Automation will disrupt the future of work — but also the future of global development

Auto parts production factory in Hung Yen, Vietnam. Photo by: Nguyễn ViệtThanh / ILO / CC BY-NC-ND

SAN FRANCISCO — Last week, the International Labor Organization announced the Global Commission on the Future of Work, a high-level international body chaired by the president of Mauritius and the prime minister of Sweden. The 20 members of the commission will focus “on the relationship between work and society, the challenge of creating decent jobs for all, the organization of work and production, and the governance of work.”

While this might look like an obvious problem for the United Nations to take on, experts tell Devex this kind of action has been slow in coming from the global development community.

Although automation will take longer to reach developing countries, the nature of work is already changing in these markets. This can happen for the better — such as when digital jobs create new opportunities for independent workers — or for the worse, such as when popular roles become automated. In the typical path out of poverty, smallholder farmers head to urban areas for work. But as automation starts to get in the way of those jobs, it will disrupt not only the future of work, but also the future of global development.

Automation and artificial intelligence threaten to transform industries at a faster rate than economies can adjust to these changes. The National Intelligence Council’s Global Trends Report for 2017 noted that this could limit the route that most poor countries take to develop. The World Bank has issued a number of reports on the countries and jobs most likely to be at risk; and a new report from the International Institute for Environment and Development recommends that developing country governments refocus their economic and social policies to protect their citizens from the impact that automation and technology might have on their jobs.

“The global development community is horribly slow at best; and worse, the magnitude of what they're unprepared for (to say nothing of how many people may be affected) is unprecedented.”

— April Rinne, sharing economy expert

“It is important for the global development community to start identifying how it can best help poor countries and poor communities prepare for the changes that are coming to the world of work,” Andrew Norton, director of the International Institute for Environment and Development and author of the report, said in an email to Devex. “Different development actors need to engage at different levels — with governments, businesses, workers or farmers — and provide answers suited to specific contexts. From helping to provide what is needed so vital social protection and education systems can be developed, to supporting broader development planning that builds on natural capital and the informal economy ― the development community has a significant role to play.”

The report explains that as low-paid industrial jobs disappear, so too will export manufacturing as a route to closing the gap between rich and poor countries. But developing country governments can respond through a range of strategies, including by investing in evolving education systems to ensure that people have the skills they need to succeed in this new economy. But while they need partners that can help them address these shifts, when they look to donor agencies, multilateral development banks and nongovernmental organizations, they tend to find institutions that are so focused on the present they may find themselves unprepared for the future.

A sector unprepared

Last month, sharing economy expert April Rinne published a column on the range of impacts automation will have around the world, with this call to action: “Global development organizations, wake up!”

Emerging market entrepreneurs have a unique opportunity to take advantage of the sharing economy by launching their own digital and platform companies before Silicon Valley giants enter their markets, she wrote. Meanwhile, some of those same companies that will eventually expand beyond large cities in developing countries have expressed a desire to do so responsibly. In both cases, the international development community is positioned to play an important role — but Rinne argues it has been notably absent from conversations about the future of work.

“The global development community is horribly slow at best; and worse, the magnitude of what they're unprepared for (to say nothing of how many people may be affected) is unprecedented,” she wrote to Devex in an email.

Concerns about the future of the global workforce — together with rising income inequality and growing frustrations with modern social welfare programs and other efforts to fight poverty — are leading to a growing interest in a universal basic income as one potential solution. GiveDirectly, an organization that has already challenged the way development is traditionally done by providing cash with no strings attached to the poor, has a pilot under way in Kenya. The program is universal, in that everyone within a region gets it; basic, in that it is sufficient for people to live on; and income, in that it is long term with the potential to change a life trajectory. Whether it is this or other models that provide social safety nets, many observers suggest now is the time to not only consider but also to test ways to make sure people are not left behind in this unprecedented era of technological change.

“It is fundamentally important that we confront these challenges from the conviction that the future of work is not decided for us in advance,” Guy Ryder, who leads the ILO, said at the launch of the new future of work commission.

