Future of jobs: 75% of organizations are planning to introduce AI over the next five years. Image: Unsplash/Sigmund
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- Technology is continuing to shift almost every job role, whether it’s in a factory or behind a desk.
- The World Economic Forum's Future of Jobs Report 2023 finds most technologies will have a positive impact on jobs in the coming five years.
- But almost a quarter of jobs will change as various impacts, including the green transition, play out.
- Jeff Maggioncalda, CEO at Coursera, the online learning company, and Saadia Zahidi, World Economic Forum Managing Director, discuss the report's implications for employers and workers.
“We're pretty much all in the same boat, whether you are a factory worker or on the frontlines or whether you're a knowledge worker sitting behind a desk. Technology is shifting the way almost every job task will be performed.”
This was the verdict of Jeff Maggioncalda, CEO at Coursera, the online learning company, on the challenges ahead for employers and jobseekers in a rapidly transforming world of work. He was commenting on the Future of Jobs Report 2023 from the World Economic Forum, into which Coursera contributed data.
It is not surprising that new technology adoption and digitalization continue as the top two drivers of business and job transformation.
While the net impact of most technologies on jobs is expected to be positive over the next five years, employers predict a structural labour market churn of 23% of jobs – a combination of 10.2% job growth and 12.3% decline.
In addition, 44% of workers’ skills will be disrupted during that period, with cognitive problem-solving moving into the foreground, followed by analytical thinking and technology literacy.
The Forum's Radio Davos podcast spoke to Jeff Maggioncalda as well as Forum Managing Director, Saadia Zahidi, about the skills we will need to adjust to a rapidly changing world - and more findings from the report. Below are some of their key quotes.
What is the Future of Jobs Report?
"Every couple of years, we extensively survey Chief Executive Officers, Chief Human Resources Officers, Chief Strategy Officers, and ask them what they think is currently impacting the world of work," says Zahidi.
"What are the technologies they're likely to adopt? What are the other megatrends that they will be facing? And then what does that mean for specific jobs within their company, within their industry? What does that mean for skills and what does that mean for how they acquire and develop talent?
"This is the fourth time we've done this and we're covering about 45 countries and 27 different industry clusters. The overall population of workers that is represented by these employers is about 11.3 million. Globally that represents nearly 673 million types of jobs that we're able to say something about."
What trends are most affecting the jobs market?
"Uncertainty is really key here when it comes to some of those macro trends," says Zahidi.
"There are some very positive ones. So it's clear that the investments in the green transition will be very positive for jobs. It's clear that ESG standards and their widespread application across different companies and industries is likely to add to growth.
"At the same time, there is a potential risk of a prolonged economic downturn. There continues to be high inflation that impacts input costs, but also impacts the purchasing power of consumers. Those are likely to be trends that will negatively end up impacting jobs."
But the picture is more mixed when it comes to "the subject of the day": technological change and how fast companies are adopting technologies, adds Zahidi.
"For about half of companies, they expect the outlook for jobs to be very positive, but a quarter of companies expect the outlook for jobs to be quite negative. It depends on specific technologies, but it's not quite as positive as the green transition and not quite as negative as some of the economic trends we see."
What impact can we expect generative AI to have on jobs and skills?
Zahidi says: "We've been looking at both automation and other forms of technological change for some time. We've tried to build a sense of what we call the human-machine frontier. What types of tasks and skills are getting automated? On average, the respondents to our survey do not find that tasks are more automatable today than they were three years ago.
"The automation of physical and manual work is no more accelerated than it was three years ago. To some extent that's because it's been occurring already.
"But when it comes to very human traits like coordinating between people, like helping with decision-making and reasoning or communicating, that's where actually you see an uptick. That's where you see a greater prediction around automation than before.
"It's not surprising because we've all seen what is happening with generative AI and how fast that's getting adopted across various industries. That's exactly where there's some prediction that we're likely to see further disruption.
How will AI affect job profiles?
AI and Big Data jointly rank only 15th as a general core skill today. However, it is already the number three priority in company training strategies from now until 2027. For very large organizations with over 50,000 employees, it even gets top billing. Across industries, 75% of organizations are planning to introduce AI over the next five years.
“Our founder, Andrew Ng, is often quoted as saying AI is the new electricity," says Maggioncalda. "It's going to infuse everything in society. Some people are calling it a general purpose technology. It will change everything.
“Whether you're ready or not, almost anything digital is going to change and become AI enabled.”
How is the World Economic Forum ensuring the responsible use of technology?
Can you explain the churn happening with jobs?
Overall, we're seeing quite a lot of change when it comes to the future of jobs, says Zahidi.
"Over the last three years, we've seen the pandemic greatly disrupt a number of workforces. We've been seeing geopolitical disruptions that have also affected various industries, everything from travel and tourism to food and energy production. Workers are reticent to join the workforce again. Those industries have changed so much, and the skills demanded are so different, that those industries are struggling to find the skill sets they need.
"When it comes to layoffs in certain industries, they went through a massive expansion in the midst of the pandemic and are now going through a readjustment. But the overall numbers in most advanced markets point to very tight labour markets.
