Chapter 24

The future of work:

Facing the challenges of new technologies, climate change and ageing

Damian Grimshaw and Uma Rani

Forthcoming in T. Dundon and A. Wilkinson (eds.) Contemporary HRM: Text and Cases,
Pearson.

Introduction

There is a real urgency to questions about the future of work because of the complex and worrying

challenges facing everyone who is dependent on paid work for their livelihoods, as well as HR

managers, trade unions and governments who must navigate these challenges. Advances in technology,

the risks posed by climate change and population demographics present very difficult issues for the

future of work. New technologies have received by far the most attention. The current phase of

automation and artificial intelligence, like past waves of technological transformations, has instilled

fears of job loss and destruction, while the digital economy is creating new challenges by treating

workers as entrepreneurs who are responsible for earning their livelihood from one ‘gig’ to the next.

Climate change and demographic change also present huge questions for the future of work. The

dangers of climate change require firms, investors and governments to shift out of dirty industries and

dirty production methods into clean industries and clean production practices. But what does this mean

for transitions between jobs and how will the new skills be developed? Demographic changes in many

parts of the world mean a rapidly ageing population as fertility rates decline and life expectancy

increases. On the one hand, this means businesses and countries need to adopt ‘active ageing’ policies

so that older workers do not face discrimination in accessing and continuing paid work. On the other

hand, it requires considerable investments in a care workforce to care for more older people who will

have health needs at the same time as ensuring the work is decent and fulfilling.

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These future of work challenges are made more complicated by the fact that they must be confronted

in an unstable social, economic and political context, which make coordinated efforts of solidarity at

the sectoral, national and international levels more difficult. Scholars and policy makers are especially

concerned about the destabilising effects of high and rising inequalities, poorly regulated globalisation,

the retreat by several major economies from longstanding pan-national systems of governance,

persistent gender inequality and short-term, speculative financialisation (Ghosh 2019, ILO 2019a,

Milanovic 2016, Rodrik 2018, UNDP 2019).

Against this challenging backdrop, this chapter explores three dimensions of the future of work –

changing technologies, climate change and demographics. For each dimension it questions the

implications for HRM, while also considering the perspectives of workers, business, governments and

international organisations such as the United Nations. It adopts an international perspective because

the future scenarios of work and business among developed and developing countries are deeply

interconnected. For example, greater investment in robots in Europe may mean less manufacturing jobs

in Indonesia or Brazil because European firms would then reduce contracts for offshore production.

Similarly, a refusal to address global warming in the high carbon economies of developed countries

causes rising river and sea levels and the loss of employment and livelihoods in countries, such as

Bangladesh, where many people live near coastal areas. Also, servicing an ageing population in many

countries of the world requires an expanded care economy that is likely to rely heavily on the

international migration of healthcare workers. After exploring each of the future of work themes in turn

(sections 1-3), the chapter presents two case studies of businesses at the HR frontier of the new advanced

digital technologies.

New technologies and the future of work

Technological advances are bringing changes that are at once fascinating and fearsome. Robots and

artificial intelligence (AI) are increasingly a source of both enthusiasm and concern for governments,

businesses and workers alike. We hear about new robots for elder care in Japan, potentially replacing

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humans altogether. Yet in practice, many workers now work alongside ‘cobots’ (robots that collaborate

with humans) to deliver better quality services (to hospital patients or banking customers for example)

or to produce higher quality products. AI has advanced considerably and can now provide real-time

translation, for example, enabling international economic transactions, as well as the exchange of ideas,

information and data. At the same time, however, as a recent global survey shows, AI advances are

supported by an invisible army of ‘microtask workers’ (Berg et al. 2018). Dispersed around the world,

these workers undertake an array of repetitive, mind-numbing tasks, which are outsourced by businesses

and auctioned to workers through online digital platforms such as Amazon Mechanical Turk and

Microworkers.

Taking a bird’s eye view of the vast array of technological changes, it is becoming clearer that some

jobs will indeed be replaced, but others will be created anew and many will be transformed. These

transformations present major challenges for HRM, spanning recruitment, job design, training and skill-

mix strategies. Of major concern, however, is a sense that future changes may be neither ‘human-led’

nor especially guided by a concern for social justice. The HR function therefore needs to oversee

strategic change in order to retain a human-centered approach to the application of advanced digital

technologies. This section addresses the following questions:

 Should we worry about largescale job losses from new technologies?;

 What is new about digital platform business models?;

 Are digital technologies generating a new breed of precarious work?; and

 Is a new international approach needed to regulate the digital platform economy?

Job losses from new technologies

Technological change and innovations are not new, but the pace and speed at which they are taking

place are unprecedented. This has led in recent years to concerns about the extent to which automation

and robotisation might result in fewer jobs. There is no consensus in the literature about the potential

impact on jobs and the estimates vary substantially. Among the first studies, Frey and Osborne (2013)

estimated that almost half of all jobs in the United States (47 percent) were at high risk of automation.

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This spurred numerous studies, using similar and alternative forecasting models, which has produced a

wide variety of estimates (figure 1).

Figure 1. The potential risk of job loss caused by automation (selected studies)

a) Developing countries

b) Developed countries

Source: Authors’ compilation based on the cited studies.

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Figure 1 makes clear the discrepancy between developed and developing countries. It seems that

developing countries may be more highly susceptible to automation. Estimates of jobs at high risk of

automation include almost three in five jobs (56 percent) in Southeast Asian countries (Cambodia,

Indonesia, the Philippines, Thailand and Vietnam) and more than two in three jobs in India, China and

Ethiopia (69 percent, 77 percent and 85 percent, respectively) (Chang and Huynh 2016; Frey and

Rahbari 2016).

Research has also questioned whether it is an entire occupation that is prone to automation or rather a

specific task within an occupation. Models using a ‘task-based approach’ suggest the risk of job losses

is far lower, varying from 6 to 15 percent by country (Arntz et al. 2016; Nedelkoska and Quintini 2018).

Such studies reveal further uneven job effects: the risk of lower skilled jobs being automated is greater

than for higher skilled jobs. Thus, a key goal for labour market policy and HRM is to ensure that there

are effective retraining programmes for lower skilled workers.

Aside from improvements in modelling, new research is also calling for a more realistic understanding

of the many factors shaping the diffusion and adoption of technologies (Arntz et al. 2019). First, the

speed of diffusion may be slower than expected since decisions about automation are firm specific and

depend on whether managers believe the technology is feasible and economically viable. Replacing a

worker by a robot may be feasible but expensive to maintain. Also, since robots tend to be programmed

for a particular task they are less suitable in work settings requiring multi-tasking (Acemoglu and

Restrepo 2018a). In developing countries, where lower skilled, routine tasks predominate, the potential

to automate is high, but there is less incentive because labour is cheaper. Indeed, the empirical evidence

suggests diffusion so far has been slow. Rates of employment in almost all countries in the world are

high and rising, including in industries with high use of automation such as the automotive industry

(Graetz and Michaels 2018).

Secondly, the decision to invest in automation may be strongly influenced by concerns about an ageing

workforce. There is a strong correlation between countries with a rapidly ageing population (Japan,

Germany and South Korea – see section 3) and the use of industrial robots, since automation can

partially compensate for a shrinking workforce. One study suggests that ageing explains two fifths of

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the variation across countries in use of industrial robots (Acemoglu and Restrepo 2018b). The challenge

for HR managers is how to adjust work activities as a result of automation, and how to ‘unbundle’ and

‘rebundle’ tasks so that they are efficient for the company. At the same time, as technology alters the

way organisations work, the functions of HR managers also need to change and adapt to new situations.

