Future Workplace Job losses will be compensated

It doesn’t take long to find studies on digitization and possible consequences for the labor market, with search engine hits on the topic stacking up one after the other – with varying results. For example, an investigation by Carl Frey and Michael Osborne from the University of Oxford comes to the conclusion that automation in the U.S. is a threat to 47 percent of all jobs. The study from 2013 has now been applied to Germany. According to its findings, the figure is even higher in this country with 59 percent of positions being at risk. According to the authors, the greater weight of industry in Germany is responsible for this difference.

But the search engines also provide completely different results. It is just as easy to find studies that predict a positive outlook due to digitization, and according to which a few hundred thousand new jobs will be created. So where does that leave us? The truth probably lies somewhere in the middle. Compensation mechanisms will take effect in the labor market: in the short term, there may be moderate job losses, but in the long term, these will be balanced out in my opinion. This assumption is also based on – you guessed it – numerous studies.

It is clear that some professions suffer more from automation – and others less. For example, activities that take place according to clearly defined routines are endangered. A classic example: In the logistics sector, employees carry out certain packaging and storage procedures according to predefined work instructions. Such work, such as the activities of pickers in order picking, could soon be taken over by more or less intelligent computer systems.

However, there are certainly opportunities resulting from digital technologies. In the area of IT, logistics, planning and engineering, for example, more challenging jobs are being created that cannot be taken over by a machine. At the same time, some difficult tasks will become easier: adaptive intelligent learning and assistance systems are a great chance to create career entry opportunities for workers who have been previously difficult to place.

The central point, therefore, is not the number of jobs lost, but qualitative structural changes in terms of activities and qualifications. In the broadest sense, IT competence is certainly gaining in importance – but only in combination with the respective specialist skills. By the way, it is nonsense that all people will have to be able to program in the future. What is decisive is the ability to make skillful use of the new technologies for the respective specific work situation. An example from industry: on the one hand, employees need to understand the physical process, but on the other hand, they will also have to know how to manage it and comprehend its potential uses in the future.

Management is not excluded from these changes incidentally. On the contrary, digitization will change their daily work routine massively. In industrial enterprises, middle management, such as operations managers or heads of department, are very heavily affected, because certain decision-making processes are being automated by new process and planning control systems. At the same time, more information is available to these managers so they can make decisions differently than before.

Also on the operational level, on the shop floor, many employees will have more knowledge and competencies than before – and this will flatten hierarchical structures. In the future, it will be increasingly rare that supervisors know more than their employees. That is why cultures of mistrust need to be dismantled. And it requires other guiding principles: more testing, less controlling.

However, it is doubtful that all managers are prepared for the changes caused by digitization. Large corporations such as Bosch and Siemens are highly sensitized to this development, but the metal or plastic business around the corner is not. Smaller companies operate under high cost and competitive pressure and do not have the necessary resources.