculture and manufacturing make up a large portion of the workforce, the impact of automation on employment and income could be significant.

But it's not all doom and gloom. As they say, every dark cloud has a silver lining.  Automation is a double-edged sword that holds both opportunities and challenges. It can lead to the creation of new industries and services that we cannot yet imagine. It can also free up human workers from performing repetitive, dangerous and tedious tasks, allowing them to focus on more creative and higher-skilled jobs. It is important that we proactively address the challenges that come with automation, such as job displacement and income inequality. It is therefore vital that we approach this technological shift with an open mind and a proactive attitude to ensure that everybody benefits from it in the long run.

Digitization

Another impact of technology on jobs has been the digitization of many industries. Digitization refers to the process of converting analog information into digital format. It has had a significant impact on many industries, including media, music, and publishing. The rise of digital technology has led to the displacement of jobs in these industries as traditional business models have been disrupted. As technology continues to digitize many industries, it is expected that more jobs will be displaced. In Africa, where digital infrastructure is still developing, the digitization of industries can be a double-edged sword, as it can lead to both job displacement and job creation, depending on the specific industry and the readiness of the workforce.

😟 "The digitization of the economy is the defining trend of our time. It has the power to create tremendous value, but also poses new risks and challenges." - Satya Nadella: CEO of Microsoft

One example of digitization leading to job displacement is in the media industry. With the rise of digital platforms such as social media and online news websites, traditional newspapers and magazines have been facing declining revenues and circulation. As a result, many newspapers have closed or downsized their operations, resulting in the displacement of jobs for journalists, editors, and other staff. For instance, The New York Times has been investing in digital news, as a result of this, it has been resulted in cutting back jobs in print production and distribution.

The banking and finance industry has been heavily impacted by digitization, with the rise of online banking and algorithmic trading. The increasing use of online banking platforms has led to the displacement of jobs for bank tellers and other front-line staff. As more customers are using online banking to check their balances, make transfers and pay bills, the need for tellers in branches has decreased. Additionally, the increasing use of algorithmic trading has led to the displacement of jobs for stockbrokers and other traders. Algorithmic trading systems are able to execute trades faster and more efficiently than human traders, leading to a reduction in the need for human labor. The digitization of the banking and finance industry has also led to an increased focus on cybersecurity, as online banking and trading platforms are vulnerable to cyber-attacks. This has led to the creation of new jobs in the areas of cybersecurity and data analysis. Additionally, the increasing use of data analytics in the banking and finance industry has led to the creation of new jobs in areas such as risk management and fraud detection.

Another example of digitization leading to job displacement is in the music industry. The rise of streaming services such as Spotify and Apple Music has led to a decline in sales of physical records and CDs. This has resulted in the displacement of jobs for music retailers and record store employees. In addition, the shift towards streaming has also led to a decline in revenue for musicians, as streaming royalties are typically lower than royalties from album sales.

In the publishing industry, digitization has led to the displacement of jobs as e-books and online platforms have become more popular. The rise of e-books has led to a decline in sales of physical books, resulting in the closure of many bookstores and the displacement of jobs for booksellers. Additionally, the shift towards online platforms has led to a decline in revenue for publishers and authors, as e-book prices are typically lower than physical book prices.

Overall, the digitization of many industries has led to job displacement as traditional business models have been disrupted. The shift towards digital platforms and e-commerce has led to a decline in revenue for many companies, resulting in the closure of brick-and-mortar businesses and the displacement of jobs. However, digitization has also led to the creation of new jobs in areas such as e-commerce and digital marketing.

Impact of Job Displacement

Impact of Job Displacement on Specific Industries:

  • Manufacturing: The use of robots and automated machines in manufacturing has led to the displacement of jobs in this industry. However, new jobs have also been created in the areas of programming and maintenance of these machines. According to a Deloitte report, "The use of robots and automation in manufacturing has led to a reduction in labor costs and an increase in productivity" (Deloitte, 2020).
  • Transportation: Self-driving cars are expected to replace truck drivers and delivery drivers. However, new jobs will also be created in the areas of programming and regulation of these vehicles. According to a study by the National Employment Law Project, "Self-driving vehicles have the potential to create new jobs in areas such as data analysis and vehicle maintenance" (National Employment Law Project, 2019).
  • Retail: The use of automation in retail, such as self-checkout machines, has led to the displacement of jobs in this industry. However, new jobs have been created in the areas of e-commerce and data analysis. According to a report by McKinsey, "The use of automation in retail has led to an increase in efficiency and a reduction in labor costs" (McKinsey, 2020).
  • Healthcare: The use of technology in healthcare, such as telemedicine, electronic medical records and robotic surgery, can lead to the displacement of jobs in this industry. Additionally, technology has also led to the automation of certain tasks such as medical diagnoses, which can lead to more efficient and accurate treatment for patients. However, new jobs will also be created in the areas such as data analysis. In Africa, where the healthcare sector is still developing, the impact of automation on jobs can vary depending on the specific country and region.
  • Banking: The use of technology in banking, such as online banking and mobile payments, can lead to the displacement of jobs in this industry. Technology has also led to the automation of certain tasks such as risk assessment and fraud detection, which can ultimately lead to a more secure financial system. However, new jobs will also be created in the areas of business analysis and cybersecurity. In Africa, where the banking sector is still developing, the impact of automation on jobs can vary depending on the specific country and region.
  • Hospitality: The use of technology in the hospitality industry, such as online booking and automated check-in/check-out, has led to job displacement in traditional roles such as receptionists. However, it has also created new jobs in areas such as e-commerce and digital marketing, which can lead to a more efficient and cost-effective hospitality experience.
  • Education: The use of technology in education, such as online learning and educational software, has led to job displacement in traditional roles such as teachers and librarians. However, it has also created new jobs in areas such as e-learning design and digital content creation. Technology has also led to the automation of certain tasks such as grade calculation and classroom management, which can lead to a more efficient and personalized education experience.

Concerns

The displacement of jobs due to technology has led to many concerns, such as unemployment and income inequality. As jobs are replaced by technology, many workers are left without work, and they may struggle to find new employment. Additionally, as technology replaces jobs, it may lead to income inequality, as some workers may be able to adapt to the new technologies, while others may not. The loss of jobs also has a ripple effect on the economy, leading to decreased consumer spending and reduced economic growth. "The displacement of jobs due to technology has led to many concerns, such as unemployment and income inequality" (World Economic Forum, 2018). In Ethiopia, where the unemployment rate is already high and income inequality is a significant issue, the displacement of jobs due to technology can exacerbate these concerns" (Ethiopian Central Statistical Agency, 2020).

😟 "The rapid pace of technological change is creating uncertainty and concern about the future of jobs and the workforce." - Barack Obama: 44th President of the United States

Potential Solutions

  • One potential solution is to invest in reskilling and upskilling programs, to ensure that workers can adapt to the new technologies and take advantage of new job opportunities. This can include courses and certifications in areas such as programming, data analysis, and digital marketing. "Investing in reskilling and upskilling programs is essential to ensure that workers can adapt to the new technologies and take advantage of new job opportunities" (ILO, 2020).
  • Another solution is to focus on job creation in high-growth, high-demand areas, such as technology and healthcare. This can include policies and incentives for companies to invest in these areas, as well as government investment in research and development. "Focusing on job creation in high-growth, high-demand areas such as technology and healthcare can help mitigate the impact of job displacement" (World Economic Forum, 2018).
  • Another solution is to implement technologies such as artificial intelligence and machine learning to automate tasks and improve efficiency, rather than replacing jobs altogether. "Implementing technologies such as artificial intelligence and machine learning can improve efficiency and automate tasks without necessarily replacing jobs" (Forbes, 2020).

😟 "The key to addressing job displacement is to focus on the opportunities created by technology, not just the challenges." - Tony Robbins

Conclusion

Technology has brought about many benefits to society, but it has also led to the displacement of jobs. This trend is expected to continue, and it has raised many concerns about the future of work and the workforce. However, it is important to remember that technology can also create new jobs, and it is essential to adapt to the changes in the workforce to ensure that the benefits of technology are shared by all. Governments, employers, and workers must work together to ensure that the benefits of technology are shared by all, and that the displacement of jobs is minimized. Furthermore, it's crucial to invest in reskilling and upskilling programs, to ensure that workers can adapt to the new technologies, and take advantage of the new job opportunities. It's also crucial to address and mitigate the negative impacts of job displacement, such as unemployment and income inequality, to ensure that the benefits of technology are shared by all members of society. "Technology has brought about many benefits to society, but it has also led to the displacement of jobs. It is our responsibility to ensure that the benefits of technology are shared by all and that the negative impacts of job displacement are addressed" (World Economic Forum, 2018). Implementing technologies such as artificial intelligence, machine learning and deep learning can improve efficiency and automate tasks without necessarily replacing jobs altogether. It's important to be aware of the impact of technology on jobs, but also to recognize its potential benefits and to find ways to mitigate its negative effects.

References

 

Citation

Cited as:

kibrom, Haftu. (Jan 2023). Jobs in the Digital Era. Kb’s Blog. https://kibromhft.github.io/posts/2022-10-19-automation/.

Or

@article{kibrom2022ntk,
  title   = "Jobs in the Digital Era",
  author  = "kibrom, Haftu",
  journal = "Kb's Blog",
  year    = "2023",
  month   = "Jan",
  url     = "https://kibromhft.github.io/posts/2022-10-19-automation/"
}