A third factor is that forecasts about the human-replacing powers of AI and machine learning are

overstated in the short term. Nitzberg et al. (2019) argue that the AI software available today is suited

only for specific narrow applications and that general AI, which might some day perform cognitive

tasks similar to humans, is far beyond reach (see also Chapter 22 on HRM and Technology) Moreover,

there are limitations even with the narrow applications of AI. There is plenty of evidence that when HR

managers use AI for hiring practices, for example, the decisions are often discriminatory (Bodie et al.

2019). Similarly, while HR managers might adopt a ‘virtual assistant’ technology, say, in the belief

that AI is processing their requests and thereby replacing their workforce, in practice AI systems in use

today still operate as ‘human-in-the-loop’ systems wherein the tasks are outsourced to a global pool of

crowdworkers (see Case Study 24.1). So jobs will be lost and gained thanks to AI, leading to important

shifts in who does this kind of work and where, and also raising questions about the quality of the work

and nature of the employment relationship.

The rise of the digital platform – a new business model

Innovations in digital technologies have led to the ‘platformisation’ of the digital space and a radical

transformation of business and HR practices with huge implications for the future of work. Digital

platforms have permeated multiple sectors of the economy (including telecommunications,

transportation, retail and hospitality) and raised policy concerns about the dominance of a handful of

corporations in charge of the frontier technologies of tomorrow. Continuous innovations by Alphabet,

Amazon, Apple and Microsoft, among others, are transforming the economy and creating ripple effects

across family and working life.

Digital platforms can be separated out into two types – web-based platforms, which are performed

online and allocate tasks to the crowd (including microtasking) and to individuals (on freelancing and

software platforms) and location-based platforms, which are performed in real physical locations and

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tend to give tasks to individuals (figure 2). Far greater attention has been paid to location-based

platforms – Airbnb, Uber, Taskrabbit and others. Web-based platforms, such as Amazon Mechanical

Turk, Upwork, 99Designs or Topcoder, are still not so widely recognised but raise significant

challenges for the future of work and so are featured more strongly in the following analysis.

Figure 2. Categorisation of digital platforms

Tasks given to Competitive programming

Web-based Freelancer/ Contest-based

Tasks given
to the crowd Microtask
(e.g. AMT, CrowdAnalytics)
Digital labour
platforms
Tasks given to Taxi drivers
selected individuals (e.g. Uber, Ola)

Location-based Delivery workers

Household services
(e.g. Taskrabbit)

Source: Authors’ elaboration.

Web-based digital platforms enable all kinds of firms to outsource a diverse range of activities to a

geographically dispersed crowd (Berg et al. 2018). The online web-based categories of crowdwork can

be distinguished based on duration and complexity of tasks, remuneration and level of automation. The

first category are freelancing or contest-based platforms such as Upwork, Freelancer.com, 99Design

and others, specializing in particular fields, such as translations, financial services, legal services, patent

services, design and data analytics. The second category includes competitive programming (Topcoder,

HackerRank) whereby workers compete with one another to solve complex programming problems

within a designated time, with the winner(s) chosen by the clients to receive the award. The third

category are microtask platforms, in which workers complete short tasks such as data annotation, data

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entry, data cleaning, accessing content (for example, visiting websites or social media sites to increase

traffic), content moderation (the purging of violent and pornographic images from social media sites),

copywriting or audio transcription.

The speed at which tasks can be completed using these platforms is appealing to firms and is

transforming the way both work and business are organized. Digital platforms supplement a firm’s

internal HR capabilities by enabling seemingly fluid access to external skill sets, which can be scaled

up or down based on the firm’s needs. Some platforms, such as Upwork for example, market themselves

as providing business clients with access to varied skills and specialized talent from the global labour

market, at a quicker pace and lower cost compared to traditional employment agencies. A survey of

nine Fortune 500 companies found that platforms provided HR functions with cost effective and agile

staffing solutions related to content marketing, design, IT and data (Corporaal and Lehdonvirta 2017).

Competitive programming platforms enable both IT and non-IT firms (such as automobile

manufacturers, say) to expand their knowledge boundaries, to leverage deep technology and to build

new capabilities for their workforce (see Case Study 24.2).1 Digital platforms also provide firms with a

cheap alternative for processing big data, enabling them to scale up rapidly by substituting an in-house

workforce for an immediately available online global workforce (Berg et al. 2018.

Digital platforms and precarious work

The concentration of power associated with digital platform technologies raises major challenges for

countries and businesses that seek to establish secure and decent employment for their workforces. The

rapid success of Amazon, for example, has displaced thousands of jobs from traditional ‘bricks and

mortar’ retail stores and also arguably worsened the quality of new jobs in retail and the associated

logistics sector. In general, there is growing evidence that the quality of work associated with digital

platforms is precarious, meaning that it often lies outside the traditional scope of employment

protection, is irregular and poorly paid.

1Open-source community software platforms are developed by software communities and made available to users at zero
costs. They rely on digital platforms with highly skilled crowdworkers, such as Topcoder or HackerRank, to access flexible
expertise that can support research and innovation activities among users.

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Nevertheless, in developing countries where unemployment has been increasing and a large proportion

of workers are in the informal economy, digital platforms are attractive to governments as a strategy for

economic development as they have the potential to create income and employment opportunities.

However, digital platforms are expanding in a kind of ‘wild west’ scenario where the new business

models and advanced digital technologies are far ahead of today’s rules and regulations that govern

business and employment. This is why many legal observers argue that despite their potential, digital

platforms risk worsening the quality of work in many countries of the world because they subvert

customary HR practices and undermine conditions associated with the standard employment

relationship (De Stefano 2016).2

The empirical evidence points to problems with regard to platform workers’ legal status, their job and

income security, low earnings, non-payment of wages, lack of social protection and lack of collective

representation (e.g. Berg et al. 2018; Pesole et al. 2018). Moreover, the risk of exploitation is higher in

developing countries. For example, figure 3 shows differences in earnings among workers in India and

the United States paid on the Amazon Mechanical Turk platform. Hourly pay in India is highly skewed

to the bottom end and the difference with workers in the United States actually increased over time.

Median pay in 2017 for AMT platform workers was just $1.67 in India compared to $5.63 in the United

States. This reflects differences in living standards to some extent but also shows that income

opportunities generated by digital platforms are still unequally allocated between developed and

developing countries.

Figure 3. Distribution of hourly pay (paid and unpaid work) among workers on the AMT platform in

India and the USA, 2015 and 2017 (US$)

2 The standard employment relationship can be defined as the body of statutory rules and/or collectively negotiated rules
that establish protections for a worker in a specific country or industry.

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Source: Berg et al. (2018: figure 4.2)

The dramatic COVID-19 pandemic has revealed the enormous risks for platform workers who lack

social protection or the right to sick leave due to the absence of an employment relationship. Many

commentators and politicians around the world called for new regulations to make the platform

economy model more sustainable and to strengthen protections for platform workers. Senator Warner

in the United States said, ‘In order to limit the spread of COVID-19, it is critical that platform

companies lead by example by committing that economic uncertainty will not be deterrents to their

workers following public health guidance during the response.’ Also, an advocacy group representing

platform workers, Gig Workers Rising, highlighted the anxieties faced: ‘By continuing to deny us paid

sick leave, Uber and Lyft are doing nothing to prevent this public health crisis from worsening’.3

However, at the time of writing (March 2020) platform companies have not responded proactively and

continue to abdicate HR responsibility for their workforces, possibly out of a fear that workers would

then win ongoing legal battles to be recognised as employees and this status would become entrenched

after the crisis.

