Which Types of Workers Are Adversely Affected by Digital Transformation? Insights from the Task-Based Approach

Abstract

How digital technologies will affect skills and training needs is one of the conundrums of the evolving Industry 4.0. Important answers have been provided over the past 20 years by a new perspective: the task-based approach within labour economics. This approach interprets a job as a set of tasks, and it exploits employee survey data to measure and compare jobs in terms of skill needs. This chapter presents insights gained from the extant literature within this approach, including our own research, and identifies groups of employees whose job prospects and training opportunities are especially vulnerable. In particular, the evidence suggests that digital technologies often replace human employees who perform routine tasks. The remaining jobs will tend to include more sophisticated tasks such as directing and planning. Employees in jobs involving more routine tasks will therefore most likely need considerable retraining and upskilling. For various reasons, employers are unlikely to support this group of employees in terms of training and retraining. At the same time, routine jobs are often highly specific—their sets of tasks differ from those of most available jobs. Therefore, employees with such skill profiles are less likely to easily find alternative jobs. In other words, we identify a triple risk of digitalisation for some workers, namely those who conduct routine tasks, have a very specific skill profile that limits their ability to move to other jobs, and receive little training and retraining. Our approach and findings have important managerial and policy implications. Based on the framework we suggest, employers could identify and support employees with considerable risk by tracking their skills in a competence management system, i.e., by examining the digital twins of employees in terms of skills. If employers are unlikely to offer enough further training and retraining, an appropriate public policy response would be to reorganise initial vocational training—more than in the existing system, young employees need to be equipped with an even more general set of tasks, which would allow them to switch jobs within (and perhaps across) occupations.