More on digitalisation and skills: What happens within occupations?

By Guillermo Montt.

Blog36.0Much attention has been given to the extent to which technology will replace workers. Some alarming estimates point to a large share of jobs at risk of being automated. By focusing only on the unlikely scenario of massive job substitution, the discussion on technological change, jobs and skills has ignored the more plausible scenario of how technological change will continue to impact existing jobs.

David Autor (2015) asks why, in the context of the rapid technological change and continuous threats of unemployment, we continue to see the employment rate rise. While indeed some jobs disappear and others appear as a result of technological change and its indirect effects, most jobs actually change and adapt. Take the example of the cash register. The proliferation of the cash machine (usually known as an ATM, ABM, Cashpoint or Bankomat depending on the country) ignited anxieties over the displacement of cash registers as machines were able to perform the job of a cash register faster and more reliably than a person. But cash registers did not disappear; in the US there are, in fact, more people employed as registers than before the ATM machine. What happened? The job evolved. Human cash registers perform fewer of the routine tasks that were automated and more of the financial advisor / socioemotional tasks that are hard to automate.

As technology enters the workplace, the tasks related to a job and an occupation change.  Alexandra Spitz-Oener (2006) finds that in Germany, occupations in the 2000s require more complex skills than in 1979 and that this change is more pronounced in occupations that adopted computers.

James Bessen makes a similar point in his recent book Learning by Doing: The Real Connection between Innovation, Wages and Wealth. He follows the evolution of occupations over time and claims that accelerated technological change has implications for inequality within occupations with more and more occupations growing in inequality because workers do not have access to on-the-job learning opportunities or unequal ability to upgrade skills on the job (Bessen, 2016). Jobs related to the graphic industry have adapted and changed in this way: before the computer, the graphic design occupations were largely jobs for typesetters and compositors. With the advent of computers – but still print-based publishing – jobs were largely for print designers and desktop publishers. Jobs in graphic design then shifted to web design and now to mobile design. Jobs in graphic design – like many other occupations – have adapted and changed their skill requirements.

Bessen argues that what is special about technological change today is the speed of change and the speed with which standards change. Keeping with the example of the graphic design industry, three years ago the standard was Flash. Top designers used Flash and needed to design in and for Flash. But as technology evolved, the standard today is HTML5. Designers need to adapt. Quickly. And given that the speed of change is so great, designers cannot resort to education and training institutions that are slow to react.

Only workers who are able to teach themselves and adapt keep ahead of the curve. Bessen argues this is – at least in part – at the root of increasing inequality within technology-rich occupations. In occupations requiring above-median computer use, the 90th to 50th percentile wage ratio has risen by 0.2% per year but has remained stagnant in occupations with below-median computer use. Workers who stay ahead of the curve, those who learn by doing, reap the wage benefits of technological change.

These trends point to important implications for how we conceive an education and training system that is relevant for labour market needs. The OECD’s work on skills seeks to generate more and better evidence to enhance the relevance of skills development programmes.  These trends also speak to the importance of understanding what happens to those jobs that remain in the labour market, not only in relation to technological change, but also globalisation.


2 thoughts on “More on digitalisation and skills: What happens within occupations?

  1. Thank you for this information Glenda. You mention that workers who “stay ahead of the curve” are those who learn by doing and who teach themselves. It is this group which reaps the wage benefits of technological change. I’m curious about how you compile research on these people and track them if they are not in official learning establishments.


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