Digital platforms also raise questions about skill development. Each activity that is outsourced by a

client business and then uploaded onto a platform is unbundled via a matrix of algorithms into a discrete

3Both quotes are cited in the Los Angeles Times (06-03-20), https://www.latimes.com/business/technology/story/2020-03-
06/ senator-urges-uber-lyft-and-other-gig-companies-to-ensure-workers-financial-security-amid-covid-19-concerns.

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set of tasks and then further fragmented (typically into microtasks). There does not appear to be an

explicit HR strategy guiding the design of algorithms applied by platform companies. This is concerning

because the ongoing process of unbundling and fragmentation is deskilling work. It risks replacing or

displacing highly skilled and professionally certified labour with lower skilled labour in many activities,

such as translation, speech transcription and copy-editing. The worry is that we are witnessing the

creation of a global sweatshop of digital labour (Méda, 2019).

The related problem is that because digital platform companies do not self-identify as employing

organisations, they shift all the responsibility for training and skill development to the digital workforce.

This denial of HR responsibility generates three issues:

i) There is no portability of a worker’s performance ratings across different platforms. This means

workers become locked in to a single platform, rather than being able to build their reputation

and access new work opportunities across multiple platforms;

ii) Highly educated workers (including many with graduate level STEM education), especially

from developing countries, tend to perform repetitive, mind-numbing jobs on microtask

platforms, which represents under-utilisation of skills and a wasted investment for the worker

and country (Rani and Furrer 2019); and

iii) Relatedly, there is a proven disconnect between educational policies and the returns to

education (in the form of income) on online digital platforms for high-skilled services

(Herrmann et al., 2019).

A further feature of precarious work on digital platforms concerns the HR practice of ‘algorithmic

management’, involving use of algorithms, tracking devices and metric based feedbacks to control and

supervise workers (Choudary 2018). Worker surveillance is not new, but the extent to which it is carried

out using AI and other devices already exceeds expectations thanks to its power at processing big data

(de Stefano, 2018). On ride-hailing and delivery platforms, GPS systems monitor workers for

disciplinary measures, which impact their ratings and performance reviews without input from line

managers. On online digital platforms, workers must install software so that clients can track their

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working time and they have to provide screenshots at regular intervals (Aleksynska et al. 2018). Such

HR practices are not restricted to digital platforms. In traditional workplaces, managers deploy wearable

devices, monitor emails and track computer content in an effort to monitor workers’ performance

(Moore et al. 2018).

These studies suggest there are real problems for businesses of developing an ‘algorithmic-centred HR

function’. It generates a set of quantitative performance metrics that may well be appealing as a

straightforward input into executive decision-making (guiding downsizing, productivity and job design

decisions for example). However, the big data generated do not flag to executives how the numbers are

influenced by idiosyncratic human and work organisation contingencies, which would provide much

needed supplementary information. This is why a hands-on, ‘human-centred HR function’ is essential

to monitor and evaluate the future trends in working with new technologies.

Harnessing technological transformations for decent work

While a human-centred HR function will prove necessary for achieving a future of decent work in a

world of advanced digital technologies, it relies on having an effective base of labour institutions that

can protect workers and establish norms of decent employment standards. In challenging platform

companies to acknowledge their status as employing organisations and to assume the HR

responsibilities that all other businesses routinely manage, legal complaints around the world have

called for the extension of labour institutions to platform workers. This means granting workers the

protection of a statutory minimum wage, the right to maternity and shared paternity leave, access to

sickness benefits, full rights to working time rules (including annual leave, maximum weekly hours and

paid breaks), inclusion in pension and unemployment benefit schemes and the right to join a trade union,

among others. As it stands, while there have been piecemeal reforms, the bulk of platform workers are

unprotected and, as the coronavirus pandemic has so cruelly exposed, they have had to endure sole

responsibility for their earnings, social protection and safety. If this trend continues, then the current

technological transformations are likely to further increase inequalities and lead to more precarious

work and problems of wellbeing. It is therefore of utmost importance to harness the ongoing

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technological transformations in order to pursue the goal of decent work via improved labour

institutions and a human-centred HR function. The role of different stakeholders (especially workers,

business and governments) in this process is critical.

Two high profile international policy reports call for a ‘human-in-command’ approach. In these reports,

the ILO and the European Commission recommend that countries adopt measures to ensure all final

business decisions regarding the application of new technologies to work are taken by human beings

(EC 2017; ILO 2019a). Box 1 describes the European policy recommendations.

For the platform economy, the ILO’s Global Commission calls for an international governance system

that requires platforms (and their clients) to respect certain minimum rights and protections. It draws its

inspiration from the 2006 Maritime Labour Convention, which is a labour code for seafarers that

transcends geographical borders (ILO 2019a). Because the standard employment relationship remains

the centrepiece of labour protection, the ILO also calls all stakeholders ‘to review and where necessary

clarify responsibilities and adapt the scope of laws and regulations to ensure effective protection for

workers in an employment relationship. At the same time, all workers, regardless of their contractual

arrangement or employment status, must equally enjoy adequate labour protection to ensure humane

working conditions for everyone.’ (ILO 2019a: 38). The ILO also calls for regulation of data use and

algorithmic accountability in the world of work, as well as reformed taxation systems to ensure

companies with highly digitalized business models pay a fair share of taxes.

Box 1. EU policy recommendations for a human-in-command approach to new technologies

The European Economic and Social Committee identifies 11 areas where AI poses societal challenges: ethics;

safety; privacy; transparency and accountability; work; education and skills; (in)equality and inclusiveness;

law and regulations; governance and democracy; warfare; superintelligence, and makes a number of

recommendations. In summary, the report calls for:

 a human-in-command approach to AI, including the precondition that the development of AI be

responsible, safe and useful, where machines remain machines and people retain control over these

machines at all times;

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  a code of ethics for the development, application and use of AI so that AI systems are compatible with

the principles of human dignity, integrity, freedom, privacy and cultural and gender diversity, as well

as with fundamental human rights;

 the development of a standardisation system for verifying, validating and monitoring AI systems,

based on a wide range of standards in the areas of safety, transparency, comprehensibility,

accountability and ethical values;

 the promotion of AI applications that benefit society, promote inclusiveness and improve people’s

lives;

 stakeholders to work together on complementary AI systems and their co-creation in the workplace,

such as human-machine teams where AI complements and improves human performance;

 stakeholders to invest in formal and informal education and training for all so that people can work

with AI and also develop the skills that AI will not or should not acquire; and

 a detailed evaluation of EU regulations and opposes the introduction of a form of legal personality for

robots or AI.

Source: EC (2017).

Overall, the rapid pace of technological transformations poses enormous opportunities and challenges

for the HR function. On the positive side, new global digital platforms supplement an organisation’s

HR capabilities by providing ostensibly agile and cost effective skill solutions. On the other hand,

however, the explosion of business now undertaken on digital platforms is characterised (with some

exceptions) by an abdication of HR responsibilities, which generates risks for precarious work as well

as problems of quality and continuity of services supplied by platforms to client businesses. New

technologies offer a great deal of promise but also seem to be dumbing down many previously

professional work activities, leading to a deskilling process that is reducing the volume of high earning

jobs. Excessive use of AI can also create major problems of discrimination in recruitment and promotion

decisions. This section has suggested there is a choice for organisations - adopt a human-centred HR

function, which is able to steer new technologies towards expanding decent work opportunities for all,

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or be guided by big data (an algorithm-centered HR function) and maximise the flexible and cost-

reducing opportunities regardless of the human cost. Different organisations will make different

choices, which means effective labour institutions (designed by multiple stakeholders) are essential to

provide decent protections for all workers.

