Your services are no longer required (Part 2)

The real skills crisis we are facing is how we keep ours relevant as we live longer and robots get smarter

What adjustments do we need to make when our traditional educational paradigms and job designs no longer appear feasible? We examine some ideas in this conclusion to “Your services are no longer required (Part 1)“.

“When thinking about the skills that will be needed in the future, it is easier to define what jobs won’t be around, than what will,” says Frank Levy, an economist at MIT and Harvard Medical School. He cites the example of coders in US hospitals, who read reports by radiologists and translate what they have done into billing codes for insurance companies. “With speech recognition, that job will get taken away,” he says. “The key risk is jobs with a lot of structure or repetition.”

Concerns about the effect of these changes extend beyond employers or governments. Bill Gross, who ran the largest bond mutual fund in the world, Pacific Investment Management’s $270 billion Total Return fund, and now works at Janus Capital, recently wrote a 21st century echo of US President Lyndon Johnson’s 1964 panel study on automation and economic progress. “Technology and robotisation are changing the world for the better, but those trends are not creating many quality jobs,” he told investors.

Gross called for a universal basic income, rather than wasting money on more education, to address the jobs vacuum: “Retraining and education sound practical and are at the head of every politician’s promised ticket for the Yellow Brick Road, but I doubt much of it will be worth the expense. Four years of college for everyone might prepare them to be a contestant on [TV quiz show] Jeopardy! but I doubt it’ll create more growth.”

A career of several careers

Few are as pessimistic as Gross, but many believe the skills people need for work, and the way they acquire them, will need to change radically. They will have to adapt constantly rather than making a single choice of career in their twenties.

Udacity, a Californian further education company founded by Sebastian Thrun, who previously ran Google’s self-driving car project, could be a sign of things to come. Udacity builds on the online learning movement pioneered by the providers of “massive open online courses” such as the Khan Academy. It provides online videos in technology and software skills, which have been watched by four million people in 168 countries, but also offers 6-month “nanodegrees”.

People pay $2,400 for these in subjects such as programming for the Android mobile operating system, taking regular assessments that are marked by mentors. Shernaz Daver, Udacity’s chief marketing officer, says the average job in Silicon Valley lasts 18 months, compared with 4.6 years in the US as a whole. “It is no longer a case of going to college for four years and then you’re done — you must keep learning.”

There are many who face even more profound changes than updating their vocational skills. Mark Beatson, chief economist at the CIPD, points out that careers shortened in the post-war era, with many people retiring in their early fifties, but that human longevity will reverse that trend. “My grandfather went down the pit at 14 and came up at 65 to retire, so his working life was 50 years. That will become more common again,” he says.

Rather than having one job for 25 or 30 years, and gradually tailing off or moving to a related occupation for another decade or so, people may need to retrain for a career in another industry or profession. That kind of disruption, requiring a fundamental re-skilling mid-career, may put a greater onus on individuals or governments to extend education. “Employers may find it hard to justify big investments in individuals with limited payoffs,” says Beatson.

Finding the human advantage

One crucial, and as yet unknowable question is which skills are likely to remain in demand, or become more valuable, in coming decades. Some studies have suggested that many jobs could be displaced by technology. Carl Benedikt Frey and Michael Osborne, two Oxford University economists, estimated in a widely cited 2013 study that 47% of total US employment could be affected by automation.

The key word there is “could”. Frey and Osborne created a model for roles, identifying how much a job relied on perception, manipulation, creativity and social intelligence. They then asked whether, in the next 10-15 years, technology would be able to automate the mix of skills required for that job. Whether that happens depends on the choices firms make.

Other economists counsel against such pessimism. For a start, as Levy suggests, it is easier to envisage occupations that will be automated than to dream of roles that might yet be created. Some of the suggested jobs of the future sound absurd — how many people are likely to find work as data hostage negotiators? Yet let’s remember that 20 years ago, few would have predicted the advent of app developers, Zumba instructors or user experience designers.

The optimists maintain that even AI programs require a structured environment. They cannot improvise, or set new rules for themselves, in the way humans can. “Once you are out of the laboratory and in the real world, a lot of the computer’s advantages disappear,” says Levy.