The path out of poverty

Any NGOs running workforce development programs should consider which jobs might be easily replaced by AI or automation so they don't provide training for soon to be obsolete skills, said Ann Mei Chang, the former director of the Global Development Lab at the U.S. Agency for International Development. Last August, she headed to Aspen, Colorado, for the annual Brookings Blum Roundtable on Global Poverty, where the focus of the conversation was on “the future of work in the developing world.” Shortly thereafter, President Donald Trump won the presidential election, which meant Chang left USAID, returned to San Francisco, and took a closer look at the question of how the future of work will impact global development.

"In this last election cycle, it became clear that the changing nature of work is having a huge impact in the United States. And, as I thought about the implications for developing countries, I became concerned that the challenges were going to be even more severe,” she said.

In developed countries, there is enough wealth to make up for routine jobs replaced by automation and AI through growth in the service economy, even if it means geographic displacement and skills retraining. “It's a difficult path — but there is a path,” Chang said.

The question that haunts me is what will low-skilled people be able to do in the future that will be exportable and bring in hard currency?

— Ann Mei Chang, former director of the Global Development Lab at USAID

But she explained that developing countries lack the local wealth to drive a significant service economy. So as they lose the advantage of lower cost labor as call centers or factories become increasingly automated, the path out of poverty for both individuals and countries becomes less clear.

“The question that haunts me is what will low-skilled people be able to do in the future that will be exportable and bring in hard currency?" she said.

One option is engaging private sector companies to train young people with the skills they need in this new era and then to match them with job opportunities, said Susan Reichle, president and chief operating officer at the International Youth Foundation. Her organization partnered with the GE Foundation to develop a Passport to Success curriculum, providing jobseekers with life skills training. It has since trained 185,000 young people across 50 countries and 20 languages. Corporate partnerships have been key: in one example, Hilton Worldwide, the global hospitality company, partnered with IYF as part of its corporate responsibility strategy that trains young people for careers in the hospitality industry.

“Technological skills are important, but life skills are enduring,” she told Devex. “My advice is to focus on skills such as adaptive thinking, communications, leadership, teamwork. That is where I hope we invest, particularly with youth. If we help them have those life skills they will be more resilient.”

The role of the private sector

Having worked on USAID’s Haiti earthquake response in 2010, Reichle said she understands why global development professionals find it difficult to think about long-term challenges in the midst of short-term crises. In recent years, she has been pleased to see the growing emphasis on entrepreneurship as a pathway to jobs for refugees, explaining that the best way to help refugees is to make sure they can change their own lives. Moving forward, she said the global development community can work in partnership with governments and the private sector to invest in middle skills — which require less training than a four-year college degree but more training than a high school diploma — and to remove the stigma around vocational and technical education.

"No one company, no one industry, no one government, no one foundation, no one school district can do it on their own," Mary Snapp, corporate vice president of Microsoft Philanthropies, said at an event on youth employment organized by IYF in April in Washington, D.C. "It's all about leveraging partnerships so that we can ensure young people will have digital skills, technical or middle skills, and some even computer science coding skills. So we can ensure that, in the future of work and for the jobs of tomorrow, we work together to ensure no one is left behind."

Google.org is among the organizations putting money behind the question of how to help people prepare for the future of work. The philanthropic arm of the technology company announced last month that it will award $50 million in grants to nonprofits providing skills and jobs training programs to meet the evolving demands on the labor force. While grants have been awarded to organizations in the U.S. and France, Google.org tells Devex they will expand internationally over the next two years.

And the World Economic Forum is among the organizations producing thought leadership on how to accelerate workforce reskilling. Its new Center for the Fourth Industrial Revolution in San Francisco was set up to tackle big questions like the future of work. Devex has been in conversations at the center, where Silicon Valley business leaders together with policymakers have discussed how this transition can create new opportunities rather than block pathways to prosperity.

