The Future of Digital Work: The Challenge of Inequality

Excerpt

The worlds of work and organisation are increasingly being pervaded by digital technologies which provide opportunities to generate new sectors and work tasks, increase productivity and deliver effective public services but create many challenges for society. The COVID-19 crisis has caused the largest global digitalization experiment, forcing almost everyone to work, study or learn from home. On the optimistic side, the development of automation enabled by technologies including robotics and artificial intelligence brings the promise of higher productivity and economic growth. This is assumed to enable firms to scale up or down quickly thereby challenging traditional production patterns based on ownership of resources and blurring the boundaries between firms [8]. Digital platform firms adopt new business models that differ from traditional production processes based on input, process and output generating value instead by creating a network effect connecting customers, producers and providers while facilitating interactions in a multi-sided model. In order to trade goods and services on an online platform, individuals and firms need only a broadband connection, which offers economic opportunities also for small traders in developing countries. In terms of sectoral changes, digital technologies have shifted employment in different ways. In advanced economies, the past few decades have seen a decline in industrial employment and a shift from manufacturing to services. The trend in low-and-middle income countries has been different as the share of industrial employment primarily in manufacturing has remained stable and in some East Asian countries has risen. The World Bank [19] explains this trend as resulting from the falling cost of connectivity enabling emerging economies to produce more capital-intensive exports as well as due to increasing patterns of consumption of products and demand for new products as a result of rising incomes. In terms of skills, while the demand for less advanced skills that can be replaced by technology is declining, the demand for advanced cognitive skills, socio-behavioural aptitude needed to participate in global teams, and the ability to employ agile methods to maintain flexibility and adaptability to fast-changing demand is rising. While this trend has been evident for some time in developed countries, the same pattern is emerging in developing countries as the share of employment in high-skill occupations is rising [15]. …