Where will our jobs come from in the future?

First, the good news.  According to the report ‘Working Futures’[1] published by the UK Government-funded Commission for Employment and Skills (UKCES), there will be 140,000 more jobs in Scotland in 2022 than in 2012 – a 5% increase.  The four sectors estimated to see the largest increases are health and social work, professional services, construction and information technology. Those sectors seeing the largest reductions by 2022 include manufacturing, public administration and defence, education and agriculture (UK Government 2015) (Figure 6).

With its forecasted reduction in skilled trades, manufacturing and civil service posts, Working Futures data supports the theory that a continued ‘hollowing-out’ of the mid-skilled labour market is likely over the next decade (Bank of England 2015). If realised, increases in professional and managerial jobs in the higher wage brackets, alongside substantial growth in low-paying personal care employment, could justify concerns about further labour market polarisation.

Changes in employment 2012-2022 by industrial sector (,000s)

Sector

Source: SPICe, data from UKCES 2015

Working Futures also provides projections of changes to the occupational composition of the labour market (Figure 7). The increase in the number of ‘professional’ and ‘associated professional’ jobs by 2022 is striking. Most of these will be in health, education and computer programming. Large reductions could be seen in ‘machine and plant operative’ positions, ‘skilled trades’ and ‘administrative and secretarial’ occupations.

These structural changes, and the possible growth in income inequality that might result, could provide some difficulties for a Scottish public sector now signed-up to principles of ‘inclusive growth’, ‘solidarity’ and ‘cohesion’. How our enterprise agencies, education providers and employers respond to these challenges may well become a defining theme of the next parliamentary session.

Changes in employment 2012-2022 by occupational group (,000s)

Occupation

Source: SPICe, data from UKCES 2015 

Changes over the longer term

Over the past century, science fiction and philosophy have explored the implications of computers carrying out cognitive tasks previously done by humans. However, recent developments in the areas of artificial intelligence, ‘big data’ analysis and machine learning, mean that computerisation can now “readily substitute for labour in a wide range of non-routine cognitive tasks” (Frey and Osborne 2013). With this in mind, Oxford academics, Frey and Osborne, created a ranking of jobs most at threat from computerisation over the next few decades in the USA. As well as information processors and administrative occupations (such as insurance underwriters and data entry staff), the authors suggest that accountants, tax examiners, paralegals and credit analysts (ibid) may well be heading towards “vocational extinction” (Bank of England 2015).

Of course, new technologies should also lead to increased productivity and a possible boost to ‘real’ incomes over the longer term. From this, demand for entirely new goods and services may well grow. We have seen where forecasters say jobs are likely to be lost, but what about the new industries and new occupations in which our children and grandchildren will spend their working lives? In January this year, the World Economic Forum quoted “a popular estimate” that 65% of children entering primary school today will “ultimately end up working in completely new job types that don’t yet exist” (World Economic Forum 2016). In other words, we don’t know what the labour market will look like in twenty or thirty years. Perhaps we should ask a computer…

[1] This report is “a quantitative assessment of the employment prospects in the labour market over a ten year horizon”.

Greig Liddell

Sources:

Bank of England (2015) Labour’s Share – speech by Andy Haldane. Available at – http://www.bankofengland.co.uk/publications/Pages/speeches/2015/864.aspx  [Accessed 27 April 2016]

Frey, C. and Osborne, A. (2013) The Future of Employment: How Susceptible Are Jobs to Computerisation?*.  Available at – http://www.oxfordmartin.ox.ac.uk/downloads/academic/The_Future_of_Employment.pdf [Accessed 27 April 2016]

UK Government (2015) Working Futures, UK Commission for Employment and Skills. Available at – https://data.gov.uk/dataset/working-futures [Accessed 27 April 2016]

World Economic Forum (2016) Global Challenge Insight Report: The Future of Jobs Employment, Skills and Workforce Strategy for the Fourth Industrial Revolution. Available at – http://www3.weforum.org/docs/WEF_Future_of_Jobs.pdf [Accessed 27 April 2016]