White Paper

With the Internet of Things, or IoT, we’re at the dawn of a new revolution, which could be compared with the digital wave that disrupted most industries not so long ago. For although digitalisation clearly created immense value for consumers, it was also very tough on companies unable to adapt quickly enough. So, how can we generate value in this new game? The Internet of Things is everywhere. Wearables, or portable technologies, and other health-related accessories are among the first to come to the fore, such as bracelets, watches, bathroom scales, and others, with Fitbit, Jawbone, Withings, and iWatch. Objects like cars, tractors, suitcases, fridges, garbage cans – even the human body – are getting connected. Yet machine-to-machine (M2M) interfaces are nothing new: they’ve been around for over two decades. So, what has changed? Significantly lower sensor costs, an explosive rise of connectivity, increased computing processor power, and miniaturisation of these components are all factors that augment innovation opportunities and hence the range of connected objects.

The first part of the Report on the Future of Prime Minister Juha Sipilä’s Government builds a shared understanding of the future of work. The report looks for answers to broad questions exploring the future of working and provides information on the consequences of the changes that are taking place. The transition of working life is perhaps the greatest challenge for Finland, and there is no single, simple solution to it. In this transition the traditional links between growth, productivity and wellbeing may be broken. The consequences for the society may be quite dramatic, but the changes will take some time to happen – the work of the future is characterized by diversity and continuous change over longer periods of time. The report raises questions concerning the social policy of the future and opportunities that we should grasp already today. The key questions are concerned with how the transition of work changes the traditional link between work and earning a living and the regularity, coverage and functioning of the social arrangements and safety networks that support this, while also offering additional impetus and significant opportunities for new forms of organization and self-employment, platforms, sharing economy and joint providership. As the borders between employer and employee, provision and consumption, working and non-working, and entrepreneurship and paid employment are fading, this changes many of the key social structures, including tax base and the customer base of the social security system, and pressures are created to reform the competence base, legislation, and the role of trade unions and protection of interests. The advancement of technologies treats different types of tasks in very different ways and at a different pace and the resources of the labour force are highly varied, which means that there is a risk of growing inequality in working life and on the labour market. These questions take us towards the second part of the report, which is concerned with building solutions and policy choices. The second part of the report will be published in summer 2018.

Proposal: I seek this Committee’s in-principle agreement to establish a legislative system that allows employers and workers to create Fair Pay Agreements that set minimum employment terms and conditions across an industry or occupation. This in-principle agreement is subject to further consideration by Cabinet once I report back with advice from an expert advisory group on the scope and design of a Fair Pay Agreement system.

This paper expresses Knoll’s perspective on trends shaping the future of work and the workplace. It includes our research and that of others in an effort to illustrate a broad view of the future and the trends affecting the workplace. We discuss six macro business, social and technology trends, followed by the implications of these trends on real estate and workplace strategy and implementation of workplace design.

"Sets out to illuminate the diverse and intersecting trends driving change in Canada’s labour market. These trends have the potential to influence future skills demand in either positive or negative ways—and sometimes both. This report is not a prediction of the future or a deep analysis of any one trend, but instead reveals a complex picture. It aims to spark exploratory and imaginative thinking, and push readers to ask themselves “what if?” What if Canada sees a rise in wildfires, floods and mudslides? What if cases of mental health issues associated with technology use continue to multiply? What if AI becomes capable of performing creative tasks? This report explores 31 broad trends such as these, while imagining the possible implications for Canada and its labour market in the year 2030 and beyond. The goal of this report is to challenge leaders from all sectors—including policymakers, educators and employers—to cast their net wide when considering multiple trends, from the weaker signals of change to those that are in the limelight. This also includes contemplating the potential for different trends to interact in ways that are not always so obvious. This work builds on earlier research by our project partner, Nesta, which outlined seven mega trends impacting the future of work, including: technological change, globalization, demographic change, environmental sustainability, urbanization, increasing inequality, political uncertainty Turn and Face the Strange extends this framework of mega trends to explore the dynamics of 31 related trends, some of which are mature, while others are emerging or speculative. This report is the first of several that will be shared as part of Employment in 2030, along with open data, interactive infographics and blogs. It is meant to inform a conversation about the range of changes at play, and to provide a starting point for our expert workshops taking place across Canada throughout the spring. During the workshops, experts with a broad understanding of the Canadian labour market will be asked to forecast how demand for specific occupations is likely to change, based on their understanding of how various trends – including those highlighted in this report – might impact future skill demand. Learn more about the Employment in 2030 project in its entirety."

