Work as we know it or as we have traditionally known it is undergoing a sea change. The classic definitions of workplace, employee and projects no longer make sense. We are rapidly evolving towards a society where person-as-a-service is a reality and hence multi-tasking and location independent work are the norm. All this is being driven by a major force, the digital revolution and the online mode of being present. So what are the challenges that the job market and the education system are facing as a result?
Education systems are woefully out of date and definitely have not kept pace with the changing nature of work, resulting in many employers saying they cannot find enough workers with the skills they need. In a McKinsey survey of young people and employers in nine countries, 40 percent of employers said lack of skills was the main reason for entry-level job vacancies. Sixty percent said that new graduates were not adequately prepared for the world of work.
There were gaps in technical skills and also in important soft skills such as communication, team work, and punctuality. Conversely, even those with jobs may not be realizing their potential. In a recent global survey of job seekers conducted by LinkedIn, 37 percent of respondents said their current job does not fully utilize their skills or provide enough challenge.
Almost 75 million youth are officially unemployed. Women represent one of the largest pools of untapped labor: globally, 655 million fewer women are economically active than men. In a “best-in-region” scenario in which all countries match the rate of improvement in gender gaps (in labor force participation, hours worked, and sector mix of employment) of the best-performing country in their region, $12 trillion more of annual GDP would be realized in 2025, equivalent in size to the current GDP of Japan, Germany, and the United Kingdom combined.
Some of the mismatching is location based: in places where there is demand for work, it does not always match the skill sets of the available and qualified workers there. This geographic mismatch can be seen across regions within countries, and between countries. This is a very big worry if you look at it as an enterprise.
The disruption to the world of work that digital technologies are likely to entail could pose significant challenges to both policy makers and business leaders, as well as workers. So, what can be done by all the three stakeholders to help the system get around this climbing of a steep digital hill? We looked at a McKinsey Report about Technology, Jobs and The Future of work and here is what the report suggests as remedial measures.
- Evolve education systems for a changed workplace. Policy makers working with education providers (traditional and non-traditional) could do more to improve basic STEM skills through the school systems, and put a new emphasis on creativity as well as critical and systems thinking.
- A role for the private sector to drive training. Companies could face gaps in skills they need in a more technology-enabled workplace, and would benefit from playing a more active role in education and training, including providing better information about needs to learners and the education ecosystem.
- Create incentives for private-sector investment to treat human capital like other capital. Through tax benefits and other incentives, policy makers can encourage companies to invest in human capital.
- Public-private partnerships to stimulate investment in enabling infrastructure. The lack of digital infrastructure is holding back the digital benefits for some emerging economies; public-private partnerships could help address market failures.
- Rethink incomes. If automation (full or partial) does result in a significant reduction in employment and/ or greater pressure on wages, some ideas such as universal basic income, conditional transfers, and adapted social safety nets could be considered and tested.
- Rethink safety nets. As work evolves at higher rates of change between sectors, locations, activities, and skill requirements, many workers will need assistance adjusting. Many best practice approaches to safety nets are available, and should be adopted and adapted, and new approaches considered and tested.
- Embrace technology-enabled solutions for the labor market that improve matching and access and bridge the skills gaps. Policy makers will need to address issues such as benefits and variability that these digital platforms can raise.
- Accelerate the creation of jobs in general through stimulating investment and creation in businesses, and accelerate creation of digital jobs in particular, and digitally-enabled opportunities to earn income, including through new forms of entrepreneurship.
- Innovate how humans work alongside machines. Greater interaction will raise productivity, but require different and often higher skills, new technology interfaces, different wage models in some cases, and different types of investments by businesses and workers to acquire skills.
- Capture the productivity benefits of technology to create the economic growth, surpluses, and demand for work that create room for creative solutions and ultimately benefit all.
Will these measures effectively address the digital challenge? Tough to say as the digital chasm is a growing on and at best a moving target, but what they represent is a good starting point that will definitely help bridge the width of the chasm and solve employment, skilling and education gaps that are creating unemployment across counties now
