Not for our grandchildren – the workplace of the future
The future workplace
In the 1930’s John Maynard Keynes, one of the greatest economists of our time, wrote an essay titled the “Economic Possibilities for our Grandchildren”.
Keynes envisaged a future where the working class will have reached a point where absolute needs are met allowing more time for leisurely pursuits and less time for work. Keynes utopia is closer to reality than we think, but not because our absolute needs are met but because the rise of robotics and artificial intelligence (AI) is about to trigger the biggest change to the workplace in this era by displacing human jobs.
How do we ensure a future for our grandchildren?
Many leading institutions have made the following predictions about robotics / AI: one-fifth of the global workforce will be impacted by robotics / AI*, 15 million British jobs could be automated by robotics / AI**, and the successful application of AI can increase profitability by 38% by 2035***. So how do we adapt and change to secure the future workplace for our grandchildren.
At a micro level:
- Reskill the current workforce / increase technical competence – Barclays research suggest that 63% of jobs now require basic digital skills. With this trend continuing, there will be more tech informed roles and greater competition for technical skills and competence. Education must focus increasingly on STEM subjects and companies have to reskill their staff for the new technical era. Without these skills you won’t have the permission to play.
- Improve lifelong learning – with decreasing pension pots, increasing retirement age, and improved healthcare, we have an ageing demographic in the workforce. This is an under developed talent pool and most firms are bad at retraining the older generation. We must find ways to better provide retraining and create a workforce able to constantly learn and adapt.
- Promote differentiated leadership styles – leadership in the future will be focused on soft skills to be successful. How to inspire, encourage, create enthusiasm, unlock innovation. How to integrate machines with humans. The leader of tomorrow must be open to trying new things while allowing for failure without recriminations.
- Increase creative, critical and design thinking – we must decrease prescriptive education and increase the level of creative, critical and design thinking. Design and creative classes have decreased by 17% in UK schools in the last ten years. We must reverse this trend.
At a macro level, the idea to mitigate the negative externality of robots and AI is to implement a robot tax or universal basic income (UBI). Many governments and business leaders, including Bill Gates, Elon Musk and Richard Branson, believe these ideas are required to absorb any economic shocks through rapid automation. Although taxation is an interesting idea, I don’t think it will ever happen as it will be too difficult to implement. Do you tax based on the number of robots installed, the profit a firm makes through robots, or the loss of human labour in the workforce? A UBI is more viable and countries such as Finland and Germany are trialling the scheme. UBI has the advantage of eliminating households in poverty and potentially allow people to be more creative in taking risks in business and entrepreneurship. Again, I don’t think a UBI will happen as I don’t see how governments could afford funding of UBI in perpetuity (we already have a pension deficit to contend with).
New sectors, jobs, and roles
In conclusion, I personally do not believe in a complete AI Armageddon. Although the 4th industrial revolution is taking place, the pace and scale of change is not fast enough that new sectors cannot absorb them and new jobs and roles can be created. It will be a case of man complementing machine and a liquid workforce that is adaptable and responsive to temper social disruption. We may not be following Keynes exact vision where increased economic output means we spend more time on leisurely pursuits but by understanding and acting on the issues and changes required now, we can ensure a brighter future for our grandchildren.
**Andy Haldane, Chief Economist for the Bank of England