Technology and the Future of Australian Jobs: Oxford Economics Report
Technology Transforming Australian Jobs – the Human Era
- Research commissioned by Cisco and Oxford Economics uncovers the impact of Artificial Intelligence (AI) on workers in every sector
- Predictions across a range of sectors includes Transport, Retail, Healthcare and Agriculture, with analysis into the changes in the labour market by occupational types, and identifies where the skills shortfall will hit the hardest
- Technology will push Australia towards a new Human Era, with cognitive and social skills increasingly demanded across the board creating a significant need for new skills and upskilling of the workforce
- 630,000 Australian jobs could be displaced by new technologies over the next decade, with the research forecasting the impact of the income, displacement and net effect for each sector.
Sydney, Australia – 3 December 2019 – A new report commissioned by Cisco and conducted by Oxford Economics, the leader in global forecasting and quantitative analysis, reveals the impact of technology on Australian jobs and sheds light on how technology is propelling Australia into the Human Era.
Technology and the Future of Australian Jobs shares forecasts for the next decade and the impact that advancing technology will have on Australian workers and their future skill sets across the entire labour market. Deeper insights are provided for eight key sectors: Education, Wholesale & Retail, Mining, Transport, Healthcare, Finance, Agriculture and Utilities.
Using the Oxford Economics Skills Matching Model, the report delves into the changing skills needs in the workforce as technology causes a ‘displacement effect’ on some occupations, but also creates opportunities in others, via the ‘income effect.’ The ‘displacement effect’ is the reduction in demand for workers to perform certain tasks, implied by the productivity gains technology will bring. The ‘income effect’ is the increase in demand for workers to produce new and different goods and services, as technology boosts productivity growth and real incomes in the economy. The ‘net effect’ on jobs is the balance between the displacement and income effects, indicating which parts of the economy will see a rise in demand for workers, and which will see a decrease.
A total of 630,000 Australian jobs could be displaced by new technologies over the next decade, which equates to more than 7 per cent of Australia’s current workforce. The net effect of these likely job disruptions and increased requirements illustrates a shift in the Australian workforce over a 10-year period, and a number of challenges in meeting the required skills to successfully navigate the transition.
Key insights from the report includes:
- Transport and retail are amongst the sectors most ripe for disruption as technology presents new and evolved opportunities for upskilling workers. Transport will see a need for more roles in technical design, programming and customer service. For retail, e-commerce will boom with increasing needs for programming and technical skills. The role of sales assistant, which will evolve in nature, will also flourish as the need for human connection and personalisation grows.
- The growth in demand for workers in healthcare will outpace all other sectors of the Australian economy over the next 10 years, with close to 80,000 new jobs created.
- Across the entire labour market, 350,000 workers will find themselves in jobs that require an upgrade of their active listening, speaking and critical thinking skills.
- More than one third of workers transitioning into new positions will need to upgrade their softer human skills, including coordination, negotiation and persuasion, to meet the demands of their new role.
- Overall, the need for workers to sharply improve their proficiency in programming is apparent as each industry is currently up to 60 per cent short of the required skill-level. In addition, cognitive and social skills will be highly sought after across the board.
Commenting on the findings, Cisco Australia and New Zealand‘s Managing Director of Enterprise and the Digital Transformation Office, Sam Gerner, says: “Over the next 10 years the pace of technological change will be highly disruptive to the world of work, yet has the potential to deliver great rewards to those who anticipate the shifts in the labour market and the relevant skills that will be required. The productivity gains for all industries, defined in the findings as the ‘income effect,’ illustrate a huge opportunity for Australia. This prompts the need for Australian industry and technology leaders, policy makers and educational institutions to join forces and develop frameworks and programs that will address that critical need for developing new skills in the current workforce and training younger generations.”
Mr Gerner added, “A key insight from the report is the need for many roles that demand more developed soft skills, such as listening, speaking, critical thinking, negotiation and persuasion skills. These are the skills that are going to be more valued as technology increasingly takes care of the automated tasks. We are entering a period in time that really can be described as ‘the human era.”
Technology enabling the ‘human era’
This era has the potential to deliver great rewards to the Australian economy through productivity growth. But as increasingly powerful AI-led technologies are applied across industries, there are also understandable fears about the impact this will have on jobs. Significant parts of the workforce are at risk of being left behind if they are not prepared with the guidance and skills demanded by an evolving economy.
While technology is becoming increasingly prevalent across industries, we are now approaching what we believe to be the ‘human era’ – in which technology is enabling humans to focus on those tasks that require soft skills. The ‘human skills’ in most demand include listening, speaking, critical thinking, negotiation and persuasion skills, and will become increasingly more valuable as these soft skills cannot be recreated by technology.
Oxford Economics Director of Economic Consulting, Asia, James Lambert shares his view on the impact technology has on the workforce; “From the industrial revolution through to the modern digital era, workers have commonly defined their value by their ability to use technology. Now, as technological capabilities expand deeper into the workplace, it is ‘human skills’ that increasingly define an employee’s value.”
You can find more details on how technology will impact Australia’s labour market and the future of Australian jobs, how Australia compares to other countries, as well as insights into the jobs displacement effect, the income effect and the re-skilling challenge in the Technology and Future of Australian Jobs report, available here.
An interactive infographic detailing out each sector is also available here.
You can watch a video featuring kids on what they think of the future of work here.