‘The Future of Work after COVID-19’ report from the McKinsey Global Institute (MGI), reveals that several companies adopted artificial intelligence (AI) in grocery outlets, warehouses, manufacturing plants and call centres to bring down the density of employees in the workplace, even while trying to fulfil the spurt in demand. This trend was most noticeable in sectors and organisations that require more physical proximity. The report by MGI forecasts that in India, the total work hours spent on utilising manual and physical skills will drop by 2.2 percentage points, whereas time spent on technological skills will go up by 3.3 percentage points.
The study reveals that businesses have always tried to control costs and tackle recession-induced uncertainty by adopting automation and redesigning work processes. This results in a drop in the number of jobs that primarily involve routine tasks. About two-thirds of those surveyed across eight countries admitted to increasing their spend on automation and AI. The fact that China’s production of robotics had gone beyond the pre-pandemic levels by June 2020 itself speaks volumes!
In jobs paying low wages, workers use basic cognitive skills and physical and manual skills 68 per cent of the time. However, in occupations that belong to the middle wage bracket, only 48 per cent of the work hours are spent using these skills. In the higher wage brackets, 20 per cent of the working hours are spent on those skills.
Before the pandemic, net job losses were limited to middle-wage occupations in manufacturing and some office work. In future, more than 50 per cent of the low-wage workers who lost their jobs may have to look for alternative jobs that pay higher wages, and require different skills to remain employed.
Considering the concentration of job growth in high-wage jobs and dip in low-wage jobs, it will be quite a challenge to handle the scale and nature of workforce transitions needed in the years ahead. At least a 100 million workers across the eight countries studied, that is, one in 16 workers, will have to find a different job in the next one decade, in the post-COVID-19 world. This is 12 per cent more than was estimated before the pandemic, and up to 25 per cent more in the developed countries.