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Will The Future Of Work Require More Investment In Technology, Not Less?

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Businesswoman checking robots with digital tablet in high tech company

In 2018 MIT created a “Task Force on the Work of the Future” to explore the way technologies are impacting the world of work, and how society can adapt to ensure that prosperity is broadly shared throughout. They aim to cut through the hyperbole that has sadly come to dominate this topic and give empirical, evidence-driven commentary.

The task force have recently published their first official report not with an express aim to provide definitive answers, but rather to help leaders and policy makers ensure they’re able to ask the right questions.

It begins by attempting to put to bed the various doomsday predictions that robots and other AI-driven technologies are going to lay waste to vast swathes of the labor market any time soon, whilst at the same time accepting that changes are inevitably afoot that need responding to, both from an individual and collective perspective.

A polarized workforce

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Technology has helped to create a polarized workforce, with the high-skilled professionals disproportionately helped by new technologies that have squeezed lower skilled workers. Unemployment figures clearly show that this has not resulted in a lack of jobs per se, but rather a lack of quality jobs that have resulted in many people working in precarious jobs with little in the way of security or quality of life.

“At MIT, we are inspired by the idea that technology can be a force for good. But if as a nation we want to make sure that today’s new technologies evolve in ways that help build a healthier, more equitable society, we need to move quickly to develop and implement strong, enlightened policy responses,” the authors say.

The report tackles head on the apparent dichotomy of low unemployment coupled with considerable anxiety among workers about their future. Technology is central to these concerns, with numerous surveys citing high levels of anxiety among people that their work is at risk from automation.

While these worries are more fueled by media-driven hysteria than reality, what is more grounded in reality are concerns around income stagnation, with the last few decades typified by poor wage growth for many people, leading the authors to posit that the biggest challenge is not to ensure work in general, but to ensure quality and well paid work is available.

“We think people are pessimistic because they’re on to something. Although there’s no shortage of jobs, the gains have been so unequally distributed that most people have not benefited much. If the next four decades of automation are going to look like the last four decades, people have reason to worry,” the authors say.

An equitable future

The authors argue that many of the technologies popular today have been ‘so-so technologies’, in the sense that they’ve improved the productivity of some (usually white collar) workers, but have had little impact on the remainder of the workforce.

Indeed, the digital wave typified by computers and the Internet have made educated workers more productive whilst making less-educated workers easier to replace.

The authors argue that the best antidote to the rise in technology is investment in skills, with a particular focus on community colleges that can help to facilitate a broader range of training and skills development.

Even with such investment however, they worry that it will be insufficient to create a more productive and economically secure labor market.

More technology needed

The report doesn’t really veer too much from other works on the topic, either in their concerns around the impact of technology or the possible solutions to them. One recent study that does present an alternative perspective is a German paper that looks at the root of inequality.

It argues that preventing the development and spread of new technologies will do more harm than good, and a more productive approach would be to try and reinvigorate the entrepreneurship of past generations that, they argue, underpinned a more inclusive form of economic growth.

Germany is in many ways a perfect Petri dish, as not only has inequality risen significantly since unification, they have also forgone the shift towards a finance-driven economy seen in Britain and the United States, and have seen few jobs outsourced due to globalization.

It’s also an economy whereby automation has generally created many more jobs than have been displaced. Yet inequality remains, and the researchers argue that the economy has saved to such an extent that investment in innovation has been strangled.

Boosting productivity

At the heart of their thesis is that we desperately need to increase productivity, not only as this makes organizations better, but doing so is likely to result in higher wages and a reduction in the anxiety the MIT report identified. Indeed, the German report highlights how productivity has fallen from 2.5% per year in 1992 to just 0.3% in 2013, with this resulting in the stagnating wages we’re seeing today.

What investments the country is making in technology is not proving especially effective, with innovations less likely to be commercialized than has been the case in the past. This is reflected in the poorer quality of patents, and the fact that just four German firms feature in the top 30 most innovative companies in the latest WIPO league table.

The expenditure is also concentrated heavily among larger companies, which is a problem faced by many western economies. This creates a significant productivity lag between big and small firms that would be greatly helped by better investment in technology.

Thus, the authors believe that far from the future of work being one where technology is something to be feared, it is instead beholden on us to increase our investment in technology to improve the inequality that undermines our confidence about the future.

It’s a conclusion shared by a recent report by the U.K. government into the role of automated technologies in the future of work. It argues that while care must be taken to ensure that the fruits of technology are evenly felt, the future requires us to invest more in technology rather than less.

“The UK’s low automation adoption is part of our lagging productivity, especially for SMEs, which is preventing a much-needed rise in economic growth, wages and living standards,” the authors say. “More co-operative ownership models, as well as greater employee engagement, stronger employment legislation and a fairer corporate tax regime are key to ensure public support for the benefits of a growth in automation, a rise in living standards and a fair economy and society.”

As previous industrial revolutions so aptly illustrate, new technologies provide tremendous advantages across society. That they cause short-term disruptions to parts of those societies is equally beyond dispute. If any lessons can be taken from the past however, it’s not that we should cease the wheels of progress, but rather help people to adapt to the changes in their circumstances.


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