19.1 Technological change and its impact on work and social protection
4 min read•july 31, 2024
Technological change is reshaping work and social protection. and AI are transforming industries, leading to job losses and new employment models. Traditional social systems struggle to address these shifts, sparking debates on and .
Emerging trends include , , and emphasis on . New social protection concepts like and are being explored. Policymakers are considering universal basic income, , and labor market reforms to address challenges.
Automation's Impact on Employment
Technological Unemployment and Job Transformation
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Top images from around the web for Technological Unemployment and Job Transformation
Managing the risks and opportunities of job automation View original
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Job Polarization in the 2000s? | CEPR Blog | CEPR View original
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Job polarization and workers’ response to the decline in middle-skill jobs - The Journalist's ... View original
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Managing the risks and opportunities of job automation View original
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Automation and (AI) transform industries leading to significant changes in job nature and availability
Technological unemployment describes job losses caused by technological change particularly human labor replacement with machines or AI systems
Job categories involving routine, repetitive tasks face higher automation risk while complex problem-solving, creativity, and emotional intelligence jobs remain less susceptible
and emerge as new employment models offering flexibility but often lacking traditional job security and benefits (Uber, TaskRabbit)
occurs in the labor market increasing demand for high-skilled and low-skilled workers while middle-skilled jobs decline
Technological change outpaces many workers' ability to adapt causing skills mismatches and potential long-term unemployment for some workforce segments
Automation and AI eliminate jobs but also create new ones with net employment effect and job distribution across sectors and skill levels remaining debated
Emerging Employment Trends
New job categories emerge in response to technological advancements (data scientists, AI ethicists)
Remote work becomes more prevalent enabled by digital technologies and changing work culture
Increased emphasis on soft skills and emotional intelligence in the workplace to complement AI capabilities
Rise of hybrid jobs combining multiple skill sets (marketing technologist, user experience designer)
Growing importance of across all job sectors and levels
Shift towards and short-term contracts in many industries
Automation of managerial tasks leading to flatter organizational structures
Social Protection for Technological Unemployment
Inadequacies of Traditional Systems
Traditional social protection systems designed for stable, long-term employment clash with current work reality
Unemployment insurance systems inadequately address long-term technological unemployment or gig economy workers' needs
combines labor market flexibility with strong social security explored as potential model for adapting social protection to new work forms
Existing skills training and retraining programs insufficiently keep pace with rapid changes in technology and job requirements
across jobs and employment statuses grows increasingly important as workers change jobs more frequently or engage in multiple work forms simultaneously
Social protection systems funding mechanisms often based on payroll taxes need reconsideration due to changing employment patterns and non-traditional work arrangements rise
Pension systems adequacy challenged by longer life expectancies, changing work patterns, and potential labor force reductions due to automation
Portable benefits systems allow workers to accumulate and transfer benefits across multiple employers or gig economy platforms
Skills insurance programs protect workers against skill obsolescence by funding retraining and upskilling
schemes provide a safety net while maintaining work incentives
finance social programs with private investment repaid based on achieved outcomes
systems allow individuals to exchange services based on time rather than money
Policy Responses to Technological Change
Universal Basic Income and Alternatives
Universal Basic Income (UBI) provides all citizens with regular, unconditional sum of money regardless of employment status
UBI proponents argue it provides safety net for technology-displaced workers supports entrepreneurship and reduces inequality while critics raise work disincentive and funding challenge concerns
(NIT) offers income support phasing out as earned income increases potentially addressing some UBI criticisms
or personal training accounts support continuous skill development and adaptation to technological changes
Job guarantees explore government as employer of last resort as potential technological unemployment response
Policies supporting new industry development and job creation in emerging sectors help offset automated industry job losses
Work Redistribution and Labor Market Policies
or work-sharing arrangements distribute available work more evenly across the population
(robot taxes, capital gains tax changes) debated as means to fund social protection systems and potentially slow automation pace
Strengthening and exploring new worker representation forms (gig economy workers) help ensure more equitable technological progress benefits sharing
expansion bridges skills gaps and facilitates smoother transitions into new industries
encourage innovation and job creation in response to technological disruption
improvement helps workers and policymakers better understand and respond to changing job market dynamics