Numerous studies over the years have highlighted the precarious nature of low-skilled work today, with people in such roles vulnerable to external shifts ranging from Covid-19 to automation. Recent research from Oxford University highlights the vulnerability of low-skilled workers to automated technologies, with this vulnerability exacerbated by a pandemic that has accelerated the pace of digital transformation.
The authors highlight that low-skilled workers not only operate in roles that are more vulnerable to automation, but they’re also less likely to have the skills to make transferring to any new jobs that emerge particularly easy.
Indeed, the authors believe that even those not directly threatened by automation, such as care workers, may nonetheless be indirectly affected as those whose work has been disrupted look for jobs elsewhere.
“Without proper action, automation could cause further deep distress,” they say. “But with the right policy frameworks in place, including well-targeted support for low-wage workers, it could power a better economy for all.”
The post-Covid landscape
The landscape post-Covid is also assessed in a recent paper from the McKinsey Global Institute, which looks at the labor market implications of the pandemic in the United States, United Kingdom, Germany, France, China, India, Japan, and Spain.
The paper also highlights the precarity of low-skilled work, but not due to the skills required for those jobs so much as the physical proximity in which the work tends to be done.
“The physical dimension of work is a new factor shaping the future of the work, brought to the fore by health and safety considerations,” the authors say. “This analysis shows that the pandemic’s short- and long-term impact is concentrated in four work areas with high levels of proximity: leisure and travel venues (including restaurants and hotels) employing more than 60 million in the eight countries, on-site customer interaction including retail and hospitality (150 million), computer-based office work (300 million), and production and warehousing (more than 350 million).”
Accelerating trends
McKinsey believes that the pandemic has accelerated three key workplace trends: a hybrid form of work that mixes remote and on-premise working; the growth in e-commerce and the “delivery economy”; and the investment in AI and automation to cope with fluctuating demand.
They suggest that the work areas most affected by proximity cover around 70% of the total workforce, which might bring about workforce transitions on a scale that surpasses even the most pessimistic projections on the impact automation was set to have on the workforce.
“Depending on how extensively these trends stick, our scenarios suggest that more than 100 million workers in the eight countries may need to switch occupations by 2030, a 12 percent increase from before the virus overall and as much as 25 percent more in advanced economies,” the authors say.
As we might expect, those with few qualifications and the young are projected to be most heavily affected, with the share of employment in low-wage occupations projected to fall by 2030 for the first time.
Help to adapt
As with so much at the moment, it’s likely that the pandemic is merely accelerating trends that were visible beforehand, and this certainly seems to be the case in terms of redeployment and retraining of workers.
“Policymakers might consider prioritizing equitable access to digital infrastructure as well as new ways of enabling occupational mobility,” the authors say. “As the share of independent workers grows, more innovation may be required to secure benefits for them.”
The track record of policymakers to adapt to the changing needs of the population does not fill one with confidence, but if the level of support provided to people can pivot with the speed with which financial support has been offered to workers during the pandemic then all may not be lost.