Climate change and the future of work

‘Our economies are the heirs of the first industrial revolution, driven by the use of hydrocarbons.

The coming industrial transformation must take us beyond the era of fossil fuels and develop

sustainable solutions to feed, house, and provide access to clean water, employment, and

industrial goods to 10 billion people by 2050. In a world of finite resources, growing demand

for goods and services will call for transitioning to renewable energy sources and greater

resource efficiency’ (Global Commission on the Economy and Climate 2018: 132).

Climate change, combined with efforts to slow it down by greening the economy, presents a second

formidable challenge for the future of work and HRM. Its importance is established in the United

Nations 2030 Agenda for Sustainable Development. Goal number 13 calls on all 193 UN member state

countries ‘to take urgent action to combat climate change and its impacts’. Such actions are likely to

bring new job opportunities, but will also require downsizing many industries that produce excessive

greenhouse gas emissions in order to limit the global temperature rise.

The world is already witnessing an increasing frequency of natural disasters, which are damaging work

and business activities, as well as destroying homes and people’s lives. In addition, rising temperatures

in many parts of the world are causing major problems of ‘heat stress’ for people working outdoors.

While businesses, consumers and workers can all act to make a difference, a new set of ‘green economy’

and ‘green business’ incentives and rules will be required for an effective transformation (see box 2).

The added difficulty, however, is that the environmental spillovers caused by business and consumer

activity are experienced globally. In a cruel twist of injustice, the effects of unsustainable production in

wealthy countries are mostly experienced by people living in low-income countries. The

Intergovernmental Panel on Climate Change warns, for example, that 7 percent of Vietnam’s agriculture

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land may be submerged by a 1 metre sea level rise. This will wipe out the jobs and incomes that have

supported livelihoods for generations and will require a well designed raft of institutions and policies

to ensure a ‘just transition’ for people and their families.4

This section addresses the key concerns of the climate change agenda from the perspective of the future

of work and HRM.

 How are the HR functions of businesses (in a context of changing government policy)

approaching the challenge of scaling back ‘dirty industries’?

 How can employers, governments and unions ensure a ‘just transition’ for workers to move to

clean industries?

Box 2. Time to change unsuitable measures of economic performance

Many flagship reports from international organisations are now calling for a radical change in the way countries

compete on outmoded measures of economic growth. As environmental economists have been arguing for

decades, the problem is that Gross Domestic Product (GDP) does not at all capture the type of growth that

would be associated with a Green Economy (Pilling 2018). Worse, GDP counts as positive many economic

activities that are harmful to the environment, including the extraction and sale of fossil fuels, and does not

count many of the negative spillovers caused by dirty industries, including damage to the environment and to

workers’ health.

In its fourth major report, the influential Global Commission on the Economy and Climate (GCEC 2018) has

the following to say about the limits of today’s economic indicators:

‘We know that we are grossly under-estimating the benefits of this new [Green Economy] growth

story. Current economic models are deeply inadequate in capturing the opportunities of such a

transformational shift, or the grave dangers of climate inaction. We need a new class of economic

models that can capture the powerful dynamics at play, including transformative technological

advances, preservation of essential natural capital, and the full health benefits of cleaner air and a

safer climate, including the containment of pandemic diseases’ (p. 8).

4 International guidelines for a ‘just transition’ are described below.

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 In a similar vein, the Global Commission on the Future of Work (ILO 2019a) has this to say about today’s

deeply problematic economic incentives for business success:

‘There is a need to explore innovative measures that require enterprises to account for the impact –

positive and negative – of their activities on the environment and on the communities in which they

operate. However, financial market conditions place strong pressure on businesses to meet short-term

financial targets and shareholder expectations. With incentives geared heavily to the delivery of short-

term benefits, enterprises can find it difficult to engage in longer-term planning and investment

strategies that would ultimately be more conducive to their competitiveness, growth and success and

the alignment of their activities with the human-centred agenda. We therefore see strong need for the

development of market-based incentives to help promote such alignment.’ (ILO 2019a: 49).

Source: See Bibliography for full details.

Downsizing dirty industries

A core feature of climate change actions is to green the economy by shifting economic activity –

production, consumption, investment and employment – out of industries that are heavily reliant on

traditional energy sources like oil, coal and gas. Such industries include the extraction and processing

of fossil fuels, transport (especially airplanes and road haulage) and many types of construction and

manufacturing industries. This presents a major challenge because while these industries are major

emitters of greenhouse gases, they are also important contributors to economic growth and employment.

For example, there are around 4.3 million workers in the coal mining industry in China and in India

coal accounts for around three fifths of all energy use.5 In the world’s fourth oil producing country,

Canada, the argument to expand further its enormous oil sands operations was made in part on the basis

of generating some 10,000 operational and construction jobs.6 Shifting away from longstanding tried

5 ‘The world needs to quit coal. Why is it so hard?’, New York Times 24-11-18, https://www.nytimes.com/2018/11/24/
climate/coal-global-warming.html (accessed 25-02-20).
6 ‘Canada’s plan for oil sands falls apart’, New York Times (26-02-20, page 6. The National Geographic (April 2019) describes

Canada’s immense oil sands operations as ‘the world’s most destructive oil operation’, including the destruction of habitats
for indigenous communities. Fortunately (for the planet), the latest business-led effort to expand operations failed.
(https://www.nationalgeographic.com/environment/2019/04/alberta-canadas-tar-sands-is-growing-but-indigenous-people-
fight-back/).

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and tested carbon-use economic models will therefore be difficult. However, as the International Trade

Union Confederation famously puts it, ‘There are no jobs on a dead planet’! (ITUC 2015). It is

important therefore to lay the foundations quickly for new opportunities in Green Economy sectors of

renewable energy, environmental services, public transport and organic agriculture among others.

HR managers will play a role in shaping the emerging pathway, although the contours of the path are

likely to be mostly influenced by government policy-makers and coalitions of business leaders. There

are currently three alternative pathways.

A ‘head in the sand’ approach is characterised by minimal interventions to shift out of fossil fuel

production and use. This unfortunately characterises many managers and governments who continue

with business-as-usual policies despite a raft of reports, campaigns and a worldwide youth movement

(thanks to Greta Thunberg7), calling on everyone to make an urgent and radical shift in approach to halt

the rising global average temperature.

The damage to economy and society from inaction, or only piecemeal change, is now widely

understood. Global occurrences of extreme weather events have increased significantly since the 1950s

and caused tens of billions of dollars in losses to business, communities and healthcare.8 Also, the

traditional fossil fuels energy industry is the largest emitter of harmful pollutants (sulphur dioxide and

nitrogen oxides among others), which cause millions of premature deaths every year especially in

developing countries.9 Coal, still the single biggest source of electricity worldwide, is said to impose

the most damage on health, but many countries (led by China and India but with financial backing

7 The young Swedish climate activist, Greta Thunberg, has had a massive impact, especially at the level of international policy-
making. As the lead protagonist of a worldwide youth movement, she is widely credited for transforming a rather ambiguous
anxiety about climate change among policy-makers into a radical agenda for economic and political action. Her provocative
talk at the UN Climate Action Summit in 2019 can be accessed at https://www.youtube.com/watch?v=KAJsdgTPJpU.
8
In 2019 it was reported that extreme weather events caused more than $100 billion of damage (see
https://www.theguardian.com/world/2019/dec/27/climate-crisis-linked-to-at-least-15-1bn-plus-disasters-in-2019).
9 The five countries with the highest incidence of premature deaths due to pollution are Afghanistan, India, Pakistan, Nigeria

and China (2016 data, ranked by deaths per 100,000) (https://www.statista.com/statistics/830953/deaths-due-to-air-pollution-

18
mostly from the United States) provide huge subsidies for its extraction and use and continue to build

new coal-fired power plants.10

HR managers may carry some of the blame for a head in the sand approach, in particular where they:

a) fail to make the business case for investing in new skills for green business;

b) ignore evidence of heat stress among workers; and/or

c) do not support workers seeking to transition to alternative green jobs.

