FEATURE INSIGHT
studies estimating that globally 800 million jobs will be lost or affected. The findings of research conducted by the McKinsey Global Institute (MGI) are set out in the report A future that works: Automation, employment, and productivity (http://bit.ly/2iDgcXb). The executive summary observes that “The pace and extent of automation, and thus its impact on workers, will vary across different activities, occupations, and wage and skill levels. Many workers will continue to work alongside machines as various activities are automated. Activities that are likely to be automated earlier include predictable physical activities, especially prevalent in manufacturing and retail trade, as well as collecting and processing data, which are activities that exist across the entire spectrum of sectors, skills and wages. Some forms of automation will be skill-biased, tending to raise the productivity of high-skill workers even as they reduce the demand for lower- skill and routine-intensive occupations, such as filing clerks or assembly-line workers. Other automation has disproportionately affected middle-skill workers. As technology development makes the activities of both low-skill and high-skill workers more susceptible to automation, these polarization effects could be reduced.” The summary identifies five key factors that will influence the pace and extent of adoption of automation: ● technical feasibility – the technology has to be invented, integrated and adapted into solutions that automate specific activities ● the cost of developing and deploying solutions ● labour market dynamics – supply, demand, and costs of human labour as an alternative to automation ● economic benefits – e.g. higher throughput and increased quality, as well as labour cost savings ● regulatory and social acceptance can affect
the rate of adoption even when deployment makes business sense.
grow, partly fueled by productivity growth enabled by technological progress”, and asserts that “new technologies have spurred the creation of many more jobs than they destroyed, and some of the new jobs are in occupations that cannot be envisioned at the outset”. HR and AI hype In late 2017, HR.com published a report, The state of artificial intelligence in HR , revealing the following findings from a survey it had conducted: ● as a profession, human resources function (HR) is still toward the bottom of the AI learning curve ● AI has the potential to enhance HR in five functional areas: analytics and metrics, time and attendance, talent acquisition, training and development, and compensation and payroll ● the ability to analyse and predict are the AI features HR professionals want most from AI-powered applications ● HR will make use of automated AI interfaces to aid employees, with 75% anticipating that AI interfaces such as chatbots and virtual assistants will become an increasingly viable way for employees to get real-time answers to their HR-related questions ● employees will increasingly take direction from AIs ● more respondents predict job losses than job gains resulting from AI in their organisations ● AI is widely viewed as a valuable talent acquisition tool, with 70% of respondents agreeing that AI-based algorithms can be used to improve recruitment by scanning work samples, resumes and other materials ● current usage rates are low but are expected to explode in coming years ● HR professionals expect that AI will be used more for automation than augmentation
...new technologies
MGI’s report notes that the nature of work will change: “As processes are transformed by the automation of individual activities, people will perform activities that are complementary to the work that machines do (and vice versa). These shifts will change the organization of companies, the structure and bases of competition of industries, and business models…Individuals in the workplace will need to engage more comprehensively with machines as part of their everyday activities, and acquire new skills that will be in demand in the new automation age.” The findings reveal that an estimated 50% of the activities that people are paid to do in the global economy have the potential to be automated by adapting currently demonstrated technology; and though less than 5% of occupations can be fully automated, about 60% have at least 30% of activities that can technically be automated. In its latest report, Jobs lost, jobs gained: workforce transitions in a time of automation (http://bit.ly/2ig4Ufo), MGI estimates that as many as 375 million workers globally (14% of the global workforce) will likely need to transition to new occupational categories and learn new skills, in the event of rapid automation adoption. However, the report notes that “Even with automation, the demand for work and workers could increase as economies have spurred the creation of many more jobs than they destroyed...
Source: Jobs lost, jobs gained: workforce transitions in a time of automation (McKinsey Global Institute)
| Professional in Payroll, Pensions and Reward | February 2018 | Issue 37 40
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