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The jobs of tomorrow -

The jobs of tomorrow

technology, productivity, and prosperity in Latin America and the Caribbean

By Mark A. Dutz, Rita K. Almeida, Truman G. Packard, Truman G. Packard

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While adoption of new technologies is understood to enhance long-term growth and average per capita incomes, its impact on low-skilled workers is more complex and merits clarification. Concerns abound that advanced technologies developed in high-income countries could inexorably lead to job losses of low-skilled, less-well-off workers and could exacerbate poverty. Conversely, there are countervailing concerns that policies intended to protect jobs from technology advancement would themselves stultify progress and depress productivity.The Jobs of Tomorrow squarely addresses both sets of concerns with new research showing that adoption of digital technologies offers a pathway to more inclusive growth by increasing adopting firms' outputs, with the job-enhancing impact of technology adoption assisted by growth-enhancing policies that foster sizable output expansion. The research reported herein demonstrates, using economic theory and data from Argentina, Brazil, Chile, Colombia, and Mexico, that low-skilled workers can benefit from adoption of productivity-enhancing technologies that are biased toward skilled workers, and often do.The inclusive job outcomes arise when the effects of increased productivity and expanding output overcome the substitution of workers for technology. While the substitution effect replaces some low-skilled workers with new technology and more highly skilled labor, the output effect can lead to an increase in the total number of jobs for less-skilled workers. Critically, output can increase sufficiently to increase jobs across all tasks and skill types within adopting firms, including jobs for low-skilled workers, as long as low-skilled task content remains complementary to new technologies and related occupations are not completely automated and replaced by machines. It is this channel for inclusive growth that underlies the power of competition-enabling policies and institutions - such as regulations encouraging firms to compete and policies supporting the development of skills that technology augments rather than replaces - to ensure that the positive impact of technology adoption on productivity and low-skilled workers is realised. Cross-country studies highlight additional channels from digital technology adoption to inclusive growth, namely by lowering the fixed costs of exporting through online trading platforms, and by reducing the cost of information about job opportunities through Internet-enabled worker-firm job matches.

Product code: 9781464812224

ISBN 9781464812224
This book summarizes new research on the impact of digital technology adoption on lower-skilled workers. Country studies on Argentina, Chile, Colombia and Mexico find inclusive growth due to the increased productivity and the resulting output effects on lower-skilled jobs.