Global Commission on the Future of Work in its “Work for a Brighter Future Report” opined that technological advances like artificial intelligence, automation and robotics will create new jobs, but those who lose their jobs in this transition may be the least equipped to seize the new opportunities. Moreover today’s skills will not match the jobs of tomorrow and newly acquired skills may quickly become obsolete. Further, the greening of our economies will create millions of jobs with adoption of sustainable practices and clean technologies but other jobs will disappear as countries scale back their carbon- and resource-intensive industries. Thus the report placed a great focus on the need for the process of life-long learning by increasing investment in people’s capabilities.

The present context owes a reference to the remarks of John Maynard Keynes in 1930, wherein he declared that technology would usher in an age of leisure and abundance within a hundred years. The increasing instances of people working from home in today’s digital world broadly capture a glimpse of it.

The advent of new technologies drives firms to adopt new methods of production wherein they may hire workers in one location to produce parts, workers in another location to assemble, and those in a third location to sell. As a result, markets expand, and societies evolve. Meanwhile, consumers enjoy a wider range of products at lower and competitive prices.

The larger question is are these technological advancements beneficial vis-à-vis existing employment conditions or they cause huge disruptions leading to higher unemployment? People may believe that machines will remain and they will lose their jobs, particularly in countries with large proportion of working population. However, countries facing demographic ageing and labour gaps in their domestic market may see it differently.

So the issue is how we approach it. One way is to invest in building people’s capabilities in tune with technological advancements. For instance, Vietnamese workers developed their foreign-language abilities to seize the opportunities provided by integration into the global value chains. Government of India invested in technical universities across the country, and subsequently India became a world leader in high-tech sectors.

Notwithstanding the opportunities, however, there are still disruptions as automation of processes puts at risk, particularly those low-skilled workers who are engaged in routine tasks. The resulting displacement of workers generates anxiety, just as in the past. For instance, once in 1589, Queen Elizabeth I of England said to her clergyman William Lee who applied for a royal patent for a knitting machine that you should consider how this would impact the poor subjects as it may ruin them by depriving them of their employment opportunities. Similarly in the 1880s, Qing dynasty fiercely opposed constructing railways in China, arguing that the loss of luggage-carrying jobs might lead to social turmoil.

Fears of robot-induced unemployment have dominated discussions about the future of work. Workers involved in routine tasks that are “codifiable” are the most vulnerable. The examples are numerous. More than two-thirds of robots are employed in the automotive, electrical/electronics, and metal and machinery industries. Based in China, Foxconn Technology Group, the world’s largest electronics assembler, cut its workforce by 30 per cent when it introduced robots into the production process. When robots are cheaper than the existing manufacturing processes, firms become more amenable to relocating production closer to consumer markets.

As per the World Development Report, 2019, share of industrial employment dropped more than 10 percentage points in the Republic of Korea, Singapore, Spain, and the United Kingdom over the last two decades. However, this was mainly due to a shift in employment from manufacturing to services as these countries grew. By contrast, millions of industrial jobs have been created in developing countries since the late 1980s. Indeed, the share of industrial employment has increased significantly in emerging markets.

The real situtation is that technology is disrupting the demand for skills. Individuals with more advanced skills are taking better advantage of new technologies to adapt to the changing nature of work. For example, returns to primary schooling in India increased during the Green Revolution of the 1960s and 1970s, with more educated farmers adopting new technologies.

Technology has the potential to improve living standards, but its effects are not manifesting themselves equally across the globe. Workers in some sectors benefit handsomely from technological progress, whereas those in others are displaced and have to retool to survive. Irrespective of technological progress, persistent informality continues to pose the greatest challenge for emerging economies. Informal employment remains at more than 70 per cent in Sub-Saharan Africa and 60 per cent in South Asia and at more than 50 per cent in Latin America. In India, the informal sector has remained at around 90 per cent, notwithstanding fast economic growth and technology adoption. Both wages and productivity are significantly lower in the informal sector. Informal workers have neither health insurance nor social protection.

There are evidences from European countries, which suggest that although technology may be replacing workers in some jobs, overall it raises the demand for labour. As per World Development Report 2019, despite the high prevalence of robots, the employment rate remained high in Germany, Korea, and Singapore.

In general, Machines replace workers most easily when it comes to routine tasks that are codifiable such as operating welding machines, assembling goods, or driving forklifts. These tasks are easily automated. However, skills that cannot be replaced by robot based automisation are general cognitive skills such as critical thinking and socio-behavioural skills such as managing and recognizing emotions that enhance teamwork. Finally, technology is changing how people work, giving rise to the economy in which organizations contract with independent workers for short-term engagements.

The Industrial Revolution, which mechanized agricultural production, automated manufacturing, and expanded exports, led to the mass migration of labour from farms to cities. Improvements in transcontinental communications technologies, along with the fall in transportation costs, have expanded global value chains toward East Asia. But there are factors beyond technology which have been shaping the location of business process outsourcing. For instance, Philippines overtook India in 2017 in terms of market share in the business process outsourcing at least in part because of the country’s lower taxes.

In the present era of technological advancements, employment has shifted away from middle-skill occupations such as machine operators to technology- based niche specialisation. This is one of the factors that may translate into rising inequality in advanced economies. Both middle and low-skill workers are witnessing falling wages; the former because of automation; the latter because of increased competition.

Finally, technology is changing how people work and the terms under which they work. Instead of the once standard long-term contracts, digital technologies are giving rise to more short-term work, often via online work platforms. Online work platforms are eliminating many of the geographical barriers previously associated with certain tasks. Bangladesh contributes 15 per cent to the global labour pool online by means of its 650,000 freelance workers. It all depends how these technological disruptions are viewed i.e. as an opportunity or a threat.

So, the argument that technology has created more jobs than it displaced depends largely on the systemic changes in country’s policies and priorities on how it envisage skilling and re-skilling of its workforce. Answer to the question lies in the country’s willingness and far-sightedness in terms of seizing the opportunities unfolded by labour market disruptions created by the fourth industrial revolution by providing credible responses to people’s concerns and unlocking the countless opportunities that these changes bring. The future of Skill India initiatives in seizing these opportunities and harnessing demographic dividend of the country offers one of ways to realise larger dream of India becoming a five trillion dollar economy.