The future of work is already here
Artificial intelligence, machine automation, and more: Humanity continues to be transformed by a period of unparalleled technological advancement. The next few decades are set to present both significant challenges and opportunities as the way we live, work, and relate to one another is fundamentally changed.
A new chapter in human development enabled by the extraordinary advances equivalent to those seen in the first, second, and third industrial revolutions, we’re seeing more and more lines blurred as technological advancement merges our physical, digital, and biological worlds—giving rise to both great opportunity and potential peril. This is known as the Fourth Industrial Revolution.
What is meant by the Fourth Industrial Revolution?
The Fourth Industrial Revolution is the widespread and ongoing transformation of traditional industries and the emergence of new technologies that are changing the way we live and work.
Although it builds upon the Third Industrial Revolution, which was characterized by the digital revolution and the widespread adoption of electronics and information technology, it has been widely accepted as not just a prolongation of the Third Industrial Revolution but rather a Fourth and distinct one in its own right marked by several key technologies, including:
- Artificial intelligence: These technologies enable machines to perform tasks that typically require human intelligence, such as decision-making, problem-solving, and pattern recognition.
- Internet of Things (IoT): IoT refers to the network of physical devices, vehicles, appliances, and other objects embedded with sensors, software, and connectivity, allowing them to collect and exchange data.
- Robotics and automation: Advances in robotics are leading to more autonomous machines that can perform tasks in various industries, from manufacturing and logistics to healthcare and agriculture.
- Blockchain: Created for cryptocurrencies like Bitcoin, blockchain is a decentralized digital ledger that securely records transactions across multiple computers. It has applications beyond finance, such as supply chain management, voting systems, and digital identity verification.
- Biotechnology: These fields involve manipulating biological systems at the molecular and cellular levels, leading to breakthroughs in medicine, agriculture, materials science, and environmental sustainability.
The future of work
One of the most immediate and impactful outcomes of the Fourth Industrial Revolution and digital transformation in general is automation. Every day, more manual processes are becoming automated, and as technology continues to accelerate, so will automation.
This is backed up by statistics—some of them quite alarming. The U.S. business process automation market grew to US$8 billion in 2020 against the backdrop of the global pandemic, and this number is expected to rise to US$19.6 billion by 2026. Meanwhile, 80% of businesses are speeding up process automation, while 50% plan to automate all repetitive tasks.
This is having a profound impact on the labor market. According to McKinsey, one in 16 workers may have to switch occupations by 2030 across eight major economies. That’s more than 100 million people. As for those who remain in their existing occupations, 40% will need to reskill in the next three years due to the impact of AI alone. In the long term, these figures grow exponentially.
Faced with the scale of the unstoppable shifts in workforce demands, the L&D function and wider organizational leadership must be prepared to address the challenges associated with workforce transformation. This begins by taking an in-depth look at its impact on the world of work, where there are four key impact areas:
1. Technological
Advancements in artificial intelligence are putting a great deal of pressure on industries to automate processes and remain competitive. McKinsey estimates that up to 800 million individuals may be displaced by automation by 2030. Increased global competitiveness will also accelerate cost pressure, which will lead to substantial downsizing or reassignment of a large contingent of workers.
These factors will require organizations to have a solid understanding of the way these technologies impact not just their operations but also the wider industry, and how they can ensure organizational agility to adapt to these changes.
2. Economic
Four factors of production fuel economic growth: land, labor, capital, and enterprise. Today, the world is attaining only 52% of its entrepreneurial capacity, and this number is declining year over year.
Large, established enterprises have a significant advantage in the future of work over smaller companies due to their ability to adapt to technological changes. However, this is not a recipe for long-term, sustainable economic success. The world must focus on supporting independent entrepreneurs, as small and midsize businesses are the fuel of most economies of the world today.
3. Social and societal
The coronavirus pandemic showed us how much of an impact technology has on social and societal values, and how much of an influence it has on the concept of work.
Freelancers, for example, now comprise 38% of the U.S. workforce as professionals of all ages seek flexible work models, and this figure is expected to grow to 50% before 2030 as emerging Gen Z and Gen Alpha workforces, with different values, ethics, and more digital fluency, prioritize purpose-driven environments, flexibility, and work-life balance over loyalty to a particular company or employer—to them, a job is just a job. This is something all organizations must adapt to.
4. Education and training
Individuals' ability to access employment training is important for economic development. While traditional degrees have historically been seen as the pathway to long-term fruitful employment, today’s students are less interested in rigid curriculums and are instead keener to take shorter, skills-based training that is more relevant to today's workplace.
In response, employers should focus on the skills required to achieve their business objectives and remain competitive and agile, which requires them to ensure their employees have the necessary training to fill these skills gaps. Workers, naturally, need to acquire skills “on demand” and be prepared to go through reskilling and upskilling processes to adapt to their changing roles and responsibilities as digital transformation reinvents what it means to work.
Preparing for the future of work
Rapid technological advancements require organizations to be agile and adaptable. The Fourth Industrial Revolution is providing endless opportunities for employers who are prepared to equip their employees with new skills.
By being committed to teaching their employees new skills, employers can foster a mindset of continuous learning and experimentation, leading to innovative solutions and competitive advantages in the market.
At the same time, collaborations among the private sector, academia, and policymakers will be essential to navigate the future of work as we go through these profound moments.
Schools need to work with businesses and the public sector to develop on-demand, relevant, adaptable curriculums and focus on teaching skills; governments need to utilize advanced technologies to generate real-time and predictive insights on the labor market; and organizations need to hire for competencies over credentials and, more importantly, take the lead in supporting existing workforces’ reskilling and lifelong learning.
Want to find out how SkyHive skills intelligence can help support your reskilling efforts? Read our report produced in partnership with Forrester: AI Powered Skills Intelligence Is Now A Necessity, Not A Luxury
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