That might shield mid-level technical skills for longer than is usually forecast. A medical technician, for example, combines mathematical and analytical knowledge with physical dexterity and an ability to empathise with humans. A computer can learn a language, but to acquire the emotional sophistication and sensitivity that has evolved in humans over millions of years is a challenge of a different magnitude. This could slow the hollowing out of jobs.

The bigger issue is to identify the skills that computers will not be able to match, at least during the 21st century. These roles will involve intellectual reasoning and social and creative skills — intuition, critical thinking, persuasion, abstract thought and, crucially for those working in professions such as HR, the ability to apply ethical judgement.

Tracey Wilen, a former technology executive and visiting scholar at Stanford University, says there will be a greater premium on novel and adaptive thinking — the ability to work with machines to create new, more efficient methods of doing familiar things. She believes companies will value people who are “T-shaped” — who have a deep expertise in one area, and a set of broader skills. “We have specialists, but the next wave will be people who know about technology or finance, but also have broader abilities.”

So the existing emphasis on STEM (science, technology, engineering and maths) qualifications may become outdated. “It was very valuable in the 19th century to know how to use a pen, but that soon became universalised,” says Andreas Schleicher, OECD Director for Education and Skills. “The skills that are the biggest differentiators today are creative thinking and analysis — transferable skills that are not specific to one job.”

Toby Peyton-Jones, Siemens’ UK Human Resources Director believes that breadth of education — the range of analytical, as well as technical, subjects taught in the International Baccalaureate, rather than the narrower British A-level qualifications — will become crucial. He cites the value of “meta-skills and meta-thinking… higher-level thinking skills, not by themselves but combined in people who are multilingual and ambidextrous, globally connected, open-minded. They will be the most valued employees.”

Who bears responsibility for re-skilling?

This also indicates that education itself needs to be rethought. “If routine cognitive skills are less important, sitting in a classroom and having a teacher tell us something is less useful,” says Schleicher. “What to learn and how to teach it are intertwined, the curriculum has been adapted in many countries but this has not been translated into the learning environment.”

Levy says education will need to be delivered through project work, not passive lessons. “You don’t want to just learn formal technique from a blackboard, you want to know how to apply it in unpredictable situations. The more routine the instruction, the more it could be learned by machine. Would you feel comfortable with a doctor who had never dealt with a patient?” This approach, combined with longer lifespans and more uncertain careers, will blur the boundaries between academic education and vocational training.

If people need to re-educate themselves mid-career, whose responsibility is that and who will fund it? Individuals may find it too costly to take a prolonged career break — two years or more — to retrain. Will they need to release money from their property, savings or pensions to finance this? (Obviously, if individuals work in the “gig economy”, keeping their skills relevant is a responsibility, and a cost, they are expected to bear.)

What share of this burden will employers want — or have — to take? And, given current concern over growing social divisions, does it make sense for governments to invest in this process, as Johnson’s panel recommended back in 1964?

In Silicon Valley, the idea of a universal basic income has become a fashionable obsession. Start-up accelerator Y Combinator is experimenting with this idea with about 100 families in Oakland, California. As this edition went to press, Switzerland was due to vote on whether to give every citizen $30,000 a year. Similar schemes have been mooted in Ontario and Finland.

Interviewed in WIRED magazine last year, entrepreneur Martin Ford, author of Rise Of The Robots, said: “My proposed solution is to have some kind of guaranteed income that incentivises education… The problem with many of the businesses you can start online today is it’s hard to generate a middle-class income. Giving people an income floor might help them pursue those opportunities and push us toward more entrepreneurship.”

No matter how productive machines become, it is hard to predict whether societies will want to pay individuals a universal basic income, encourage retraining or try a bit of both. Whatever the solution, as the delegates at a recent OECD Policy Forum on the Future of Work all agreed, employers, employees, governments and training providers will need to work together.

The idea that robots may replace us — in the workplace and later on Earth — is a recurring theme in science fiction. Yet, ultimately, humanity must choose how much automation is desirable. Our ability to reinvent ourselves — our skills, our thinking and our institutions — could prove invaluable as we face the most profound social challenge since the Industrial Revolution.

This article was first published in the Summer 2016 issue of the CIPD’s Work. magazine.

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