Will you thrive in the Fourth Industrial Revolution?
“Technology is raising a host of questions about the future of work, but one thing is clear: successful organisations will have adaptability at their core.”
- Professor Lynda Gratton, London Business School
Emerging technologies, socio-demographic shifts, and political and economic uncertainties are already dramatically reshaping the way we work. This will have profound implications for the future workforce.
Yet, our research here at QinetiQ suggests many organisations are woefully underprepared for the impact of the Fourth Industrial Revolution.
What’s behind this major workforce shift?
We have identified and researched a host of coalescing factors which are driving changes in work patterns, employee behaviours and the labour market. These can be broadly summarised as:
1. Emerging and disruptive technology trends
Technology is changing the nature of work beyond all recognition.
From ‘Big Data Analytics’ and ‘The Internet of Things’, to advanced manufacturing and materials and artificial intelligence (AI), the move towards 4IR is accelerating at pace.
According to a report in The Times earlier this year, between 2000 and 2010, of all the jobs lost in the US, over 85% were lost to robots.
Much of this new technology, particularly automation and AI, is, of course, driven by business efficiency and cost-savings. Technological changes are now increasingly focused on substituting rather than enhancing people in the workplace to drive down labour costs.
SMEs that are embracing these technologies as innovation for future economic growth are now highly attractive to talented people. Conversely, many traditional corporates, manufacturers and government employers are now seen as cumbersome, constrained by both inertia and bureaucracy.
2. Demographic and skills trends
As well as these technological changes, concurrent social, demographic and economic factors are reshaping the way people are either electing, or being encouraged, to live and work. Predictions in this area vary, but for the UK labour market, include:
- UK Government research suggests that by 2030, the workforce will be older, multigenerational, increasingly international and with a higher proportion of female employees.
- The Economist Intelligence Unit points to increasing growth in the ‘gig-economy’ driven by transient, on-demand or crowd-sourced labour models.
- The Chartered Institute of Personnel Development forecasts that unless employers change their approach to workforce planning, a ‘demographic time-bomb’ will leave them facing severe skills shortages over the next 20 years.
- Business in the Community predicts a recruitment ‘black hole of 7.5 million’.
- Employers continue to report skills shortages in all areas of STEM (Science, Technology, Engineering, and Maths).
Further, there will be an increasing need for the more human skills – empathy, creativity and team-working – as automation and AI displace many STEM roles.
Together, the changing nature of work patterns, ageing workforce and new skills requirement represents a major challenge for workforce capability planning.
3. Political, economic and social trends
Recent events in the UK only serve to underline the enormous levels of political upheaval over the past two decades. Traditional economic and policy agendas have been overtaken by the rise of populist agendas, fuelled at least in part by social media and ‘fake news’. Political instability now appears normal.
New global business models are a further challenge to the ability of governments to control their indigenous labour markets. Technology and flexibility of employment also create opportunity for wealth creation across international boundaries, with the potential for local tax revenues to fall despite employment increasing.
Therefore, traditional economic and social models no longer satisfy the need to plan effectively as 4IR technologies become mainstream. All the indications are that political and social factors will continue to drive profound change.
What will the future workforce look like?
There is a general lack of consensus about the impact of the Fourth Industrial Revolution on the labour landscape. Some predict catastrophic unemployment as jobs are 'hollowed out' and automated. Manual tasks will fall victim to automation, more complex tasks will be replaced by AI. Many traditional job roles will simply cease to exist.
Conversely, The Bank of England foresees a less turbulent scenario. In their forecasts, the types of employment available will change as new jobs are created to compensate for those lost.
In both scenarios, however, there is an agreement that the labour market will look considerably different to the one we see today.
We believe the marriage of disruptive technologies with a desire for flexibility is giving rise to alternative employment models. We see the labour market polarising into two distinct groups:
- A bulging low-skilled, low-wage workforce
- A high-skilled, high-wage, technology-literate workforce.
From our research, we have concluded that this polarisation requires a totally new approach to developing future workforce capability. An approach that can deliver an inclusive win-win-win for organisations, their employees and the wider economy. There is no doubt those organisations who do not adapt will struggle to thrive. Some may not survive.
How can organisations benefit from 4IR?
Ultimately, labour market planning must be informed by a detailed understanding of the Fourth Industrial Revolution. Harnessing emerging technologies and understanding socio-demographic, economic and political trends is vital to succeed in this new era.
For governments and employers alike there is a need to future-proof the workforce by ensuring critical skills are available now and for the next 10-20 years. This is only possible through:
- Scanning strategic trends
- Anticipating the potential ‘future of work'
- Long-term capability planning
- Resilience against a range of possible scenarios.
We have been working with our colleagues across QinetiQ who have considerable expertise in these areas.
In addition, we can help organisations directly to address their short-term capability requirements and become an employer of choice. By addressing the challenges of the multi-generational workforce, revising organisational structures and upskilling and reskilling, employers can develop an employee value proposition that helps attract the best available people.
The Fourth Industrial Revolution presents challenges for government, employers and employees alike. By harnessing the opportunities available, it really is possible to thrive in this new economy.
If you would like to know more about our vision for 4IR, please contact Freyja Lockwood: email@example.com
Freyja Lockwood is a chartered Human Factors consultant who brings a people-centred perspective to technology-driven change, organisational development and the ‘future of work’. She is investigating how disruptive technology and changing business models are fundamentally re-shaping the nature of work. Freyja is also involved in bringing the people agenda to the forthcoming updates to the Global Marine Technology Trends 2030.