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Digitalisation is changing the architecture of work. Meanwhile, the Internet of Things or IoT is the internetworking of smart devices and the connectivity that enables them to collect and exchange data. In this first of two guest blogs, labour expert and activist, Auret van Heerden reflects on the potential advantages and disadvantages of both. Is “big data” leading to a brave new world or a dystopian future? You decide.
HR analytics already monitor issues such as discrimination, inequality, diversity and performance and will soon take over recruitment, hiring, deployment and termination.
Yet digitalisation is going further still. It will change the architecture of work and the employment contract that goes with it. The spatial and temporal dimensions of work will be completely redefined and many functions will be performed by contractors from remote locations.
The global supply chain will be replaced by a global network of contractors coordinated through platforms.
An on-demand workforce …
The on-demand or gig economy requires an on-demand workforce of contractors. This “Uberisation” of work will take the form of a global labour market of contractors or contingent workers competing for “gigs” – projects or tasks that they perform as independent contractors, rather than as employees, with all of the social and economic implications that go with that contract status.
It is popular to believe that only certain services fit the “on-demand” model. Transport, accommodation, IT. But if you take a step back and look at how digitalisation will impact manufacturing, you quickly realise that it also means automation, new technologies and new business models.
It is highly likely that the retail landscape will change dramatically under pressure from the likes of Amazon, Alibaba, Zalando and WeChat.
Consumers will make personalised and customised purchases via Apps and expect same-day delivery. Since no retailer or wholesaler can keep enough inventory, demand will be satisfied by an “always-on” supply chain that will assemble clothing and footwear from prepared components, many of them cut or printed by digital machinery.
Large clothing and footwear factories employing millions of semi-skilled workers will be replaced as the ILO warns in its report, ASEAN in transformation: the future of jobs at risks of automation. We’ll see automated cutting, pressing, printing, stitching and bonding facilities working on a pull model of order replenishment, rather than the inefficient push models that dominated in the past.
In other words, the digital supply chain will make, on-demand, what people order and pay for, instead of pumping out huge quantities of stuff that reach the market nine months later, only to find that fashion has moved on.
… will be located close to the final consumer …
The digital, always-on supply chain will be located close to the final consumer and be staffed by technicians and a new class of digitally literate workers supporting the machines. But the skill will be programmed into the machines by remote programmers, and the management will come from cognitive computers making superior decisions based on millions of data points a human brain could never compute.
Bottom line, both highly skilled and semi-skilled work will be digital and contingent, and the bulk of it will be performed by cognitive computers directing “smart” machines emitting terabytes of data from all their sensors.
All personal and professional data will be available to those cognitive computers in the “big data” streams they mine to decide what on-demand work needs to be performed to satisfy the on-demand consumer.
This digital transparency may well bring precision to the measurement of work time and pay, and allow for fascinating statistical analysis, but the nature of the employment relationship (and contract) will have been fundamentally altered.
… and a precariat will replace the old proletariat with few protections
Some commentators are calling the new on-demand workforce a precariat, replacing the old proletariat, and they will certainly not enjoy the same job security previous generations may have had. Neither will workers have the social safety nets and labour law protections their parents relied on.
Social security systems, labour and tax laws will need to be adapted to accommodate global contingent workers, and the transition will not be smooth.
- How will regulators define minimum wage rates or professional tariffs for work performed remotely via virtual platforms? Or will market, supply and demand, determine the rates?
- How will the working day be defined when workers log on from remote locations and “gig”?
- How will governments define employment and unemployment when most workers are independent contractors hired on a task or project basis?
Ultimately, it is not only the nature of work but also the regulation of work that will be transformed by digitalisation. Workers will find themselves in a virtual world with a virtual employment relationship and virtual protections. Just how real will those protections be? And what will happen to the workers whose jobs will no longer exist?
Read Auret's second blog on the Internet of Things and what "smart" may mean for workers.