In the Middle East, for example, many construction and agriculture companies do not have HR

mitigation strategies to address heat stress. A recent United Nations survey of workers in Qatar found

one in three workers reported symptoms of heat stress. Good HRM can make a huge difference. The

UN report recommends that HR practices should include medical screening, a clothing and hydration

strategy, allowing workers to direct the pace of their work and granting workers the autonomy to take

paid breaks as required (ILO 2019b). Where these practices are not adopted, a head in the sand HR

approach damages workers’ health and wellbeing.

A second response is ‘dirty industry migration’. Instead of shifting an economy’s reliance away from

fossil fuel production and use, this response involves the global offshoring of pollution-intensive

production from wealthy countries to low-income countries. This generates huge demand for jobs that

are often dirty, hazardous and unsafe, in which workers in low and middle-income countries produce

commodities and products for sale in wealthy countries. Examples of industries where managers have

shifted jobs to countries with weaker environmental and labour rights regulations include chemicals,

production of electronic appliances, plastics and rubber industries. These industries are associated with

above-average exploitation of the environment and its degradation (Kuna-Marszałek 2016). For

business in the wealthy offshoring country, the future of work benefits opportunistically from an

improvement in its (narrowly defined) Green Business credentials because the incidence of hazardous

and unsafe work is substantially reduced.

10 In 2018, United States investors provided a third of worldwide finance (35%) for coal power plants. Expansion plans are
largest in China and India, followed by Vietnam, Turkey and Indonesia (see data at https://coalexit.org/downloads).

19
It is all too easy for the HR function to be compromised in this situation. The problem is that without a

stronger international framework of regulations (especially around trade and FDI) and without a shift

from the pursuit of short-term profit to wider societal purpose, businesses worldwide will keep being

incentivised to seek out cost-reducing locations for dirty industries. In practice, this means businesses

will continue to seek locations where they can avoid environmental regulations that add to their

production costs, or that place limits on the disposal of industrial waste. Indeed, many businesses (and

their investors) choose to profit from ‘eco-dumping’. The role of the HR manager in this scenario is to

question the business strategy and to highlight the interconnections between measures of environmental

health and safety of workers in different production sites around the world.

Ensuring a just transition

The third response can be framed as ‘just transition’. Policy-makers – together with groups of forward-

thinking businesses and trade unions – design a long-term, institutional pathway that enables businesses,

HR managers and workers to transition out of dirty industries into clean industries. United Nations

agencies have been at the forefront of designing good practice around the world. The ILO provides

valuable guidance on what is required to ensure workers and local communities enjoy the protection of

a just transition (box 3).11

The policy challenges are formidable, especially in those local and national economies heavily reliant

on the carbon economy. At the aggregate level, it is expected that a successful worldwide transition

could generate a net gain in employment (GCEC 2018), but this positive future scenario depends on

having an effective set of HR policies in place. Without such policies, laid off workers risk suffering

long periods of unemployment, loss of income and growing household debt.

Box 3. International guidelines for a just transition towards environmentally sustainable economies

Through consultations with representatives of governments, employers and trade unions, the International

Labour Organisation (ILO) set out in 2015 its policy guidelines for a just transition. These are referenced in

11 The ILO has a ‘Green Jobs Programme’ which regularly publishes detailed analyses of real-world transition pathways to a
circular economy with valuable details of countries’ policy programmes – see https://www.ilo. org/global/ topics/green-
jobs/publications/lang--en/index.htm.

20
the UN’s Sustainable Development Goal 13, which calls on governments and other stakeholders to take

proactive measures to combat climate change. The ILO guidelines are wide-ranging and quite specific in their

level of detail, although they are not meant as a one-size-fits-all policy mix for all countries. The following

presents some of the key features:

 Guiding principles: ensure a commitment to social consensus (by engaging social partners, especially

trade unions, employers and environmental groups), gender equality and decent work;

 Policy coherence: mainstream environmental objectives across all policy areas of government and

upgrade technical capacities at regional and local levels and impact evaluation exercises;

 Cooperation: share best practice and collaborate on technical expertise and training, at all levels –

international, national, industry, local and enterprise;

 Social partners: give an active role in formulating, implementing and monitoring just transition

policies, promote active participation of their members and incorporate key issues into collective

bargaining agreements;

 Integrate sustainable development and a just transition into core policy areas:

o Macroeconomic and growth policies (including suitable taxes, subsidies and incentives, trade

policies and use of public funds);

o Industrial and sectoral policies (to stimulate demand in Green Economy sectors and ensure

social protections and reskilling programmes for workers downsized from dirty industries);

o Enterprise policies (provide an enabling environment for Green Economy businesses,

especially micro, small and medium-sized businesses);

o Skills development (coordinated with environmental policies and Green Economy skill

demands);

o Occupational, safety and health (assess OSH risks arising from all aspects of climate change,

reduce use of hazardous materials and workers’ exposure and include OSH in all

environmental certification schemes);

o Social protection (especially for workers facing major structural changes to protect incomes

and livelihoods; consider benefit portability for cross-border displacement of workers and

employment guarantee schemes);

21
 o Active labour market policies (help business and workers anticipate changing labour market

demands, support workers made unemployed and make employment services effective as

‘transition agents’).

Source: ILO (2015).

So what kind of policies are required? Retraining programmes are key. While many new employment

opportunities should arise in green economy sectors, such as renewable energies, whether or not a

worker’s skills will need to be re-oriented will depend on the closeness of tasks and occupational

knowhow between old and new jobs. It is estimated that two in three of the 71 million workers in the

world who would lose their job in a green economy future may in fact be able to find new work in a

similar occupation (in a different industry within the same country) (ILO 2019c). But this leaves many

workers facing huge difficulties in transforming their experience and skill-set and requires businesses

and governments to commit to significant targeted investments in training.

Figure 4 shows the 20 occupations most likely to be affected by a shift to a green economy and the

composition between ‘reallocatable jobs’ (destroyed but absorbed within new occupations) and jobs

that are ‘not allocatable’ (destroyed and not re-absorbed). New training programmes will require

considerable financial investment. For example, China invested $15 billion to assist workers downsized

from the coal mining and steel industries, around 2 million workers. As well as early retirement

assistance for firms, the new policies help workers find new employment via schemes for relocation

and retraining, as well as via subsidies to boost HR capabilities to internally redeploy workers.12

Figure 4. Occupations most susceptible to job destruction and reallocation in a global green economy

scenario, 2030

12 Reported in the Financial Times, 29-02-2016, https://www.ft.com/content/3a8dd2e0-deb4-11e5-b072-006d8d362ba3

22
Source: ILO (2019c: figure ES 4).

Country experience also shows that social dialogue among HR managers and trade unions, as well as

engagement with local community organisations, is essential to ensure a just transition. The potential

for social and political conflict is especially strong in local economies that are strongly reliant on fossil

fuel power generation. Many countries have designed multi-stakeholder dialogues to set out ‘just

transition’ pathways for workers and the local communities. Germany has established an independent

commission, seen as a model for ‘just transition dialogues’, with diverse representatives charged with

managing the phase-out of coal in line with its climate commitments. Also, in Italy trade unions won

an agreement that the closure of 23 coal-fired power plants would not mean compulsory redundancies

(GCEC 2018: 57).

