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Coronavirus, automation and the future of work

According to Cedefop’s skills forecast, in the sectors with a medium-high and high impact of coronavirus on economic activity, around one-fifth to one-quarter of the new jobs expected to be created up to 2030 are at risk of automation. This amounts to around 1.4 million jobs at stake in the EU-27.

As societies are struggling to cope with the new reality following the coronavirus pandemic in terms of socialising, shopping or working, the question arises as to whether this new way of living is here to stay and whether technology will from now on be the preferred way of doing things.

The ILO has used real-time economic and financial data to investigate the impact of the crisis on output by sectors of economic activity. Given that output is the major determinant of employment trends, it is possible to make a first assessment of how the pandemic may affect future skill needs and what the implications for occupations are. The dominant occupations in the sectors affected the most can be examined to gauge the impact of coronavirus on employment and the impact of automation and technology. Data from the 2020 Cedefop skills forecast, which is due to be published soon, along with the estimated risk of automation have been used for that purpose (see Table).

For some medium to low-skilled occupations the impact may be detrimental. For instance, within manufacturing, a traditional core sector in the European Union, the biggest share in employment belongs to metal machinery and related trades workers, an occupation typically employing workers with medium level of education. For that particular occupation, future job openings are estimated to be relatively low, its overall importance is diminishing and the risk of automation is very high.

Metal machinery and related trades workers is also one of the dominant occupations in another sector, that of wholesale and retail trade, repair of motor vehicles and motorcycles. Given that both sectors are severely affected by coronavirus and, in turn, future job openings may be lower than originally estimated by the skills forecast (estimations made pre-Covid-19), it is a logical assumption that such workers may be hit harder than others and automation may accelerate job replacement by robots more easily. However, firms intimidated by the pandemic may not invest in new technologies until the crisis is over and its impact is visible. Similar is the case for stationary plant and machine operators, the second biggest occupational group within manufacturing.

In accommodation and food service activities, another hardly hit sector, food preparation assistants seem to be the most vulnerable group of workers. They may be replaced by automation more easily also to protect public health by reducing the number of people present in a small place such a kitchen.

In contrast, occupations in the highly skilled groups, which are easier to adjust to new working conditions such as telework, seem to be safer in the battle against automation. For instance, in real estate, professional, scientific and technical activities the largest share in employment is that of business and administration professionals. Even though this sector is also experiencing the negative impacts of coronavirus, which may slow down its foreseen growth, it is gaining importance while its risk of automation is relatively low.

Cedefop expert Ilias Livanos, who leads the skills forecast, notes that ‘the ongoing coronavirus crisis may further accelerate job polarisation by hollowing out jobs in the middle who seem to be most vulnerable to the uses of technology.’