Digitalization, automation and the future of work. Evidence and policy responses
(S. Sacchi, D. Guarascio)
The world of work is facing radical changes due to the technological transformations affecting all economic and societal domains. Digital technologies are spreading across countries, industries and firms making geographical and temporal distances increasingly irrelevant. Automation is becoming widely deployed and Artificial Intelligence is emerging as a new technological paradigm. The collapse of time and space boundaries entailed by the diffusion of Big Data in all relevant economic domains – production, consumption, transports and communication – is deemed to reshape the way production factors are used and remunerated with potentially radical effects on employment (both on quantity and quality) and incomes (both on average and in distributive terms). The challenges entailed by this technological revolution interact with issues as market globalization, demographic trends and massive migration flows. In such a context, economic and social policies play a key role to help the world of work to seize the opportunities while minimizing the risks implied by the ongoing process of change.
This paper aims to achieve a threefold goal. First, to provide an analytical account of the impact of the process of digitalization and automation by identifying the relevant issues concerning the socio-economic impact of such process – that is, effects on employment quantity and quality; on tasks, skills and work attitudes; on income distribution; on markets and institutions, with a specific focus on employment and income distribution. Second, to review the available empirical evidence such effects on jobs and income distribution. The paper complements a review of the existing evidence with new data based on the only available O*NET survey in Europe, the one realized by INAPP for the Italian labour market, reporting information on tasks, skills, work attitudes and conditions regarding all Italian occupations. Finally, to identify and discuss the policy responses that can be adopted to ease the transition, that is minimizing the risk of technological unemployment, favouring reskilling and upskilling of workers. In this regard, the paper reviews two policy tools that were originally introduced for the purpose of cushioning the impact of global trade on jobs through compensating measures and training in the US and the EU – the European Globalization Adjustment Fund (EGAF) in the EU, established in 2006 and the Trade Adjustment Assistance (TAA) programme in the US, established in 1962 – and discusses how such policy tools could be adapted so as to help address the impact of technological change on employment.