Overall, the responsiveness of the HR function to the challenges of climate change depends on the

ability of organisations and the community of HR managers to learn new capabilities and share best

practice. A proactive and multi-level perspective is required (Renwick et al. 2016) since green HR

practices need to mesh with new government policies concerning future industry trends and skill needs.

HR strategy may also play a leadership role both in designing practices to mitigate the worst effects of

23
climate change, such as heat stress for example, and in forging creative multi-stakeholder alliances to

apply schemes of redeployment and reskilling for transitioning workers.

Ageing populations and the future of work

In Japan, the ‘oldest country in the world’, one in three people are at least 60 years old and this is

forecast to rise to 42 percent of the population by 2050 (UNDESA 2017). For several decades, Japan’s

birth rate has been falling and has for many years been below the country’s estimated replacement level;

in 2019 it was just 1.4, far lower than the 2.1 children per woman considered necessary to hold the

population steady. At the same time, life expectancy has increased significantly. This ‘demographic

shift’ has generated huge controversies and debates in Japan about how it addresses the resulting

challenges for the future of work. What are the best ways of developing a care workforce for the elderly

while also ensuring care work is fulfilling and decent? How can HR managers design decent

employment opportunities for older people where needed, especially to reduce instances of age

discrimination at work? Also, perhaps most controversially, should migration be encouraged to fill out

the working age population groups?

Right now, Japan is at the extreme end of current policy debates about ageing and not representative of

average country experience around the world. However, all countries are ageing and so the case of

Japan throws into sharp relief the challenges for the future of work. Moreover, by 2050, many more

countries are expected to have more than a 40 percent share of older people in their population,

assuming no change in migration trends (table 1).

Table 1. Ten countries with the largest share of persons aged 60 years or over, 1980, 2017, 2050

1980 2017 2050

Rank Country/area % aged 60+ Country/area % aged 60+ Country/area % aged 60+

1 Sweden 22.0 Japan 33.4 Japan 42.4

2 Norway 20.2 Italy 29.4 Spain 41.9

3 Channel Islands 20.1 Germany 28.0 Portugal 41.7

24
 4 United Kingdom 20.0 Portugal 27.9 Greece 41.6

5 Denmark 19.5 Finland 27.8 South Korea 41.6

6 Germany 19.3 Bulgaria 27.7 Taiwan (China) 41.3

7 Austria 19.0 Croatia 26.8 Hong Kong (China) 40.6

8 Belgium 18.4 Greece 26.5 Italy 40.3

9 Switzerland 18.2 Slovenia 26.3 Singapore 40.1

10 Luxembourg 17.8 Latvia 26.2 Poland 39.5

Source: UNDESA (2017: table 2).

Context: Understanding the demographic shift

Japan and Europe are at one end of the demographic shift in large part because the underlying dual

trends of falling fertility (‘ageing from below’) and longer life expectancy (‘ageing from above’) started

far earlier than in other regions of the world. In Germany, for example, the number of childbirths had

already fallen to the replacement rate of 2.1 by 1950 (it has since fallen further to around 1.5 in 2020)

and life expectancy has increased rapidly from an already relatively high level - from 67 years for a

person born in 1950 up to 81 years in 2020.13

In sub-Saharan Africa, these same trends have only started far more recently. The average fertility rate

for the region remained at 6.5 and higher through the 1950s right up to the mid-1980s and only then

began to decline slowly (see figure 5). Life expectancy has also increased but from a very low level –

from just 40 years in 1960 up to 61 years by 2020. The result is a young population, with only 5 percent

aged 60 years and more (expected to double to 10 percent by 2050).

China is a special case because it has sought to control population growth over decades, including the

One Child Policy. Therefore, its rapid demographic shift is both a function of development (as in all

countries, thanks to greater access to education, health and good incomes) and a direct result of

government measures. China’s fertility rate dropped sharply from around 6.0 in the 1960s to around 1.5

by the mid-1990s. Also, the share of people aged over 60 years old was only 7-8 percent right up to the

13 All population data refer to United Nations data available at https://population.un.org/wpp/

25
early 1990s, similar to Sub-Saharan Africa, but then rapidly increased to 17 percent by 2020 (expected

to reach 35 percent by 2050).

Figure 5. Diverse patterns of declining fertility rates in China, the EU and Sub-Sahran Africa, 1950-

2017

0
1966

1972

1978

2010

2016
1950
1952
1954
1956
1958
1960
1962
1964

1968
1970

1974
1976

1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008

2012
2014
China EU Sub-Saharan Africa

Source: Authors’ compilation using UN population data.

Despite the universality of the demographic shift therefore, there is not a uniform experience across

countries. In particular, there are key differences in a) the timing of the demographic shift, b) the starting

point and c) the pace of change. These country differences result in very different population

compositions and provide an essential backdrop for thinking through the future of work policy

challenges explored below.

Investing in a care workforce for the elderly

Investment in the care economy and its workforce is now widely understood as an essential measure to

meet the growing needs of rapid population ageing in many countries. Improving the quality of paid

care work and bringing more unpaid care work into the arena of paid employment has two additional

major benefits – a) it reduces unfavourable dependency ratios (namely, high shares of the non-working

26
population versus the working population, which makes funding pensions difficult) and b) it improves

gender equality since women are over-represented among the world’s care workforce. However, this

requires major long-term financial commitments and a holistic approach to improving working

conditions in order to attract a workforce able to deliver more and better care services.

Because care work comprises of care for children, for people with disabilities and for the elderly, the

precise investment needs depend on a country’s demography. The pressures for rapid investment in

elderly care are felt most acutely in high-income countries where care dependency ratios for the elderly

have increased most rapidly since 2000 (ILO 2018a: figure 1.5). In the UK, for example, there is

expected to be increasing numbers of people over 75 years old with complex care needs requiring a

larger and more highly skilled care workforce. So while people aged 65-74 years old will be increasingly

independent, thanks to better health, the increase in longevity also brings many more older people with

care needs. The number of people in England aged over 85 years old needing care is forecast to rise

from 1.02 million in 2015 to 2.28 million in 2035 (Kingston et al. 2018).

So what policies and HR strategies are required to engage more care workers to deliver high quality

care? The ILO recommends a ‘5R Framework for Decent Care Work’. This framework calls for a

joined-up policy response to the care economy that connects with macroeconomic policies (to promote

investment), social protection (to support funding for elderly care and entitlements to care), labour

policies (to pursue decent care work) and migration policies (to balance supply and demand pressures)

(figure 6).

Figure 6. The ILO’s 5R Framework for decent care work

27
Source: ILO (2018a: figure 6.1).

Recognition of unpaid care work requires new instruments to measure the scale of unpaid work in order

to inform the design of active labour market policies to integrate and progress unpaid carers into the

formal labour market. The increasing application of time-use surveys has vastly improved our

understanding of paid and unpaid work and the contribution of both forms of care work to national

wellbeing (Figart 2017). The reduction and redistribution of unpaid care work requires radical change

in outmoded gender stereotypes since these both reinforce women’s role as primary care givers and

contribute to the undervaluation of care work. Better rewards for decent care work in the future is

perhaps the most challenging of the policy measures because it requires a commitment to a revaluation

of skills required for care work via new certification schemes, increased financial provision for elderly

care services (since the price of services determines the scope for wage rises), the proper regulation of

part-time and temporary employment contracts and entitlements to standard social protection. Finally,

care workers need to enjoy collective representation in order to pursue their interests since the scale

of change required is likely to require multiple resolutions of conflicts along the way (ILO 2018a). In

each of these areas, HR managers are expected to play a major role in facilitating dialogue, designing

new strategies of reward and skills accreditation and in making the business case for a radical

28
investment in the care workforce. As Kessler et al. (2017) demonstrate, such interventions require a

form of ‘HRM innovation’ that is complex and deserving of considerable organisational support.

