Global megatrends Changing the Ways we Live and Work

Published on 30th April 2019

Digitalisation, globalisation and demographic change are having a profound impact on our societies, our daily lives and our work. New technologies are creating new employment opportunities. Between 2006 and 2016, four out of ten new jobs in OECD countries were created in highly digital-intensive sectors. Thanks to new technologies, we can automate dull and dangerous tasks, and we have more flexibility in choosing where and when to work.

Despite these opportunities, however, technological change and globalisation are also causing widespread anxiety, as we highlight in our I Am the Future of Work campaign. Although some of these concerns may be well-founded, so far mass technological unemployment is not one of them. In OECD countries total employment has increased by about 50 million since 2007: despite the loss of some jobs to automation and globalisation, many more have been created.  

Challenges for the Future of Work

The OECD Employment Outlook therefore does not envisage a jobless future. But it does foresee major challenges for the future of work.

First, there will be substantial changes in the labour market – with significant churning of jobs as new jobs replace obsolete ones in declining sectors and activities.

We estimate that, in OECD countries, 14% of jobs are at high risk of automation and a further 32% will undergo significant change in how they are carried out. Those risks are even higher in Germany: 18% and 36% respectively. This means millions of workers would need to find a new job or learn new skills to perform the tasks that their job will require. For many, this will be difficult. This is all the more true in countries where unemployment rates and NEET rates for youth are still high. And the challenge of retraining will be particularly acute for older workers.

Second, the emergence of new forms of work has highlighted gaps in job quality, access to training, bargaining power and social protection for non-standard workers such as part-time or temporary workers or the self-employed. In some countries, they are 40-50% less likely to receive income support during an out-of-work spell.

Third, we see a risk of a further increase in inequalities, a concern at the heart of our Inclusive Growth Initiative. People who are already disadvantaged in the labour market also face greater risks. Not only do low-skill workers face a higher likelihood of their jobs being automated, but across the OECD, the probability that they engage in adult learning is 40 percentage points lower than for other workers. In Germany that gap is 50 percentage points.

But we should avoid falling into the trap of technological determinism. With the right policies, we can manage these challenges. 

A Transition Agenda for a Future that Works for All

To that end, the OECD is proposing a Transition Agenda for a Future that Works for All, with concrete policy directions in 4 main areas.

First, ensure adequate labour law protection for workers, regardless of their employment status. Countries should tackle false self-employment, minimise the “grey zone” between salaried work and self-employment, and extend rights to workers who are left in this zone.

Second, adapt and extend social protection. We should ensure that entitlements are portable across jobs. We also need to improve coverage for non-standard workers and to make social protection more responsive to changes in people’s needs – for example by reviewing entitlement criteria. Denmark’s new unemployment benefit system, for example, treats all income sources equivalently, thus improving access for non-standard workers and workers with multiple sources of income.

Third, strengthen and adapt adult learning systems. We need to give workers – especially the most vulnerable – opportunities to train throughout their working lives, regardless of their employment status. This includes removing time and financial constraints to participation in training, providing quality information and counselling – as Germany is considering doing – and making training rights portable – as done for example by France with the Individualised Learning Account (Compte Personnel de Formation).

Fourth, engage social partners. The Swedish Job Security Councils are a notable example: they provide support to displaced workers, even before displacement occurs, and access to training when mass layoffs occur. Non-standard workers are 50% less likely than standard workers to be unionised. Access to collective bargaining and social dialogue should be extended at least to some forms of non-standard work.

We will also need potentially significant additional resources and a whole-of government approach – as also documented by our Going Digital project. In this context, I want to congratulate the German government for its comprehensive Work 4.0 strategy.

The policy effort needs to be properly funded. While there is space to improve the effectiveness and targeting of key policies, the need for funding is likely to go well beyond, especially for social protection and adult learning. Countries may need to increase revenue sources and involve other stakeholders, including businesses – who badly need skilled workers and a conducive social and economic environment.

The core message of the 2019 OECD Employment Outlook is one of optimism: the future is in our hands! We face significant transformation, but we have the opportunity and the determination to use this moment and build a future of work that benefits everyone. This is of course not only about labour market policies. We have to foster innovation and business dynamism, ensure the provision of quality infrastructure, provide good educational opportunities to all, deliver effective public governance, the list goes on. The OECD is working in all these areas, and will be here every step of the way to help governments design, develop and deliver better policies for better lives. 

By Angel Gurría

OECD Secretary-General.


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