Technology is increasingly capable of replacing people in more and more types of jobs, and this will occur in an environment where the developed world is aging and shrinking. What can leaders do to manage both the direct (workers/customers) and indirect (economics/politics) effects of these changes?
The Future of Work
Labor is changing as a result of converging technological and socio-economic forces, which affects all companies and public institutions who rely upon, provide services for, and sell to people. Software is enhancing, and in some cases replacing, white collar jobs in a similar fashion that industrial revolution technologies disrupted jobs based on human muscle. Robotics, industrial automation, and augmented reality – accelerated by software – are effectively redefining skilled labor.
These technologies converge with an unprecedented demographic crisis in the developed world that is not broadly understood. The trend towards lower birth rates that began in the 1970s is now manifesting in aging and shrinking populations, which impacts consumption patterns, service requirements, social systems, aggregate economic performance, and national competitiveness.
Follow our analysis to identify how these forces interplay to drive the behavior of nations and economic systems.
Labor & Technology
Machine learning and artificial intelligence technologies are reaching an inflection point, which will enable computers to replace workers in more and higher-skilled roles than ever before. Machine learning algorithms will ultimately be applied to every existing software application, which will have effects as broad and significant as the application of the internet to software in the 1990s.
Robotics and drone technologies are nearing an inflection point that will enable their adoption into economic activity far beyond the current, primarily industrial, automation applications. Increasingly capable and autonomous robots are enabled by machine learning algorithms and battery technology. Next generation robotics systems will permeate, enhance, and offset jobs in every part of the economy.
Declining birth rates in developed economies are leading to aging and shrinking populations on a sustained basis for the first time since the Black Death in the 14th century. This affects the social contract, which is based on ratios of contributors vs. consumers that are no longer relevant, especially in Europe and Asia where the decline is most advanced. Demographics affects how people live, the products they buy, and the services they need.
Just as IoT sensor technologies take digital information out of the real world, AR technologies use hybrid visualization to bring digital information into the real world. Digital overlays and communications both facilitate new capabilities and allow less-skilled workers to be more productive, changing the relationship between skill, labor productivity, and value.
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