Migration of workers with care skills

Migrant workers provide a major source of skills for the elderly care workforce in high- and middle-

income countries and their importance is likely to increase with rising demand. This generates an

interesting tension in some high-income countries where there has been a shift towards more restrictive

migration policies, although it is notable that Japan softened its migration rules in 2019.

While migrant workers are often perceived as a convenient shortcut to meeting a gap in labour supply,

it is important to recognise that they are, on average, at greater risk of exploitation compared to the

native workforce. Detailed country studies of the status of migrant workers in the care economy (e.g.

King-Dejardin 2019) reveal they tend to be:

 overqualified for care work (with many holding professional nurse qualifications);

 employed in the lowest tier of the care workforce;

 discriminated against by employers regarding the scheduling of hours of work (such as choice

of shift work or use of zero hours contracts);

 providing care work as a domestic worker privately employed by a household;

 employed informally and/or in a precarious form of work; and

 sending a portion of their salary to family members in their home country (‘remittances’).

Major flows of skilled migrants to richer countries can of course also create a problematic drain of

resources from the sending country, whether from Brazil to Portugal or from Ghana to the UK. There

are, however, instances of sending countries that purposefully establish an industry of recruitment

agencies and training providers oriented to the overseas care market with the goal of growing national

income from remittances. The Philippines is illustrative. Total remittances from overseas workers to

families in the Philippines amounted to around $34 billion in 2019, almost 10 percent of GDP.14 Care

14 World bank data, available at https://www.worldbank.org/en/country/philippines/overview.

29
work in high-income countries thus provides an important income flow for low- and middle-income

countries and the migrant workers deserve proper social and employment protections.

Active ageing (and tackling age discrimination)

In a context of ageing populations, many observers are calling for new ‘active ageing’ policies to ensure

continued access to paid work for those who need it and to combat age discrimination.

The goal of active ageing policies is to ensure that older workers who wish to remain economically

active enjoy suitable opportunities. As the ILO’s (2019a) Global Commission report suggests, this may

mean HR managers offering older workers (and indeed all workers) the choice of flexible hours,

including reduced hours and teleworking; it may also involve providing opportunities for partial

retirement combined with paid work. Ageing is also likely to mean more people at work experiencing

poor health, including disabilities. This means employers need to provide adequate sickness benefits

and arrangements for workers with disabilities.

However, perhaps the most difficult challenge is to overcome age stereotypes that equate older age with

lower mental and physical abilities, despite a lack of empirical evidence. HR managers need to monitor

hiring decisions so as to root out age discrimination. They should also review remuneration practices to

ensure that the accumulated skills and past work experience of older workers looking for work are

adequately reflected where possible in salary offers. Without a strategic, proactive response at the

organisational level, governments will find it difficult to achieve the goal of longer working lives that

underpins ongoing pension reforms (Oesch 2019).

Indeed, the subject of pension reform is critical for an effective active ageing policy. Without access to

a decent pension, older workers are forced to continue in paid work. This is a problem for around one

third of the world’s population older than retirement age who do not receive any form of pension15 and

who often have to continue to work in low-wage jobs whether in subsistence agriculture, retail or

15 Worldwide, 32 per cent of people above retirement age do not receive a pension, either contributory or non-contributory
(ILO 2018b: figure 3)

30
hospitality, because they cannot afford to stop working. A decent pension is therefore the first measure

to provide older workers the choice to continue working or not and also to prevent old-age poverty.

Overall, new and/or strengthened HR capabilities are required to deal with the future of work challenges

of an ageing population. Expanding a care workforce is essential but requires heeding the calls from

feminist scholars, as well as trade unions, for a new approach. At its core is a revaluation of caring skills

to remove the gender bias inherent in the care economy. Short-term, ad hoc interventions to boost the

labour supply (such as recruiting from temporary work agencies) are unlikely to prove sustainable and

may undermine morale and staff retention (King et al. 2017). Further HR capabilities are required to

promote a workplace environment amenable to the ‘active ageing’ agenda of many countries, involving

anti-discrimination policies and flexi-work practices among others.

Case studies of the future of work

Case Study 24.1: ‘Jordan’ the automated Virtual Assistant

One of the promises of advanced digital technologies is a fully automated Virtual Assistant for business,

which would replace human secretarial tasks such as scheduling appointments, taking notes at meetings

and managing mails. A number of startups have sprung up in recent years to provide virtual assistant

services. This case study focuses on the business and HR strategy for automating a ‘virtual assistant’

for scheduling meetings by a startup company referred to here as ‘Jordan.com’.16 It discusses the reality

of developing an AI-driven product and explains the significance of a ‘human-in-the-loop’ system. The

case raises key questions for HRM about the integrity of new strategies to deploy human resources in

support of ostensibly automated services.

Company background

Jordan.com was set up in San Francisco in 2014 to provide business clients an automated service for

the scheduling of meetings. The company raised US$120,000 as seed capital and a further US$7 million

16 This case is based on the detailed investigation of an actual start-up company. The real name has been changed to
Jordan.com (and the product to Jordan) in order to preserve anonymity.

31
from venture capital funds. It sells monthly subscription packages ranging from US $99 to $399. By

2019, Jordan.com had around 350 clients and a workforce of 18 in their San Francisco office (technical

and engineering staff who develop the AI) plus around 200 workers around the world performing

microtasks.

The product, sold as ‘Jordan’, is a Virtual Assistant who coordinates and schedules meetings. The goal

is the following. Instead of multiple mails back and forth, a client can simply copy Jordan into all emails

that refer to meeting requests. Jordan then schedules the meeting and enters it in the business calendar

in less than 45 minutes. The company claims it is continuously improving Jordan with the help of smart

and self-motivated ‘Jordan Remote Assistants’. Clients have praised Jordan for its efficiency and

accuracy, which the company says is thanks to its combination of precise machine intelligence and the

judgment of an expert human team. But what does this mean in practice?

The challenge of automating the ‘Virtual Assistant’

The challenge of automating a meeting schedule is that it requires the ability to understand the often

idiosyncratic requirements of clients expressed in an email. For humans, this is a function of our natural

language processing intelligence, but for AI it requires an additional largescale input of data about

customer preferences and behaviour in order to predict patterns and thereby train the AI.

For example, a Virtual Assistant, such as Jordan, is still not able to understand or process the following

email, ‘Hey, I can do a call next week’. According to AI developers at Jordan.com, the wording of this

message makes it difficult for AI to understand that: a) the sender is requesting for a meeting; b) the

type of meeting request is a call; and c) the meeting is to be scheduled next week.

It appears that human expertise is still required even for this rather simple message so that the

information can be decomposed into a structure that AI can process.

