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Sunday, 25 February

The Future of Work?

Innovations in digitisation, computing, artificial intelligence and robotics lie behind many wider transformations in the future of work according to the Future of Work Commission (FWC) - and we are already experiencing these transformations.

The FWC thinks that both the scope and pace of the current technological revolution are likely to be at least as great as any that has gone before.

To read the Report Executive Summary - Click Here

 

Extract from Executive Summary

Recent advances make it possible to automate a much greater range of tasks than those enabled by previous developments. This means that the current wave of automation will reach into sections of our economy that have traditionally been considered 'safe', including jobs which involve complex cognitive or analytic tasks. New technologies are increasingly capable and pervasive. The pace of technological advance has increased and the fusion of new technologies – in particular, recent developments in machine learning combined with the data explosion – may make change faster than before.

Our research suggests that the impacts and risks of technological change are not widely understood and workers and employees hold different views about the likelihood and pace of automation in particular spheres.

Automation will undoubtedly affect different sectors and regions in very different ways. Nevertheless, we have identified the following trends in the UK labour market:

  • Labour market polarisation, driven by the automation of routine tasks, is likely to reduce. Routine tasks have traditionally been more vulnerable to automation than non-routine ones, which do not follow rules that can be explicitly stated and followed. But as artificial intelligence develops, the automation of non-routine analytical tasks is likely to increase. Tasks that are less vulnerable to automation involve our most human qualities: creativity, care, teamwork, critical-thinking and imagination.
  • Without policy intervention, the power of the high-skilled over the low-skilled will increase further. Technological change is likely to both raise the productivity of high-skill workers and increase competition for low-skill jobs which are not susceptible to automation.
  • Low-skill workers, who make up 45 percent of the labour market, are particularly vulnerable. Without intervention, low skilled workers are at risk of a severe and sustained decline in their wages. Workers at risk of displacement need a new education and skills system which focuses on lifelong learning and offers extensive opportunities to retrain. The average working week is likely to reduce.
  • The average working week in the UK has fallen from about 50 hours per week in 1900 to just above 30 hours today. In the future, in spite of this year’s flat trend in average hours, we can expect average working hours to decline further. People who work fewer hours tend to be more productive; as working time increases, average output per hour decreases. We should aspire to a labour market which offers more leisure time, and still offers good work to everyone.
  • There is no substantive evidence that Britain is heading towards widespread technological unemployment, exaggeration is unhelpful. We need a more nuanced debate about the impact and potential of automation – one that recognises that technological change is already having social and economic effects. The main problem we face is not the number or availability of jobs but their productivity and quality. We must focus on how best to increase levels of human and capital investment, spread the benefits of technological innovation, and create good work.
  • New patterns of work have become more common. 'Atypical workers' – those not on standard employment contracts – now account for a significant proportion of the UK workforce, with 5 million self-employed workers, 900,000 workers on zero-hours contracts, and 800,000 agency workers. Recent research suggests the pattern of increasing atypical work may be slowing. But the size of this vulnerable workforce hasn’t diminished. We must ensure our legal framework does not favour atypical work, to ensure these new forms of work are good jobs, rather than a last resort to avoid unemployment. And new forms of working may need new forms of collective voice, alongside traditional ones, to rebalance labour relations in Britain.
  • Britain is becoming more entrepreneurial but is held back by low levels of public and private investment. Early stage enterprise is not translating into sustained growth or higher levels of good work.
  • The Office for Budget Responsibility cut its growth forecast for the UK economy sharply in November 2017, following changes to estimates of productivity. It now expects the economy to grow by 1.5%, down from its previous forecast of 2% 5 4.1 million, mostly between the ages of 25 to 34, were considered to be in ‘serious financial difficulty’. The FCA pointed towards a growing ‘wealth gap’ in British society driving people, especially the young, towards consumer credit.
  • Productivity is the cornerstone of the UK’s future GDP growth – and Britain is sinking to the bottom of G7 growth table.3 In line with this, the Office for Budget Responsibility has cut its growth and productivity forecasts sharply.4 Just as serious is the more recent trend for wages to grow more slowly than productivity – or not at all. This means that where productivity has risen, there has not been a commensurate rise in wages.

 

APSCo Responds to Future of Work report

Following publication of the Report, Tania Bowers, General Counsel at the Association of Professional Staffing Companies (APSCo), said: “As a trade body for professional recruiters, many of which supply into STEM sectors, we appreciate the recognition in the report of technological advances in the work place and the subsequent need to invest in skills training. We also recognise the importance of quality work as a key driver for the economy and we know that professional contracting offers good work to individuals and drives productivity in the economy.

“However, we are concerned that the report recommends working towards just one category of ‘worker’ for enjoying employment protection in UK law. The report advises that any change in national insurance or tax contributions by the self-employed should go hand in hand with these new rights and safeguards, but many professional contractors simply don’t want or need these protections.

“The report does not differentiate between vulnerable workers who are forced into false self-employment and those incorporated professional contractors who operate in the professional STEM market. We do recognise the need for professional contractors to be in a financial and legal position to provide for their pensions, sick pay and holiday pay, particularly if there is a political push for greater numbers of these incorporated contractors to be taxed as deemed employees. However, this must not be at the expense of flexibility in the labour market.

“We also refute the suggestion that the rise in a typical working and self-employment has been ‘largely the result of the UK tax system’. The senior professionals our members place choose to work flexibly for a variety of different reasons.”

Picture: Cover image of the Executive Summary of the most recent Report of the Future of Work Commission

Article written by Brian Shillibeer

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