Think critically about impact of AI, Industry 4.0, geopolitics & other drivers of change – Opinion News

By S Ramadorai

The global landscape of work is undergoing a profound transformation driven by artificial intelligence (AI) and Industry 4.0 technological advancements, shifting demographics, and evolving social and economic expectations. The World Economic Forum’s Future of Jobs Report 2023 provides a view of these drivers, highlighting their impact on the way we work, where we work, and who does the work, presenting both opportunities and challenges. The thoughts outlined here build on my presentation at the Asian Development Bank Institute (ADBI), Japan, and serves as a guide to the document published by ADBI titled “The Future of Work, Artificial Intelligence, and Digital Government: Policy Perspectives for Asia” that delves deeper into these themes and provides a road map to reflect on the future of work.

Drivers of change

The world of work is influenced by a variety of supply- and demand-side drivers. On the supply side, factors such as demographics, migration, public health, cost of living, and social trends are reshaping the availability and expectations of workers. For instance, ageing populations in many countries are leading to labour shortages, especially in care sectors, while migration patterns are shifting as people seek greater economic stability and security. The increasing cost of living is also forcing workers to reconsider wage norms and social protection, while growing recognition of work-life balance is influencing how people approach work.

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On the demand side, technology is playing a pivotal role. AI and automation are taking over routine tasks, making roles that require cognitive, creative, and emotional intelligence more important. Other drivers such as cybersecurity concerns, sustainability, and geopolitics are further shaping the demand for labour force, as businesses reassess global supply chains and operational practices. Moreover, globalisation continues to create new markets, but at the same time, requires organisations to adapt to the diverse regional expectations and challenges.

Impact of AI

The large-scale adoption of AI and automation is resulting in production and processes becoming more agile, cost-effective, and high-yielding. These effects, along with increased consumer demand for high-value products and services, are likely to act as a catalyst for economic growth and innovation that will create higher-order jobs. For example, in industries like finance, healthcare, and logistics, AI is helping us achieve unprecedented efficiency in data analysis and decision-making, but human oversight remains crucial in areas requiring ethical judgement.

The increasing impact of technology is also leading to new work models in the form of remote work and gig economy — creating a shift towards more flexible and inclusive labour markets. However, they also raise important questions about the need for worker empowerment and the adequacy of social protection, as these new models do not come with traditional employment benefits like healthcare and retirement savings.

Competency development

In this evolving world of human productivity, competency will be the currency. As traditional roles get disrupted, workers will need to consistently upskill and reskill. Lifelong learning must be embraced as a way of life. Those who embrace continuous learning will thrive in the future workplace. This is underscored by the Skill Disruption Index published by the Boston Consulting Group, which highlights the extent of transformation that job roles will undergo. There is an urgent need for upskilling and broadening our interdisciplinary capabilities.

The workforce of the future needs to possess a mix of domain expertise, technology skills, leadership acumen, and emotional intelligence to navigate the complexities of an increasingly automated and AI-driven world. For workers in the lower end of the value chain, as is the case in the gig economy, peer learning networks and avenues for credentialing skills must be created to ensure expertise is translatable to other opportunities and long-term career growth.

India’s digital public infrastructure

As countries navigate these shifts in the labour market, the development and integration of digital and open-source infrastructure remains equally critical as a tool for fostering inclusive growth. In India, we are leading the way with India Stack initiatives. Our public digital platforms such as UPI are not only promoting financial inclusion but also providing a framework for innovation and entrepreneurship. The iGOT Karmayogi is another platform that aims to democratise learning and improve the competencies of public servants, enabling them to remain adaptable to face future challenges. Other nations are now adopting similar digital public infrastructure at scale and leveraging their potential to drive economic growth and social welfare.

Policy and governance

To cater to these emerging needs, the role of policymakers cannot be overstated. It is essential that governments create frameworks that support both workers and innovation. This includes devising policies that encourage learning and competency building, ensure social protection systems are in place, and foster environments where new industries can thrive. One approach that could prove effective in navigating these changes is the application of the principal-agent theory to public sector governance. It addresses the complexities of delegation and accountability and can help policymakers develop new models of governance that promote transparency, adaptability, and impact measurement. We will require robust frameworks to evaluate how well programmes, platforms, and initiatives are translating to real-world growth and impact.

An invitation to reflect and act

It is imperative that we think critically about the impact of AI and Industry 4.0 technologies, geopolitics, and other drivers of change on the work ecosystem. New work models and lifelong learning will define the path forward, and policymakers must ensure frameworks are in place to support people in this transition. India’s technology leadership promises great potential for solutions, offering valuable lessons to the world.

This article is just the beginning of the conversation. For a more detailed exploration of the trends and possibilities, I encourage you to visit the ADBI website and read the policy brief that provides actionable insights for policymakers and other stakeholders to navigate the future of work in a technology-driven world.

The author is the chairperson, Karmayogi Bharat, and former CEO and MD, Tata Consultancy Services.

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