In June 2020, the McKinsey consulting group commissioned a survey of global business executives about the post-pandemic future workforce. The survey responses clearly indicate a period of future disruption and change. Millions of low-income people have lost their jobs, and the survey indicates that the mix of post-pandemic jobs will look decidedly different from the pre-pandemic mix.
As work-from-home mandates were issued in many U.S. states and other countries, companies relied on technology to keep non-essential employees on the front lines. The vast majority of companies (85 percent) reported an acceleration of digitization, specifically with employee interaction and collaboration.
Half of the 800 respondents noted an increased digitization of customer channels via ecommerce, mobile apps, or chatbots. Approximately 35 percent of respondents reported increased digitization of their supply chains. Two-thirds of respondents indicated that their companies have accelerated automation and artificial intelligence (AI) applications.
The adoption of process automation and artificial intelligence platforms reflect companies’ desires to facilitate contactless interactions during a time when social distancing is mandated and employees are very aware and concerned about hygiene. The use of chatbots and other automated services builds corporate resilience without relying on virus-susceptible employees.
Companies in the financial services and technology sectors have seen the greatest acceleration of digitization and artificial intelligence initiatives post-pandemic. Approximately 88 percent of finance and insurance execs and 76 percent of information and technology execs reported the increased implementation of automation and AI since the COVID-19 pandemic began. Because these industries were already leaders in digitization and automation before the pandemic, they were able to leverage their existing technology base and leap forward more than any other sector.
Prior to the COVID-19 pandemic, opportunities for remote work were limited; many companies struggled with the potential ramifications to employee morale and corporate culture. The pandemic created the perfect pilot study for many organizations when 100 percent of non-essential employees were ordered to work from home.
While some companies plan to bring everyone back to the office when it is safe, more employers are considering to allow more workers to work remotely after the pandemic ends. Across all sectors, 15 percent of executives reported that at least one-tenth of their employees could work remotely two or more days a week going forward.
That percentage is nearly double the eight percent of respondents who expressed that intention before the pandemic. Only seven percent of executives stated that at least one-tenth of their employees could work remotely three or more days a week.
The data looks different for companies in certain sectors, such as information and technology, finance and insurance, and management. Some 34 percent of respondents from the information and technology sector said that they expect to have at least one-tenth of their employees working remotely for at least two days a week, an increase of nearly 50 percent from the 22 percent who responded to the survey pre-pandemic.
The McKinsey consultants state that it is important to note that more than 60 percent of all workers in the U.S. economy cannot work remotely as their jobs require some type of physical presence. Outside of the U.S., the percentage of workers unable to work remotely is even higher.
Nearly all respondents (83 percent) indicated that they would hire more people for health and safety roles when their offices reopened. Nearly 73 percent of executives said that they expected to hire more people to manage on-site physical distancing and sanitation. The McKinsey consultants write that this is an area where companies could deploy robots to clean floors, windows, and ducts.
When hiring for on-site roles, about 70 percent of the executives completing the survey indicate that they expect to use more temporary workers and contractors onsite than they did before the pandemic. The expected increase in use of temps and contractors may be due to the uncertainty of how the pandemic may return and how long it may last.
McKinsey’s consultants note that the increases in automation and digitization, increases in temp and contractor utilization, and increases in remote workers could deliver increased corporate productivity, decreased costs, and enhanced resilience. The trick will be in reducing the risk of unequal outcomes as well as preparing workers for these shifts.
I agree with McKinsey’s conclusions. At the same time, I am not as optimistic that companies will be able to manage unequal outcomes. Automation is easier to accomplish when you automate highly repetitive jobs. Those jobs are usually not the highest-paying jobs, nor do they always require an advanced degree. The assumption that companies can retrain lower level process employees in techniques of artificial intelligence is risky.
In May, I reviewed Daniel Susskind’s latest book, A World Without Work: Technology, Automation, and How We Should Respond. Susskind is an academic, but is also someone who works extensively with companies deploying technologies to become more effective and cost-efficient. He believes that many more jobs will be eliminated in the future, thanks to the successes of software and hardware advances. Unless countries require companies that eliminate jobs to retrain employees before their jobs are eliminated, I believe we can expect an unequal outcome as the better-educated and better-prepared employees will work to stay ahead of the position eliminations in their professions.
One fascinating fact from Susskind’s book is that new companies created after 2000 only employ .5 percent of all U.S. employees. Why? The new companies utilize technology to keep their costs down but also to acquire customers quickly. Susskind writes that if computers continue to advance over the next 80 years until 2100 at the same rate that they did over the previous 80 years (since 1940), that systems and machines will be a trillion times more powerful in 2100 than they are today.
The COVID-19 pandemic has already triggered articles and op-eds speculating that the implementation of technology will accelerate the decline of traditional higher education. I agree with many of those authors, but caution them on the pace of acceleration given the highly subsidized financing of public higher education.
Whether you work in higher education or some other slow-to-automate industry, I recommend reading Daniel Susskind’s book to open your perspective on how understated the survey results could be. The next 10 years will be filled with challenges and opportunities. Executives who understand the capabilities of technology will likely lead their companies to increased market share. Employees who are committed lifelong learners will likely thrive and survive versus those who do not increase their job responsibilities and skills. The road will be rough for many.