TECHNOLOGY AT WORK

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62 Citi GPS: Global Perspectives & Solutions February 2015 Figure 49. Employment share at risk by country Country Frey & Osborne (2013) 702 occupations Bruegel (2014) Study (Level of detail) ETLA (2014) Frey & Osborne; Deloitte (2014) SSF (2014) Unionen (2014) 22 occupations 410 occupations 369 occupations 109 occupations Austria 54% Belgium 50% Bulgaria 57% Croatia 58% Czech Republic 54% Denmark 50% Estonia 54% Finland 51% 36% France 50% Germany 51% Greece 56% Hungary 55% Ireland 49% Italy 56% Latvia 51% Lithuania 52% Luxembourg 50% Malta 51% Netherlands 49% Poland 56% Portugal 59% Romania 62% Slovenia 53% Slovakia 55% Spain 55% Sweden 47% 53% 37% United Kingdom 47% 35% United States 47% Source: The Oxford Martin School 353 occupations While there are a number of measurement problems associated with comparing countries according to their susceptibility to automation, it is clear that differences across countries and regions exist. The Bruegel study, for example, finds a strong negative relationship between a country’s GDP per capita and the share of their workforce at risk of automation, suggesting that countries transition into jobs that are less susceptible to automation along the development path. In particular, developing countries are likely to find a larger share of their jobs at risk, as lower wages keep many jobs that are possible to automate from being displaced. However, as incomes rise and technological progress makes labour substitution cheaper, even these countries will eventually have to adapt. The challenge ahead for any country is managing this transition at a sufficient pace for workers to find new employment opportunities as existing jobs are being automated. © 2015 Citigroup
February 2015 Citi GPS: Global Perspectives & Solutions 63 Entirely new occupations and industries are being created as a result of digital technology Technology and New Work Digital technologies do not only destroy jobs, but also create jobs in entirely new occupations and industries. For example, computer technology has recently given rise to many new occupations, such as database administrators and web designers. Beyond computer-related jobs, occupations such as that of the radiation therapist similarly underwent significant changes, following the arrival of new technologies. After the first magnetic resonance imaging (MRI) machine was patented in 1974, leading the way for the proliferation of MRI scanning techniques, a new occupational title emerged: MRI special procedures technologist, operating and monitoring diagnostic imaging equipment. Indeed, the more than 1,500 new job titles that appeared in the occupational classifications following the invention of the PC reflect a pervasive transformation of the world of work. 84 New technologies have also created entirely new industries. Consider the Video and Audio Streaming industry, which appeared as a new title in 2010, following a series of recent innovations — in 1999, Apple developed QuickTime, a programme capable of handling various video formats, and in 2002, Adobe introduced Flash, a streaming format that is used by YouTube. The Video and Audio Streaming industry is not an isolated example: Internet news publishers, Social Networking Services and Internet video broadcast sites are all new industry titles that are associated with the advent of the World Wide Web. 85 Figure 50. New industries emerging from digitisation Detailed Industry % of New Industry Titles % of U.S. Employment % with College degree Avg. Wage ($) Internet publishing and broadcasting and web search portals 85.7% 0.06% 69.6% $ 81,138 Electronic shopping 42.8% 0.08% 49.7% $ 45,372 Data processing, hosting, and related services 32.0% 0.08% 48.0% $ 64,729 Electronic auctions 66.6% 0.01% 52.2% $ 47,257 Source: Berger and Frey (2014b) However, studies have found that the number of new jobs created from the arrival of new technologies throughout the 2000s has been strikingly small Although there are a number of measurement problems associated with examining the share of jobs that stems directly from new technologies, new industry titles that emerge in official classifications as a result of new technologies becoming available, at least provide an indication. Thus, a recent study by Thor Berger and Carl Benedikt Frey used such data to systematically capture employment opportunities created by new industries of the 2000s in the United States. Their findings are quite revealing. First, the magnitude of new jobs created from the arrival of new technologies throughout the 2000s has been strikingly small: in 2010 only about 0.5% of the US workforce was employed in new industries that did not exist a decade earlier. 86 Second, workers in these industries are substantially better educated than the average population and earned much higher wages: the average wage for workers in new industries is more than twice the US median wage. For any given level of education, workers with a STEM degree are also more likely to work in new industries. Jobs created through technological progress have been largely confined to skilled workers Hence, in short, although technological progress continues to create new jobs, these have largely been confined to skilled workers. Cities and nations with a large pool of skilled workers have thus benefited disproportionally from recent technological change. 84 Berger and Frey (2014a). 85 Berger and Frey (2014b). 86 ibid © 2015 Citigroup
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