The new wave of technological innovation is expected to fundamentally change the future of jobs. The debate on the impact on jobs, however, is controversial. Some expect a jobless future, while others argue that history will repeat itself, and new technologies will eventually create new and better jobs. This research aims at a better understanding of the dynamics of job destruction and job creation. The paper develops a framework to explain the nexus new technology, innovation and job, and the forces driving labour-saving as well as job-creating innovations. Technological change is explained as a nonlinear and complex process which comes in waves and different phases, and market, social and political forces are driving the dynamics of job destruction and job creation. The paper firstly explains the role of market forces in driving automation and fragmentation as two forms of process innovation that destroy jobs in industrial production regimes. Secondly, markets also create jobs by adjusting to increased productivity and jobs losses. However, due to country-specific social capabilities the net impact on jobs differs significantly across countries. Finally, this paper explains the long-term process of moving towards a golden age of job creation. Such a phase of massive job creation can only be achieved by transformative changes in the economy where radically new products and new growth industries emerge in a process of creative destruction. Such changes cannot be generated by markets, they are a social and political choice. The paper argues that unintended consequences of past technological changes have disruptive effects in societies and natural environment which trigger social debates and movements, societal learning processes, and eventually, new social and political demand and new capabilities. It is this social transformation that propels transformative structural changes in the economy and massive job creation. This paper concludes that technological change and the future of jobs is not deterministic but needs to be shaped. Both, market adjustment and societal learning processes drive endogenously the job-creation dynamics. The challenge for public policies is to foster the dynamics of societal learning and economic transformation.

What are the prospects for long-run economic growth? The present study looks at a recently launched hypothesis, which I label Singularity. The idea here is that rapid growth in computation and artificial intelligence will cross some boundary or Singularity after which economic growth will accelerate sharply as an ever-accelerating pace of improvements cascade through the economy. The paper develops a growth model that features Singularity and presents several tests of whether we are rapidly approaching Singularity. The key question for Singularity is the substitutability between information and conventional inputs. The tests suggest that the Singularity is not near.

About 40% of employment in manufacturing is in services functions. This paper develops a measure of narrow outsourcing, matching services functions performed by workers inside manufacturing firms to the same services functions provided by outside suppliers. The measure allows us to analyse the competition that, say, workers at the IT services desk in manufacturing firms face from outside IT suppliers. Narrow outsourcing is entered into labour demand functions where labour is broken down on business functions using OECD data combined with the 2016 releases of the World Input Output Database (WIOD). On average, a one percentage point increase in narrow local outsourcing of services reduces manufacturing employment in the same services function by between 1.5% (R&D) and 3% (transport). The impact of offshoring on manufacturing labour demand is small on average but depends strongly on the complexity of the value chain, the policy environment and technology. Manufacturing employment is more services intensive the longer the value chain. In-house IT functions complement and support offshored IT functions, while offshored R&D functions tend to replace in-house R&D. Tentatively, technology as measured by IT maturity and the length of the value chain is more important for employment in services functions in manufacturing than is offshoring.

The Productivity Commission aims to provide insightful, well-informed and accessible advice that leads to the best possible improvement in the wellbeing of New Zealanders. We want to gather ideas, opinions, evidence and information to ensure that this inquiry is well-informed and relevant. The Commission is seeking submissions on the questions contained in this paper by 5 June 2019.