Last week I had the opportunity to speak at the 6th OECD World Forum (see accompanying blog) on the impact of digitalisation on the future of work.

Naturally given the Work Foundation’s mission, it is through the lens of Good Work that I came at the topic; exploring evidence and perspectives on whether digitalisation is likely to promote Good Work, and in particular Good Work for all. So what did I say on this subject?

Firstly technology, if deployed effectively, has huge potential to drive improvements in the workplace. As illustrated below, we could see new, smarter, more agile ways of working; enhanced management structures and practices; a stronger employee voice; better skills utilisation and development; increased productivity and wages; and improved work-life balance, workplace health and wellbeing.

What benefits could technology bring to the workplace?

So, the potential ‘prize’ that technology offers is great. But we are failing to realise these benefits.

We are failing to see widespread adoption and effective deployment of technology within most businesses. While the UK benefits from more technological pioneers, innovation diffusion – from the leaders to the laggards – is relatively limited. The UK is falling behind our international counterparts in how we use technology, in particular for purchasing, resource planning, people and customer management.

Further, we all know that the UK has a protracted productivity problem (read more in my previous blog on this); and that real wage growth has been stagnant over the past decade. Further, we also face growing issues at work: in-work poverty and under-employment, increasing work intensity and insecurity, worsening skill shortages, a lack of investment workforce development, a failure to deploy high performance working practices, and poor workplace health that undermines productivity and potential. 

Moreover, digitalisation won’t necessarily create Good Work for all

Those that lack basic digital skills – around 10% of the UK workforce – will miss out on the opportunities that technology brings. Further, studies by the OECD, McKinsey Global Institute and others highlight the disproportionate impact automation will have on the low skilled. That the jobs gained from the opportunities that technology presents will look very different, and will require very different skillsets, to those lost.

Automation will impact some sectors more than others and given differences in the make-up of local economies, the impact of technology will also be felt differently in different places. Indeed, the places that are less well equipped to respond to automation, could be those most likely to feel its full force; and hence digitalisation could very well exacerbate regional imbalances.

So what does this mean from a policy perspective?

The evidence points to the need for strong governance, a clear strategic framework, and an active, inclusive, and integrated set of labour market, skills and welfare policies that will maximise the opportunities and mitigate the risks that technology presents.

I had the opportunity to share some of the things we are trying in the UK, including the Industrial Strategy and Sector Deals; reforms to post-16 technical education and the (forthcoming) National Retraining Scheme; and emerging local industrial strategies, skills advisory panels and digital skills partnerships.

But despite these positive developments, we must go further to better understand the likely scale and impact of the megatrends driving shift in our economy. While foresighting exercises can never accurately predict the future, they are valuable in fostering a dialogue around potential outcomes, enabling different ‘actors’ to build resilience and adaptability; future-proofing planning and policy.

We must also go further to drive long-term, enduring, systemic change. The Industrial Strategy provides an organising framework for us to deliver a more ambitious, wide-ranging and coordinated approach – nationally and locally.

This will be vital to provide much needed stability in the policy environment; to unlock the potential for co-investment and long-term partnerships; to strengthen local ecosystems; and to inspire employer leadership and grass roots action. And only then can we deliver the targeted investment needed to ensure that people and places are not left behind.

About the author

Heather Carey

Deputy Director of the Work Foundation