LAHORE: Artificial intelligence and other emerging technologies have enabled automation to scale posing legitimate workforce threats. But, automation is simultaneously creating and recreating jobs that may be the future of work.
The fear of getting jobless should be set aside because failure to adapt to new technologies would ultimately result in closure of existing low-tech enterprises and loss of jobs. New technology does uproot numerous jobs as many jobs could be performed by efficient machines without need of human workforce.
The products or services produced through high technologies would be of high quality and lower cost. This is the reason that amid the stoked fears of automation, discernible signals of the future are emerging and provide good reason to carefully analyse shifting tides.
Emerging firms are aggressively adopting leading technologies and deploying them in diverse and unanticipated applications. Tracing data footprints of these firms provides evidence of novel business models, new micro-industries, and increasing demand for the skills of the future.
Amid the stoked fears of automation, our entrepreneurs unfortunately are trying their best to generate income through obsolete technologies and the state is seen facilitating them through subsidies. In the second decade of this century for instance, when inefficient spinning mills were closing, many well performing spinners acquired these smaller failing mills adding thousands of spindles to benefit from the economies of scale.
They were also operating on aged technologies but managed through better management and the demand for Pakistani yarn was high in the global markets. Once the demand dwindled because competing economies acquired efficient technologies, these enterprises closed, having no buyers for their obsolete equipment.
In the process, the country lost almost one fourth of its spinning industry. Some mills have learnt their lesson and are upgrading technology; still over 50 percent of the spinners are operating inefficient spindles and surviving on the government subsidies. The high-tech textile industries also get the same concessions, minting money like never as they enjoy the dual advantage of upgraded efficient technology and the state dole outs.
The problem for the acquirers of new technology is that there are gaps between employers’ skill demand and worker skill sets. This calls for upgrading the skills of redundant workers to encourage new investment. Substantial public policies and programs are required to ensure that underrepresented groups are fully included.
Unfortunately, our planners have not yet started taking this problem seriously and the state-run skill training programs are still dominated by obsolete skills, which ensure the workers live in poverty forever. However, young generation on its own has started coming up with new innovative ideas.
The start-up ecosystem has gained substantial momentum this year and is beginning to demonstrate its capacity to support a mosaic of thriving, scaling, and nascent start-ups. However, the number of these young innovators is too small against the 220 million population of our country.
Some of these startups are providing employment to more workers than any large-scale industry. The policy makers should anticipate changes in employment demand as technology-enabled growth increases.
Currently, the clusters of start-ups are limited to only three cities; Lahore, Karachi, and Islamabad. Even these innovation clusters are not permanent, and failure to adapt ecosystems to respond to innovations may herald a painful decline.
An economic expert once said that Detroit’s mistake was not the failure to stop the demise of jobs in auto manufacturing, but the real mistake was its failure to redirect its ecosystem into something new when it still had an ecosystem.
We have seen rapid deindustrialization in Pakistan. Many smaller cities have clusters of the same type of industries and have been denuded of those clusters. The entrepreneurial ecosystem is still there.
The state and entrepreneurs need to ensure that the ecosystem remains intact, providing room to a new start with innovative technology. Innovation is volatile and this volatility must be addressed through prudent policies.
It’s estimated that one new tech job creates five additional jobs. This is two-pronged job creation process: two of the newly created jobs will be tech positions, but the remaining three will be service-oriented jobs.
Tech jobs provide a distinct income advantage. However, the three service-oriented jobs may not be as attractive; these will be a combination of high-wage, high skilled service positions, and low wage, low-skilled ones. The major challenge is to ensure that these low wage jobs go to the existing army of unskilled workforce.
If the innovation culture that has just started in our country multiplies in future, we will be adding millions of service-oriented jobs. We have already seen that startups like food Panda and grocery suppliers have engaged many semi-skilled workers to provide services to their clients. The delivery of goods through ecommerce orders has also added numerous jobs. The industrialists should also scale up their technologies to survive in the market.
