Upskilling is a conventional means for increasing employability and salary. Through on-job training and experience, people keep upskilling themselves. Hence, they deserve a salary increase every year. This appears to be a continuous process. But if technology progression in the form of robotics and automation causes net job loss in a particular occupation, making some positions redundant, how will upskilling help? On the other hand, technology progression is also demanding less skill for the same positions. Organizations are taking advantage of technology for transferring experience earned Tacit capability in the form of policies, procedures, standards, and reusable knowledge assets. Due to robotics, it’s also happening in the manufacturing industry. Hence, the market value for the experience or upskilling is falling. Due to this effect, already an implication in the name of ‘juniarization’ is surfacing in the corporate world. Does it mean that automation and robotics are blocking upskilling?
This is a tectonic shift in the workplace due to technology. The unfolding reality contradicts the belief and suggestion that the workforce must learn new skills and competencies required for new and changing jobs due to technology. For example, technology up-gradation in manufacturing and service is not demanding upskilling. In many cases, next-generation technology solutions are far easier to handle than previous ones. For example, semiautomated or digital sewing machines are far easier to operate than their mechanical counterparts. Let’s look at our mobile phones or computers. Are they asking for more skills to perform? Such reality is demanding us to have far greater clarity to assess whether automation and robotics are blocking upskilling.
Wall Street has triggered “juniorization” to spread
America is known for spreading many new trends. From railroads, automobile to lightbulbs, the list is endless. “juniorization” is a new trend. Eventually, the ripple effect will be felt all across the world. This phrase refers to “the practice of firing senior traders and salespeople and replacing them with younger talent.” In plain and simple terms, experienced staff gets pushed out of the workforce, replaced by younger, less expensive people. As technology has become a cheaper option to capture experiences as organizational assets, the market value of experience people evaporates.
For instance, “Goldman Sachs increased its number of analysts, associates, and vice presidents by 17% from 2012 to 2015”, as business insider reports. On the other hand, it has reduced the number of partners and managing directors by 2%. As trading becomes more electronic, bots, as opposed to traders, gather and provide intelligence to trading decisions. Subsequently, older traders find their experience increasingly less useful to add value.
Banks are spending billions on upgrading technology, not only to automate mundane and tedious work. On the one hand, such automation is reducing the work of entry-level professionals. On the other hand, automation is capturing the experience in the form of data analytics algorithms, policies, changes in procedures, and updating standards of output. For instance, JPMorgan’s digital deal-making using machine learning saves thousands of hours of work in the process of underwriting stocks and bonds. Similarly, Goldman Sachs is stripping out half of the roughly 130 steps in the process of initial public offerings and delegating them to computers.
Manufacturing is not immune to “juniorization”
A few hundred years ago, high skilled artisans used to produce industrial products. Even 70 years ago, high-end technicians used to make automobiles. Over the centuries and decades, the scenario has been changing. It started with Adam Smith’s job division and specialization and Frederick Taylors’ production line concept.
In the 18th century, Adam Smith introduced the concept of job division and specialization. For instance, a pin-making job was divided into 18 distinct steps, resulting in less skill need and higher productivity. As a follow-up to it, at the dawn of the 29th century, Frederick Winslow Taylor introduced the assembling line concept in automobile production. Subsequently, it opened the entry of low skilled workforce in manufacturing as it reduced the skill requirement. However, upskilling was needed as many people working in agriculture started to migrate to manufacturing.
The job division and assembly line concept kept moving further in the middle of the 20th century. Machine designers started investigating knowledge and skill requirement in performing each task by human workers. Based on capacity needs, they divided each task into three major sub-tasks. The first one carries high-level Codified Knowledge and skill, followed by the 2nd type sub-task requiring high-density experienced-earned capacity. The 3rd category sub-tasks require mostly innate capabilities. Upon succeeding in such further task division, machine designers started developing machine capability in performing those sub-tasks, giving birth to automation and robotics.
Automation and Robotics are also blocking upskilling in manufacturing
Initially, they targeted those sub-tasks, like spot welding, which required mundane physical capability. Upon automating them, they started automating tasks requiring codified capability earned through education and training, followed by automating experienced earned tacit capability. Subsequently, leaving behind only tasks requiring innate abilities. As a result, the human role has moved from being in charge of production to supporting machines to manufacture. Hence, the scope of addressing job loss or increasing the market value of experience through upskilling is also being blocked by automation and robotics. However, the complexity of automating innating abilities is extremely high, resulting in the cancellation of ASIMO and the stalling of autonomous vehicles.
Net job loss and automation of codified and tacit skills are reducing the scope for upskilling
On the one hand, automation and robotics reduce the codified and even experience earned tacit, capability, and performing tasks. On the other hand, it is also reducing the net demand for labor. Hence, experienced people are suffering from job loss. Besides, entry-level positions are disappearing. We have already reached a situation where the net effect of robotics and automation on labor demand is negative. Under this situation, what is the relevance of upskilling should be looked upon from different perspectives?
Human beings qualify for jobs, and also increase their market value with experience, through different means. The first one is their innate ability. They apply many of the 52 innate abilities in performing tasks. The quality of these by-born abilities varies from person to person. These inherent virtues can be sharpened to increase the market value of humans in the job market. They improve their eligibility through the acquisition of codified knowledge and skill, mostly through education and training. They also keep increasing their market value by acquiring knowledge and skill through experience, in implicit form. Automation and robotics are finding it quite easy to take over codified capability. They are now progressing to automate also tacit capability, giving birth to “juniarization” concept. It seems that machine designers find it quite complicated, perhaps not impossible, to automate innate abilities.
Automation and Robotics blocking upskilling—how to resound?
Instead of requiring more skills, our productive activities are rather asking for less of it. Such reality appears to be in contradiction to common perception. Hence, to respond to technology-led transformation, the scope of upskilling to increase employability or retain experienced people in jobs has been shrinking. On the other hand, we cannot slow down the advancement of technology as we need to keep progressing to produce more with less.
To address it, should we focus on sharpening innate abilities, in addition to offering additional codified capabilities? Will it empower job seekers as well as already employed people to increase their comparative advantage over machines? Will it make it harder for machine designers to imitate them? It seems that we need to empower human beings to be in charge of work, as opposed to supporting machines to perform productive activities.
How to reverse the trend of diminishing market value of humans in the workplace has been a core issue. Otherwise, the conventional belief and approach run the risk of failing to address it through upskilling. Both theory and empirical data suggest that the impression of automation and robotics blocking upskilling is real. How to respond to this reality should be a serious subject of investigation and Innovation. In fact, such an investigation is vital to address the future of work issues in the age of the Fourth Industrial Revolution.
