AI is coming – UK Unions call for mid-career training and lower pension age

SUMMARY:

The Trades Union Congress has laid out its priorities for how it thinks government and business should deal with a new wave of AI and robotics innovation.

robots-typing-machinesAccording to a new report released by the Trades Union Congress (TUC), there is no need to panic about the impact of AI and robotics on the workforce, but there is a need for government and business to plan effectively.

The TUC wants to ensure that the benefits of digitalisation are shared fairly across the workforce and society – avoiding the mistakes made in the recent past, where rapid technological change has led to rising inequality.

It states that the share of national income going to labour has fallen over the last thirty years, with the automation of some jobs reducing workers’ bargaining power.

The report proposes that with the onset of increased automation, as a result of AI and robotics, the government should consider lowering the pension age, that businesses should aggressively introduce mid-career training, and give workers more collective bargaining power to share the economic benefits new technologies will bring.

TUC General Secretary Frances O’Grady said:

With the UK failing to make productivity gains in the last decade, we need to make the most of the economic opportunities that new technologies are offering. Robots and AI could let us produce more for less, boosting national prosperity. But we need a debate about who benefits from this wealth, and how workers get a fair share.

We should look on the changes ahead as an opportunity to improve the lives of working people and their families. The government could use the revenue generated to reverse policies to raise the state pension age. And businesses could use productivity gains to improve the pay and conditions of workers.

Robots are not just terminators. Some of today’s jobs will not survive, but new jobs will be created. We must make sure that tomorrow’s jobs are no worse than today’s. They must provide fulfilling work, with good pay and conditions. And there must be funding to train people for new work if their job is made obsolete.

A mission

A study by Frey and Osborne predicts that 47 percent of US jobs are at high risk of automation over the next couple of decades. A Bank of England analysis of this research suggests that, for the UK, this could equate to as many as 15 million jobs. Projections also suggest that it’s the lowest skilled that will lose out and that income disparities could widen further.

Given what’s at stake, the TUC is proposing that the UK needs to effectively plan how to use these new technologies to enhance productivity, jobs, and wages – and as part of this, the government’s recently released Industrial Strategy should include a ‘mission’ to make the UK a top five digital economy. The report states:

Britain’s current low levels of government and business investment, alongside cuts to higher and further education funding mean that at present we are at risk of falling behind.

The TUC wants this mission to be developed in consultation with the workforce, in a similar fashion to the way Germany has approached the challenge. The German government has involved companies, unions, churches and other stakeholders in planning and developing a response. It believes that if workers’ have a say in the use of new production techniques, jobs can be protected – but adds that the UK has an “exceptionally weak” level of workforce participation, coming sixth from bottom in a European league.

The priorities

As mentioned above, the TUC is focusing its advice for managing this change on three core areas – skills, pension age and collective bargaining/workforce engagement.

It firstly argues, unsurprisingly, that technological change has caused widespread disruption to workers’ jobs and livelihoods. As a result, it believes a key aim should be to protect workforces and communities who are at greatest risk of seeing their jobs change – and dealing with this disruption requires significant investment in the skills of the existing workforce. The report states:

Two thirds of those who will be in work in 2030 are already in the workforce –so investing in mid-career workers will be key to making sure that the next wave of technological change is one which benefits everybody.

At present, the UK invests half the EU average in workforce training – turning that around must be a priority. All workers should have access to a mid-life training review to assess their skills, and despite their chequered history, government will need to reintroduce individual learning accounts to give everyone a personalised budget for training.

Some workers will need more extensive support from government to safeguard their position in the labour market. Groups facing redundancy due to industrial change should have access to retraining programmes to equip them with the skillsets required in a digitalised economy.

Secondly, the TUC wants to see greater collective bargaining power amongst the workforce, to ensure that when the productivity benefits from increased automation do show up, the rewards are fairly shared. It notes countries with greater collective bargaining power have lower inequality in wages. However, it does not support the introduction of a robot tax to fund a new source of income from those displaced from the workforce. The report states:

Some have suggested that if robots threaten widescale unemployment, a tax on their owners could be used to help fund a Universal Basic Income.

We don’t think that dis-incentivising investment in robots and other technological developments is the right approach. These technologies have the potential to liberate working people from routine, tasks and drudgery, and so make jobs more skilled and satisfying.

But we do want to ensure that where these technologies lead to new wealth, the benefits are shared – both in terms of more free time and more money. Sharing the benefits of greater productivity is at the heart of Trade Unions’ mission.

Finally, the TUC looks at the government’s proposals for increasing the current age of retirement – suggesting that this decision should be reversed. It argues that if AI and robotics will lead to huge increases in GDP, this should enable a lower pension age. The report notes:

Finally, if technology threatens to reduce the total amount of work, and there is a need to look again at how work is distributed, we could start by looking at the pension age. At present, government is suggesting saving 0.3 per cent of GDP in 2066/67 by bringing forward increases in the state pension age to 68 for workers now in their forties.

Estimates of the productivity gain from artificial intelligence dwarf that figure, with PWC suggesting a 10 per cent boost to GDP by 2030 as a result of AI. If we do see those benefits arrive, reversing increases in the state pension age and enabling more people to enjoy a decent retirement should be a priority.

This would be one way to ensure that new technology enables a fairer share of the rewards from work, and to help those whose working lives may be disrupted by technological change.

My take

The TUC’s call for the government and business to plan for this rapid change in technology is an admirable one. Society and workforces have been caught out in the past, following extended periods of rapid innovation. Whether or not the government and business see this as a priority, however, is another question. Often, productivity and profits tend to be the main concerns, with little regard for the consequences. However, preparing for the change could ensure that the benefits are felt by more people than in previous decades.

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