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The Impact of New Technologies on Labor Markets: Insights and Challenges, (from page 20250831d.)

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Summary

New technologies, including robots and AI, are transforming labor markets by displacing, augmenting, or creating new tasks. In East Asia and the Pacific (EAP), robots are primarily displacing routine manual jobs, leading to regional vulnerabilities. Despite job displacement, robot adoption may increase overall manufacturing employment, benefiting skilled workers more than low-skilled ones. AI’s impact, while not fully assessed yet, is expected to affect both job displacement and augmentation; however, EAP jobs are underexposed to AI benefits compared to advanced economies. Mechanization in agriculture does not significantly displace labor, while industrial robotization has led to a rise in manufacturing employment. Digital and advanced technical skills are necessary to adapt to this changing job landscape. Additionally, labor mobility issues call for social protection schemes for gig workers, as evidenced by various initiatives worldwide to broaden access to social insurance.

Signals

name description change 10-year driving-force relevancy
Displacement of Industrial Workers by Robots Robots are increasingly displacing manual labor in industrial sectors. Shift from human manual labor to robotic automation in industrial jobs. Industrial sectors may see a predominant use of robots for various manual tasks. Advancements in robotics technology and cost-effectiveness of automation. 4
AI Displacement into Nonroutine Jobs AI is beginning to affect nonroutine cognitive tasks and services jobs. Transition from human roles in nonroutine jobs to AI-driven tasks. A significant portion of nonroutine jobs might be automated through AI. Development of AI capabilities to handle complex cognitive tasks. 5
Creation of New Job Tasks due to AI and Digital Platforms Emerging roles like AI-prompt engineers are a response to technological advancements. From traditional job roles to new specialized roles created by technology. Job market will feature roles closely tied to technology advancements and AI. Need for skilled workers to manage and implement new technologies. 4
Vulnerability of EAP Countries to Robotics Displacement EAP countries may face more job losses due to reliance on manual tasks for employment. Shift from a manual labor workforce to robot-dependent industries in EAP. EAP countries could see a dramatic reduction in manual labor jobs due to automation. Economic feasibility of robotic technology in developing regions. 4
Digital Skills Demand Rising Growing necessity for digital skills to compete in emerging job markets. Shift from traditional skills to digital proficiency requirements. A workforce predominantly skilled in digital competencies may emerge. Increasing digitalization across industries demanding skilled labor. 5
Social Protection Needs for Gig Workers Gig workers are seeking better social insurance and protections. Transition from sporadic gig work to more structured support systems. Enhanced social protection frameworks for gig and informal workers may be established. The increase in gig economy jobs necessitating safety nets for workers. 4

Concerns

name description
Job Displacement Due to AI and Robotics AI and robots are displacing workers in both routine and nonroutine tasks, threatening job security across various sectors.
Vulnerability of EAP Labor Market Countries in the EAP region are more susceptible to job displacement by robots, affecting low-skilled workers more significantly than skilled workers.
Economic Viability of Technology Adoption Adoption of new technologies depends on whether the economic benefits outweigh the costs, potentially leading to unequal impacts on job availability.
Digital Skills Gap There is a significant gap in digital skills among workers, limiting their ability to adapt to an increasingly digitalized workplace.
Inequality in AI Exposure Women and better-educated workers are more exposed to AI impacts, potentially exacerbating gender and educational inequalities in the labor market.
Gig Economy and Social Protection Needs The rise of gig work is creating a pressing need for social protection schemes for workers outside traditional employment systems.
Market Failures and Labor Mobility Restrictions Poor information and rigid labor market institutions hinder labor mobility, negatively affecting job opportunities and employment levels.
Excessive Automation Risks Favoring capital over labor in taxation may lead to excessive automation, resulting in suboptimal employment rates.

Behaviors

name description
Job Displacement by Automation The trend of robots and AI displacing workers in both routine and nonroutine tasks across various industries.
Creation of New Technology Jobs Emergence of new roles such as AI engineers and cloud engineers driven by technological advancements.
Economic Viability of Technology Adoption Adoption of automated technologies varies based on their economic feasibility and benefits, affecting job creation or loss.
Differential Impact on Worker Demographics Job impacts of automation and AI are not uniform, with certain demographics (e.g., gender, education level) being more affected.
Resilience of Manufacturing Employment In some regions, increased robot adoption correlates with rising manufacturing employment due to enhanced productivity.
Gig Economy Social Protection Needs Growing gig work leading to a demand for new social protection schemes beyond traditional insurance systems.
Interdependence of Technology Choices Technological impacts must be assessed considering their interdependence across different sectors of the economy.
Digital and Social Skills Development Emphasis on developing digital and emotional skills to ensure worker adaptability in an increasingly automated workforce.
Labor Market Inequities and Distortions Market failures and policy distortions impact labor mobility and the adoption of automation technologies.
Public-Private Partnerships for Worker Support Success in worker support initiatives via collaborative public-private approaches that enhance awareness of social benefits.

Technologies

name description
Robots Robots are increasingly used in manufacturing and routine tasks, impacting labor markets by displacing some workers while creating new roles.
Artificial Intelligence (AI) AI technologies are transforming workplaces by both displacing and augmenting tasks across various occupations, presenting significant implications for labor markets.
Digital Platforms The rise of digital platforms is creating new job opportunities and tasks, exemplified by emerging roles such as AI-prompt engineers.
Digital Skills Development Improving digital skills is essential for workers to thrive in the increasingly digitalized job market and utilize new technologies effectively.
Social and Emotional Skills Skills that enhance social interactions, vital in roles where machines cannot easily replace human interaction, are gaining importance.
Advanced Technical Skills Skills related to the creation and use of emerging technologies are crucial for adapting to changes in the labor market.

Issues

name description
Job Displacement by Automation The risk of routine manual and cognitive tasks being automated leading to job losses, especially affecting low-skilled workers.
Differential Impact of AI Unequal exposure of different demographic groups to AI technologies, affecting job security and opportunities.
Emergence of New Job Categories Creation of new tasks such as AI-prompt engineers due to technological advancements, altering job landscapes.
Social Protection for Gig Workers The increasing need for social insurance schemes to protect gig economy workers and their financial stability.
Digital Skills Gap The necessity for enhanced digital and social skills training for workers to thrive in an automated and digital labor market.
Labor Market Distortions Issues such as poor job information and rigid institutions that hinder labor mobility and optimal technology adoption.
Impact of Industrial Robot Adoption While robot adoption can create jobs, it also displaces low-skilled workers, raising concerns about employment balance.
Economy-wide Technology Impacts The interdependence of technology adoption across sectors and its varying effects on employment levels.