Several of these Silicon Valley actors that are positioning themselves as partners to nonprofits see technology skills and life skills as one and the same, with some arguing that coding should become core to curriculums across the world. There have been investments from venture capitalists, impact investors and development finance institutions alike in models including Laboratoria, which provides coding education to women in Latin America; Andela, which is providing training and job placement for African developers; and Coursera, which provides online education courses, many of them including 21st century skills. Because developing countries will have the hardest time incorporating coding into education — due to factors such as insufficient resources for teachers, a disconnect between the education system and the technology industry, or a lack of government support — they risk falling even further behind.

Teaching girls and women how to code allows them to participate in the digital revolution so they can pursue jobs in the technology industry, said Marieme Jamme, founder of iamtheCODE, an organization that promotes science, technology, engineering, mathematics, arts and design for African girls and women. Last week, she launched iamtheCODE in China, partnering with the United Nations Development Program on a hackathon in Beijing around the Sustainable Development Goals. Jamme said she wants to prepare girls and women for a future in which “made in China” becomes “made in Africa,” explaining that STEM skills will help them respond to Chinese demand for African talent, working in jobs that will continue into the Fourth Industrial Revolution.

Anticipating the future

It is no surprise that the global development community has been slow to act, despite how fast these changes will transform the global workforce, said George Ingram, senior fellow of global economy and development at the Brookings Institution.

“It is a tough question with no clear or simple answers. Economists and business experts disagree on the likely future of work and impact of technology,” he said. “Some see widespread unemployment, others high-quality jobs. Technology change is happening so fast, it's hard to look three years into the future, much less 10 years.”

It is a tough question with no clear or simple answers. Economists and business experts disagree on the likely future of work and impact of technology.

— George Ingram, senior fellow of global economy and development at the Brookings Institution.

Often, the reaction from global development professionals is that automation in the countries where they work is some way off. But that is not the only threat to employment in developing countries, Ingram said. Technological change in developed countries is the more immediate threat, with the rise of AI eliminating the need for outsourcing, or the growth of 3D printing reducing the need for factories overseas.

The future of work was on the agenda at last month’s Singularity University Global Summit. Speakers talked about new rules to live by in this era when technology will reshape every job. The key, they said, is lifelong learning, so the question for the global development community becomes how to build that approach into its work on education, training and employment.

At the summit, Devex spoke to Jack Sim, founder of the World Toilet Organization, who said these emerging technologies are creating an “anti-jobs future.” He explained that the education system needs to move away from testing for memory, and instead teach what he calls the 7 Cs, including curiosity to question, collaboration, and communication skills to inspire action in others. In the age of robots, he said, what is needed is to humanize our education system.

“One of the inevitable impacts of the disruption that is occurring is the pace by which workers will be affected,” Gary Bolles, a future of work expert who spoke at Singularity University last month, told Devex. “New technologies are going to emerge and go to scale really fast and that means the bottom can drop out of the market or brand new markets can suddenly appear.”

At the upcoming Social Capital Markets conference in San Francisco, he hopes to discuss the future of work with a community of leaders focused on impact, to help them see these shifts not just in terms of mass disruption, but in also in terms of market opportunities, to help the populations they work with so that they can help themselves.

“Rather than adopting a wait-and-see approach, we must think seriously about the future of work that we want and how to get there,” wrote the chairs of the new ILO initiative, Mauritian President Ameenah Gurib-Fakim and Swedish Prime Minister Stefan Löfven, in an op-ed. “The future is not pre-determined and can be influenced by the societal choices and policies that we make today.”

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    Catherine Cheney

    Catherine Cheney is a Senior Reporter for Devex. She covers the West Coast of the U.S., focusing on the role of technology and innovation in achieving the Sustainable Development Goals. And she frequently represents Devex as a speaker and moderator. Prior to joining Devex, Catherine earned her bachelor’s and master’s degrees from Yale University, worked as a web producer for POLITICO and reporter for World Politics Review, and helped to launch NationSwell. Catherine has reported from all over the world, and freelanced for outlets including the Atlantic and the Washington Post. She is also the West Coast ambassador for the Solutions Journalism Network, a nonprofit that trains and connects journalists to cover responses to problems.