"We can't forget about the number of emerging and developing economies also covered by this survey, where there's the opposite concern: there still isn't a recovery to pre-pandemic levels of unemployment and which was already fairly high at that period of time, especially for youth."
Which jobs will see the most growth?
Zahidi says three core areas emerge as areas of high job growth, both relative to their current size and also when it comes to absolute changes.
"The highest amount of growth is expected to be in sectors that require green jobs and green skills: from specialists in sustainability to those working on green energy production, renewable energy sources, renewable energy engineers, solar energy installation. These are all areas that are likely to grow in line with the types of investments we're seeing governments make and the incentives that they're creating for companies to invest in those areas.
"But when it comes to the largest absolute gains, the largest numbers of jobs being created, that is really going to be coming from education and from agriculture. There's likely to be about 10% growth in the education industry as a whole, leading to about 3 million additional jobs for vocational education teachers and university and higher education teachers. When it comes to agricultural professionals, we're expecting that agriculture equipment operators, graders and sorters are expected to see a 15 to 30% increase, leading to about an additional 4 million jobs."
Which skills are employers now seeking?
The Future of Jobs Report 2023 shows the skills organizations consider to be central to their work - cognitive skills come out on top.
"There's more of a focus and an interest in having people with analytical thinking, people with creativity," says Zahidi.
"But it's also become very important to have leadership skills and to have social influence, and the ability to work with other people. The traits that make us human, make us able to relate with each other and to get innovative, creative things done in the workplace.
"At the same time, I don't want to downplay how much interest there is from employers in ensuring their workers are able to use the new technologies that have emerged in the workplace, understand them better and improve their productivity.
"So it's this unique combination of analytical and creativity, analytical skills and creativity along with leadership and social influence, and the ability to actually use technology, especially Big Data."
How can we best upskill and reskill people to adapt to these trends?
“Organizations are realizing that they are going to have to retool," says Maggioncalda. "We're going to need a different kind of talent, or at least people with different talents that are associated with keeping up with change.
“In a remote work world, where there are lots of notifications and chatter all over the place, just staying focused on a job task is very challenging. I do think this whole idea of to what degree an individual can perform well in intense periods of change and uncertainty, and working with diverse global teams – that is going to be important."
"Nearly half of the skills that people like you and I are using every single day in the workplace are going to have to change in the next 4 to 5 years alone," adds Zahidi.
"That means we need very rapid reskilling and upskilling - a lot of workers can be self-motivated and will do that. But in many cases, it's employers themselves that are going to need to provide that reskilling and upskilling. In other cases, governments are going to need to provide a lot more support."
While companies say they are prioritizing AI, the Future of Jobs 2023 report finds little correlation between this strategic direction and an increase in skills training for their employees.
Similarly, universities struggle with adapting to this ongoing change, Maggioncalda says.
“We're going to be looking at a hybrid kind of higher education where industry plays a bigger role, brought into the universities through partnership” – a model Coursera is already working on with the likes of the University of Pennsylvania, Imperial College London and the University of London.
In this way, Maggioncalda explains, students can get the best of both worlds: a college degree with the associated academic rigour and broader educational background, as well as deeper, job-related skills.
And there is also a major role for governments to play, with 45% of businesses surveyed stating that funding skills training would be an effective way for governments to support talent acquisition. Government funding for upskilling and reskilling outranks greater employment flexibility, tax incentives, improving school systems and changes to immigration law.
"There's another angle to this," adds Zahidi, "which is employers simply have to think very differently about skills instead of relying on very traditional signals of what indicates a skill in a person. Is it really where they got their degree from, what type of degree they had, or which workplace they worked in 10 years ago? Or is it actually what they're able to demonstrate in the workplace?"
How are employers changing the way they look at skills?
Employers increasingly assess job applicants’ skills, rather than base employment decisions on a university degree, the Future of Jobs 2023 study finds.
“Companies say that they're moving to skills-based hiring, but there's still a question of, well, how do you observe the skills in the absence of a college degree or other learning credentials, in the absence of work experience,” Maggioncalda points out. “How do you know if someone has the skills?”
Only a fifth of employers consider the completion of short courses and online certificates – so-called “micro-credentials” – as one of their top three assessment criteria. Opening up to those could enable them to tap into previously inaccessible talent pools, ranging from lower-income learners to parents who want to return to work.
Zahidi says: "If employers take a more skills-first approach when it comes to hiring, retention, promotions, they'll actually be able to assess people on the basis of what they really know and what they're able to do. They're also able to then target much more specifically their reskilling and upskilling programmes.
"The other big win out of this is that if you pull the skills-first agenda forward and move a little bit away from university credentials and other more traditional signals, many more people have an opportunity because it doesn't mean that we're limited to the pool of people that have been to a specific type of degree or accreditation.
"There's no evidence that people that haven't been to university aren't able to reskill or upskill towards very specific areas that companies need more talent in. So it solves a lot of problems at the same time, provides upward social mobility, helps companies find the right talent, and allows governments to focus much more on broad based prosperity rather than more limited support for specific parts of the workforce."
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The views expressed in this article are those of the author alone and not the World Economic Forum.
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