Implementation strategy for building and perfecting AI

Jordan.com implemented its strategy to develop and automate the Virtual Assistant service in two

phases, as follows.

i) Fully human phase

32
 The goal of the ‘fully human phase’ was to build up the client base so that technicians could

collect data and train AI for organizing meeting schedules. It had three stages:

a. First, the company’s founders themselves manually connected different calendars,

messaged people and scheduled the meetings. They learned that the key qualities of a

virtual assistant were good communication skills, intuition and a pleasant

communication style;

b. To expand their client base, Jordan.com hired workers from Upwork, one of the largest

web-based digital labour platforms, and trained them to schedule meetings manually;

and

c. As the client base expanded, Jordan.com designed its own digital labour platform called

‘Workplace Jordan Remote Assistant’ (JRA), thus replacing Upwork.

ii) Hybrid Phase (human-machine interaction)

In the second ‘Hybrid phase’, AI developers at Jordan.com attempted to automate the workflow

and build algorithms so that over time it would become cheaper to perform the scheduling tasks

by reducing reliance on the growing JRA platform workforce. This process involved a

combination of human processing and machine learning, a ‘human-in-the loop’ system. The

workers on the JRA platform performed two types of discrete microtasks.

The first microtask was to extract all the parameters relevant for scheduling the meeting

(availability of the participant regarding location, date and time) from the email into a decision

tree. The second microtask related to whether the information collected and labelled on the

decision tree was correct or not. This information was then used to train the AI. The system

was designed in a way that humans could review the output and correct it (fix, edit or change

it). The system also included a feedback loop, which allowed the software and engineering team

to train the AI and improve the predictions of the model.

Final Outcome

33
Jordan.com continues to provide the Virtual Assistant service with a human-in-the-loop in 2020 despite

its ambition when it was first established of developing a fully automated service. At this stage, there

is constant human-machine interaction throughout the entire workflow process in which human

judgement for reviewing final decisions is critical. So administrative scheduling tasks have only been

partially replaced by AI. The truth is that work has been dispersed in the form of thousands of

microtasks around the world to an invisible online crowd of workers. The JRA platform workers work

in around 10 different countries, including the Philippines and the United States.

On its company website, Jordan.com now explicitly mentions that scheduling workflows are efficient

and precise because they combine machine learning and expert human support. It had become clear to

Jordan.com that the development of a Virtual Assistant that can deliver 90 percent precision through

AI language processing alone would not in fact be sufficient to attract and sustain a viable client base.

The CEO of Jordan.com admitted that ‘AI has a long way to go before it can completely replace

humans’.

Questions

1. What are your thoughts about automation after reading about Jordan.com’s experience of

developing a Virtual Assistant?

2. Do you think it is morally and ethically right for companies to state that they are providing Virtual

Assistant services, when in reality the tasks are performed by a combination of humans and AI?

3. Governments and private sector businesses are investing massively in AI and machine learning.

What can they do to ensure responsible investments in AI that will benefit individuals and society?

Case Study 24.2: Wipro’s new strategy to develop HR capabilities and innovate in the era of digital

platforms

IT companies have responded to new advanced digital technologies by changing their recruitment

practices to build new capabilities, innovate and compete in the rapidly changing market. In particular,

34
the emerging platform ecosystem presents IT companies (and others) with valuable opportunities to

build their capabilities.

Wipro Limited (hereafter Wipro) was set up in 1982 and emerged as one of the three global companies

in India providing high quality IT-enabled services. Since the early 2000s, it has provided a range of

services to clients, including data analytics, AI and cloud computing. The shift from traditional IT

services to integrated services in specific industries meant that Wipro had to build and/or acquire a

completely new skillset, especially to emphasise business strategy and design skills. This case study

interrogates four key features of Wipro’s strategies, which were put in place with a view to building

new HR capabilities in a context of a national shortage of talent.

i) To align the business strategy with the HR talent strategy

Wipro radically shifted its approach to recruitment. Instead of hiring workers with ‘I-shaped’

profiles (involving in-depth knowledge and expertise in a particular technology, such as Java) or

‘T-shaped’ or ‘Pie-shaped’ profiles (in-depth knowledge and expertise that can be applied to

different industries), Wipro hires workers with ‘X-shaped’ profiles (software and design expertise,

along with detailed knowledge of business strategy and implementation). Wipro managers also

rotate workers every two years among different industry lines to increase their exposure to different

industries, as well as to transfer knowledge among industry clients, while continuously learning

new skills.

ii) To leverage deep technology expertise to provide innovative client solutions

Wipro explored a variety of crowdsourcing initiatives to meet this strategic goal. In 2016, it

acquired Topcoder, a platform marketplace. The platform brought together a staggering 1.5 million

developers, designers, and data scientists. In 2017, with the help of Topcoder, Wipro developed an

internal crowdsourcing platform – Topgear – for training. Wipro launched a new ‘Hybrid crowd

platform’ to revolutionize talent resourcing internally and for its enterprise clients, with the aim

of enabling a transformation of the workforce and establishing a more flexible workforce for the

future. According to K R Sanjiv, the Chief Technological Officer of Wipro Limited,

35
 ‘Hybrid crowd platform is the cornerstone of Wipro’s ongoing digital transformation and

it enables the team to provide an even broader spectrum of digital services and meet just-

in-time requirements. It also gives our digital transformation experts [Wipro employees]

increased opportunities to learn new skills, earn, and gain recognition by competing in

crowdsourcing competitions.’

The Hybrid crowd platform is presented as an opportunity for Wipro teams:

 to support employees in learning and applying skills to a range of projects;

 to develop their design, coding, testing and data science tools and expertise by

crowdsourcing tasks or projects to developers;

 to provide multiple innovative solutions to their clients;

 to hire platform workers for specific projects within a short time span, enabling

flexible resourcing;

 to post complex problems on the platform as a ‘challenge’ for prize money; and

 to hire the best talent on the platform for the company.

For instance, one of the ‘challenges’ was to produce an AI solution to treat a critical lung tumor in

ten weeks, with a prize of US$55,000 in 2017. Over the 10-week challenge, 564 contestants from

62 countries participated, reflecting the enormous spread of the platform workforce. Of these 34

contestants submitted 45 algorithms, Wipro selected seven winners. Moreover, it was able to

develop further 45 innovative ideas to explore AI solutions for cancer treatment. It is unlikely that

Wipro could have produced so many solutions in-house or through sub-contracting to a specialized

firm.

iii) To encourage collaboration and innovation

Wipro organised internal and external hackathons and ideathons both to develop skills and expertise

among their employees and to generate innovative solutions via internal teams and/or platform

workers. This allowed employees to compete either individually or in teams for the challenges

posed by their clients. Multiple winners were rewarded and their achievements were widely

36
 publicised within the company. The contest model allows employees to evaluate their skills

against their peers, but the open, informal nature of the gamified training encourages

communication and support. Senior managers claim this strategy boosted commitment among

employees and had a positive impact on their performance and productivity. In addition, the

hackathons and ideathons were also used to attract best talent that could be hired by the company.

iv) To align and partner with key stakeholders in the platform ecosystem

Wipro developed different strategies to be a frontrunner in new technologies by:

 investing in an ecosystem of start-ups and partnering with Microsoft accelerators

to tap into innovations;

 establishing long-term partnerships with clients to identify solutions in emerging

technologies such as blockchain or AI in their respective industry; and

 collaborating in open innovation with opensource software communities such as

Hadoop, SourceForge and others.

These strategies also enable Wipro employees to hone their skills and expertise, and to become part

of a wide network of experts to solve complex problems for their projects.

Questions:

1. What are your thoughts about Wipro’s recruitment strategy?

2. What do you think is the future of ‘T’ or ‘Pie-shaped’ profile workers in the labour market and

how might people with IT skills develop an ‘X-shaped’ profile?

3. Is the strategy adopted by Wipro to leverage its expertise through crowdsourcing sustainable in

the long run?

4. Do you think the platform helps the company to develop its in-house capabilities and if so how?

And what are the tensions with the platform workforce?

37
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