What companies must do to prepare for the future workforce

Technology is disrupting the workforce from the top to the bottom, but companies that prepare and invest in their employees now will have a competitive edge in the future.
19 April 2018 | 1709 Shares

Penny Pritzker, co-chairperson of the independent task force behind the The Future of the U.S. Workforce report. Source: Flickr / World Travel & Tourism Councol

W e live in the era of industry 4.0, where often technology is not just a tool for business, it is the business. Technology is re-writing the rules and processes of most sectors, even those that aren’t already technologically focused.

Rightly so, this often evokes fear about the future of work: where are jobs heading in the technology age? What skills do companies need and will they even need a ‘workforce’?

Addressing the intrigue and anxiety from both employers and employees alike, the US-based Council on Foreign Relations (CFR) has undertaken an extensive report, ‘The Work Ahead: Machines, Skills, and US Leadership in the Twenty-First Century’, on the future of employment.

Compiled by an independent taskforce, including the Interim President of Michigan State University, the study examines how to rebuild the links among work, opportunity, and economic security in the face of accelerating change. So, what does it tell us?

Nearly two-thirds of the 13 million new jobs created in the US since 2010 required medium or advanced levels of digital skills.

The report notes, “Technology has been the biggest cause of job disruption in recent decades, and the pace of change is likely to accelerate.”

It cites the Brookings Institute which found that in the twenty-first century, new US jobs requiring high levels of digital skills has more than quadrupled already, from 5 to 23 percent of total employment. While the number of jobs requiring few digital skills has fallen from 56 percent to less than 30 percent.

This means that basic familiarity with spreadsheets, word processing, and customer relationship management software is becoming a baseline requirement for many positions, according to the report.

Watch former US Department of Commerce official Laura Taylor-Kale discuss how technology can unlock potential.

Technical skills will command more money

According to the study, liberal arts students who bolster their education with additional technical skills, such as graphic design, social media, data analysis, or computer programming, roughly double the number of entry-level jobs available to them and can see an estimated $6,000 bump in initial salary.

chart

Average salary increase for technical skills. Source: CFR

As many as one-third of American workers may need to change occupations and acquire new skills by 2030 if automation adoption is rapid.

It is increasingly possible to replace human labor with machines. However, the report states that, though this will also create new opportunities, it still presents obstacles in acquiring the education and skills needed to prosper in a more automated work environment.

Furthermore, public concerns about technology are growing. An October 2017 Pew Research Center poll found that three-quarters of Americans are worried about a future in which computers and robots will do many jobs, fearing that job prospects will diminish and economic inequality will worsen.

There are too many restrictions to work and hiring

According to the report, too many jobs are going unfilled because of restrictions related to credentialing, mobility, and hiring practices.

For example, it says there are nearly six million job openings in the United States, close to the largest number since the Department of Labor began tracking in 2000. Seven million workers are officially unemployed, and millions of others either are underemployed or have dropped out of the labor market entirely. To build the workforce of the future, more proactive and flexible hiring practices are needed with an emphasis on retraining and rehiring.

Watch former US Secretary of Commerce Penny Pritzker discuss why investing in education and training can help companies grow.

Public expenditures on assistance and retaining for unemployed workers in top developed countries. Source: CFR

What does this all mean for employers?

Accelerating technological change will alter or eliminate many human jobs, but many new jobs will be created, but the higher-paying ones will require greater levels of education and training.

In turn, the report notes that “employers are finding themselves competing for often scarce pools of talent and need to develop deeper links with the education system.” A study by IBM, for example, found few courses being offered nationwide in such strong job-growth areas as cloud computing, data analytics, mobile computing, social media, and cybersecurity. Companies must be engaged at the educational level to play their part in building the workforce they will need in the future.

Watch Eduardo J. Padrón, president of Miami Dade College discuss why pathways such as college internships and apprenticeships are making a big difference.

“Technology does not see borders” and therefore, “embracing technological innovation and speeding adoption are ‘critical’ for…economic competitiveness,” the report notes.

If companies don’t innovate, they will lose the ‘best and the brightest’ to other companies and countries.

Ultimately, employers must embrace flexibility and pursue different approaches to hiring, as well as understand that investing in their workforce and new resources is key to remaining competitive. There are challenges ahead, but with adversity comes new challenges if a business is agile and open-minded enough to be ready and able to grasp them.