A dystopia of job loss and surveillance or a utopia of transformation and progress.
This puzzle sums up the heated debate about automation and its impact on the future of work.
Optimistic narratives about the progress of the Fourth Industrial Revolution or the Second Machine Age are coupled with predictions of a bleak future, in which robots and automated processes lead to large-scale casualization, surveillance and control.
The truth is not that simple.
Automation involves a new relationship between workers and technology, new “spatial fixes,” whether in global production networks or telecommuting, as well as enabling new types of employment relationships.
It is important to develop global narratives about the future of work in labour-abundant economies like India, where the effects of automation can pose a challenge to development.
India has long suffered from structural inequality, poverty, the dominance of informal work and self-employment, and high rates of unemployment. It also has specialized experience in the field of information technology.
Young graduates and mid-level professionals seem likely to benefit from the AI revolution. Tensions over inequality – exacerbated by fears that technological innovations will undermine jobs and security – are increasingly prevalent.
An assessment of how automation will impact work in India does not support a radical shift from current employment practices or major changes.
Instead, the adoption of emerging technologies is uneven and irregular. This may improve working conditions for some workers, but is unlikely to benefit the majority without redistribution of income and wealth.
Manufacturing: Automation with “contracting” and self-employment
Manufacturing can be severely affected by automation, but its adoption needs to be balanced with development costs and labor costs where labor is abundant.
High-tech export-oriented automotive and telecommunications production is more likely to adopt advanced automation, partly due to the large number of routine tasks.
Labour-intensive industries, such as textiles, clothing, leather and footwear, are unlikely to adopt high technologies because of the need for large capital investments in what are mostly small-scale enterprises in the informal sector, with low-cost labor readily available.
Automation in the manufacturing sector is driven by “contracting”—hiring contract workers rather than directly hired employees to weaken the bargaining power of regular (full-time) and unionized workers and keep wage demands in check—and labor substitution by firms. The share of contract workers in total employment increased, while the share of directly employed workers decreased.
It is also common for apprentices and contract workers to work alongside full-time workers to do the same job in the same store, and for supply chains to rely extensively on the informal economy.
While it is possible to create new jobs, increased “contracting” leads to deteriorating working conditions. Contract workers can be easily fired, receive much lower wages than permanent workers, and do not have access to social protection mechanisms.
The other trend that is likely to intensify in the field of employment is the shift from paid work to self-employment. While it is possible to create new entrepreneurial opportunities, evidence suggests that for most people self-employment is not an option but a necessity.
More than 80% of the informal sector workforce is classified as self-employed, but they work at the subsistence level with little access to capital or social security. In the face of the myth that this shift to self-employment represents “entrepreneurship,” the reality is the “hidden dependency” of self-employment, and its gender, sectarian, and societal basis.
Dependence of workers on large companies or merchants, which leads to intensification of work and dependence on unpaid family labor. These self-employed workers are highly precarious, informal workers vulnerable to exploitation.
The shift to “contracting” and self-employment with increasing automation may mean increased informality, instability, and worse working conditions for many.
Services: Automation with freelance work
The impact of emerging technologies is most evident in the business process outsourcing (BPO) and IT industries, the financial sector, and in customer services.
Back-end tasks are becoming increasingly automated. However, this shift is unlikely to create widespread employment, as indicated by the significant slowdown in hiring and increased layoffs in the IT sector since 2016-17.
One report indicates that 640,000 low-skilled service jobs in the IT sector are at risk of automation, while only 160,000 medium- to high-skilled jobs will be created in the IT services and business process outsourcing sectors.
IT workers will need to improve their skills quickly, but fewer jobs will be created in the medium term. Informalization and “contracting” through outsourcing and subcontracting are increasing, at the expense of formal working relationships in the IT sector.
The platform economy promises new economic opportunities for service workers, especially women and migrant workers, by enabling new forms of micro-entrepreneurship and independent work.
It can improve working conditions in terms of higher income, better working conditions, flexible working hours or access to banking services. Platforms also promise a sense of community that can be mobilized for collective bargaining.
However, taking advantage of these opportunities requires workers to have technical skills, while the majority have limited opportunity to improve skills. This also highlights the disconnect between current education programs and the skills employers need.
Too often, surveillance and control belie the rhetoric of freedom, flexibility, and autonomy. Labor sharing platforms are unregulated, profit-seeking, data-generating infrastructures that rely on opaque labor supply chains and use artificial intelligence to control workers by directing, recommending, evaluating, recording, evaluating, and disciplining them through reward and replacement.
As in manufacturing, participation in self-employment is driven by the lack of secure alternative employment opportunities. Most people work multiple jobs for several employers on a piece-rate basis and lack access to formal social protection.
Automation appears to be creating a flexible and controlled “digital labor” base, reproducing informal labor and precarious working conditions rather than positively transforming work.
Agriculture: limited automation and persistent poverty
Agriculture remains India's largest employer with high potential for automation.
Most agricultural tasks can be classified as manual, such as planting crops, applying pesticides and fertilizers, and harvesting. AI and data analytics technology has the potential to improve farm productivity, which has been highlighted by several agritech startups in India.
However, the underlying dynamics of agriculture and its pervasive and persistent role in perpetuating informal employment pose a challenge.
Agriculture experiences structural inequalities, widespread poverty, subsistence farming, low skill levels, and low productivity.
Land ownership is concentrated among a small number of people, with limited capital investment, while 75% of rural workers work in the informal sector, 85% do not have an employment contract or health or social security, and some are subject to “new slavery.”
This extreme inequality, combined with low land holdings, low growth, and low capital investment, means that any widespread adoption of advanced farm automation and digital technologies seems unrealistic. More likely is the adoption of precise techniques and additional mechanization.
The growing labor surplus in agriculture continues to fuel the informal economy, as workers are unable to break the vicious cycle of low wages and low skills. The lack of job creation and the increasing informality of formal manufacturing and service sector jobs (in the platform and gig economy) are likely to exacerbate these challenges.
Automation and inequality
Automation is likely to bypass those sectors that employ the most low-skilled workers. The social implications of this are far-reaching.
The lower cost of labor in the informal economy reduces the likelihood of technology adoption. High levels of poverty, coupled with low levels of education among men and women in semi-urban and rural areas and marginalized social groups, will limit their access to any gains from technological development. This will limit economic opportunities.
Women and marginalized groups are less likely to have digital skills and are more likely to hold jobs most vulnerable to the effects of automation. Self-employment is likely to increase, but not necessarily accompanied by an improvement in working conditions. New technologies can enhance the widening gap between urban and rural areas.
Automation can reproduce informal and precarious work rather than transform existing trends.
A future of fair and equal work is made possible by the adoption of new technologies – from the growth of the platform economy to distance learning opportunities.
Its effectiveness will depend on how well it is integrated with broader policy interventions that address deep-rooted inequalities and enduring employment and skills challenges in India's world of work.
For example, skills have been identified as a key element of the National Automation Strategy. However, India does not have a history of success in upskilling with low investment in training structures, reluctance of companies to invest in training and reliance on informal skills. There is a significant digital gender gap that negatively impacts skills initiatives.
Policies that facilitate the ability of women and other socially disadvantaged groups to benefit from new technologies will help achieve a fair future of work.
Dr. Anita Hammer Know in King's College London and conducts research on work and employment in the Global South, with a particular focus on India and the Middle East. Anita's research draws on history, political economy, and sociology to examine informal and precarious work, the impact of technology and climate change on work and employment, and political debates around “decent work” and “just transition.”
Originally published under Creative Commons by 360info™.
