The World Economic Forum has recently put out a document called the Future of Jobs. It’s the fourth since 2016. This year the report focuses on a variety of issues related to work, jobs and unemployment. To quote: “The… survey brings together the perspective of 803 companies — collectively employing more than 11.3 million workers — across 27 industry clusters and 45 economies from all world regions.” It thus tries to be global in scope but is mainly about the western hemisphere. Quite peripherally, these apply to the rest of the world which has different kinds of employment issues.

However, even if the data, analysis and prescriptions are West-centric, the problem is a global one. There is simply no way the world is going to be able to find jobs for the global workforce of even a quarter of the world’s population of 8-odd billion. The report ignores this demographic mountain. Instead, it emphasises the role of artificial intelligence and skilling. Those companies that participated in the survey which underlies this report seemed very clear (without saying so explicitly) that AI would be used to replace high cost labour — in Europe, presumably — and the rewards to those with the necessary skills would be high. The report says “Of the 673 million jobs reflected in the dataset in this report, respondents expect structural job growth of 69 million jobs and a decline of 83 million jobs. This corresponds to a net decrease of 14 million jobs, or 2% of current employment”.

Indian companies, private and government owned, are not going to be an exception to this trend. Even if it isn’t profit, costs will be the key determinant of company policy. In a highly competitive environment, that’s what will earn returns for shareholders. AI plus higher skill levels for those with natural intelligence means fewer, not more, jobs, or perhaps even work. The distinction is important because jobs are for income smoothening while work is about irregular income. And, as all the latest evidence shows, even this will be at hugely reduced payments. Globally, therefore, the future of labour looks bleak. It’s only the highly skilled who will earn a lot. The rest will have to make do as best as they can. It will be the old Ricardian theories applied to labour this time instead of land. Ricardo had said that the more fertile land is, the more it will earn, usually some large multiple of less fertile lands.

The findings must be taken very seriously by governments the world over. They are going to be faced with constantly diminishing income-earning opportunities for the majority of their populations while a small minority earns a lot. This will have cumulatively gigantic consequences for the management of government finances that, as we have seen since 2009, will have to provide income support, not to speak of societal tensions springing from rising unemployment. That said, the real problem isn’t AI alone. It’s 8+ billion people on a planet designed for half that number.

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