Professor of Practice Mark Skilton writes that the oncoming digital connection of homes, workplaces, factories, cars and transports does not necessarily mean the wiping out of millions of white-collar jobs but the prospect of new services and career opportunities. 

If Google chairman Eric Schmidt is to be believed, the automation of jobs will be the “defining” problem of the next two to three decades. At a debate at Davos 2014, he warned that the constant development of new technology will put more and more middle class people out of work.

This is a challenging assertion that will hit home to any parent or educator seeking to support the next generation of workers.

Schmidt sees the rise of automation as nothing short of a second Industrial Revolution. He believes the way work is conducted will be radically different in the future as many human tasks are automated by algorithms and computer services.

I initially agree with this assessment. Over the past 30 years, we’ve seen a dramatic shift in workplace IT. Once, islands of computing systems ran basic operations and finance administration from dedicated server rooms. Then the evolution of the PC and the internet put a computer on everyone’s desk. Now mobile devices and tablets, fuelled by massive social networks and multi-media digital services, have exploded the volume of information about people, products, places and workspaces on a planetary scale.

Superfast computing

Technology has not just brought us masses of connections and exabytes of information. When we passed a certain threshold in the level of computing power for devices that could sit in the palm of your hand, many tasks that previously required a high level of education and skill became infinitely simpler to carry out.

Tasks that are still difficult in 2014 may not be such an obstacle in 30 years. Jobs that currently require the human touch could well be done by machines in the future, particularly as natural language processing advances. The automated question and answer services that many websites offer as a customer care service may seem clunky now, but that won’t always be the case.

Blinded by the novelty

In order to work out whether technology will lead to the demise of the white-collar worker, we have to think about how connected and pervasive these systems will become in our everyday lives.

At the moment, it’s not easy to tell because we are currently somewhat blinded by the novelty of today’s IT functionality. We are still getting to grips with the ability to carry out complex tasks on our phones and the power of the search function on a webpage. This is just the initial face of some of the services that have made ordering products and services or delivering on-demand multi-media entertainment, books and digital content easier. It’s only the customer side of the IT revolution and it is only the start.

Banking services are now much more commonly automated than in the past, removing the need for service desk and customer liaison staff. Over in retail, self-service and computerised stock tracking, both online and in real life, are gradually replacing workers.

Now we are seeing shift in economies of scale of knowledge in areas such as searching, tracking, buying and selling that are shifting from traditional physical jobs to online virtual work automated by machine algorithm and responses.

This hasn’t had a significant impact on large numbers of jobs yet, but the main point raised by Schmidt at Davos is that things start to get more serious when IT services are connected to everyday objects like cars, homes and everyday products.

We can expect, for example, to see rooms and buildings functioning without the need for human intervention and traffic systems becoming fully automated.

If home appliances such as fridges or entertainment systems can plan ahead and restock themselves automatically based on their owner’s preferences, then whole links in the current supply chain become redundant. And if a home can automatically arrange repair services for itself, fewer human jobs are needed. If an office can do it, even fewer people are needed on the ground and since we’ll all be working from home anyway, we may not even have to wait until full automation before we start seeing humans being replaced.

And as transport moves towards increased automation, the role of humans is again uncertain. If emergency responses can be sent out when an alert is received from a patient’s monitoring device, fewer people are needed to man the phones. Go a step further and virtual reality and location-aware services could provide advice for travellers in villages, towns and cities.

Connecting these together in a nested ecosystem of automation has the potential to change the way whole job markets, countries and industries buy, sell and trade business. Wealth creation will shift away from being the responsibility of the human to the job of the machine.

Life in the old dogs yet

Before we give up all hope though, it’s worth remembering that human workers survived the earlier industrial eras of steam, electricity, telegraph and globalised media. We continued to work because with every new level of automation, new jobs are created that replace those that are lost.

Schmidt’s call for a debate is a timely reminder that all these things also have the potential to create new levels of human value and better lifestyles for people. Technology replaces humans in many ways but new opportunities are created to exploit these technologies too. A new era of work is upon us and new types of work will emerge to exploit the new technologies that we will use.

See this article featured at The Conversation and Pandodaily. 

Professor of Practice Mark Skilton teaches Strategic Global Outsourcing and Offshoring on the Warwick Executive MBA.