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Doc. 7713
20 December 1996
REPORT1 on new technologies and employment
(Rapporteur: Mr Pierre BEAUFAYS, Belgium, Group of the European People's Party)
Summary
The mass introduction of new technologies is generally leading to major economic and social change, and one of the most negative effects of this is unemployment. Only much later, when the new "techno-social" model has been established, does a period of expansion and growth set in as a result of the widespread use of the innovations facilitated by such new technologies.
A new revolution, similar to the old steam and electricity revolutions, is under way, tied up with the history of the new information and communication technologies (ICT). While they hold promise of a rich harvest of attractive and interesting jobs for many Europeans, their quantitative effects on employment in the short and medium terms have to be assessed. For this reason, the authorities must endeavour, in their actions, to strike a balance between social solidarity and the urgent need for the system to adapt itself.
Switching over to an Information Society presupposes a forecasting exercise (technology watch) and an effort to update education in order to prevent mismatches between technological and social development. Introducing new methods and strategies in the human resources field can help improve the use of ICT at local and regional levels.
In-depth social dialogue, the drafting of collective agreements tailored to the new working methods and occupations and the measures necessitated by the advent of the new ICT might be accompanied by a reflection on working time.
I. Draft recommendation
1. The new technologies are generally held responsible for major economic and social changes taking place in our societies, in particular the negative consequences such as unemployment. However, the dynamic relationships between technology and employment are complex and difficult to quantify.
2. Often these relationships are described as a form of "creative destruction", which means that initially the introduction of a new technology may lead to social and economic upheavals. The positive effects are felt only much later and result from the dissemination and widespread use of several innovations linked to the new technology. These knock-on effects are known as "technological clusters".
3. In reality, the effect on employment is only one of the numerous features of the new technologies. Their mass introduction utterly transforms the organisation of production and labour, the functioning of economic and financial institutions, the education system, etc. The success achieved by the introduction of a new technology therefore depends to a large extent on the length of time needed for society to reorganise and adapt. Periods of expansion and growth only follow once this new "techno-economic" or "techno-social" model has been implemented.
4. Like steam, electricity and the automobile which have profoundly altered our societies, a new revolution is now under way. This revolution is tied up with the history of computers and, having radically transformed industrial life (robotics) and services (computerised office equipment), it is now reaching fever pitch with the introduction of new information and communication technologies (ICT).
5. More than any other new technology being developed (biotechnologies, new materials, etc) ICT have the potential to bring about a radical transformation by by-passing space and time in disseminating information. In a world economy based on knowledge, it is obvious that ICT are particularly tailored to needs which means that they are full of promise. However, their effects are still few and far between.
6. As far as the putative effects of ICT on employment are concerned, reactions vary from optimistic euphoria to complete scepticism. Despite the often reassuring declarations from the Commission of the European Union and OECD, at present, ICT possibilities are under-exploited and the multi-media industry, on which so many hopes are pinned, does not seem to be a sufficiently strong source of growth.
7. It must be concluded that, regardless of their quantitative effects on employment in the short and medium term, ICT must also be appraised in respect of their qualitative impact on tomorrow's working patterns. Although there is no doubt that the ICT hold promise of a rich harvest of attractive and interesting jobs for many Europeans, they may also create exclusion among those who find it difficult to switch from working in a "real" world to working in a "virtual" world.
8. The action to be taken by the authorities concerning the relationship between new technologies and employment is doubly difficult: on the one hand, there is no simple response, and the overall strategy must be multidimensional and include structural, macro-economic, educational and other policies. On the other hand, a sensible balance must be struck between a strong tradition of social solidarity, a feature of European society, and the urgent need for the system to adapt itself. It should be recognised that saving condemned jobs "at any cost" is only treating the symptom and slowing down the process of creative destruction.
9. The authorities nevertheless have the possibility and the duty to act as a catalyst in co-ordinating the introduction of new technologies and developing human resources. The Assembly therefore asks the Committee of Ministers to invite the governments of the member states to take inspiration from the following measures which, although not an exhaustive list, represent the vital elements for integrating the new technologies and, in particular, switching to an information society as smoothly as possible:
i. improve access to knowledge and its diffusion, strengthen the links between industry, universities and research bodies;
ii. strengthen education and training in science and technology in schools in order to prepare the public better for the upheaval created by technological advances and facilitate their occupational adaptation in the future;
iii. greatly improve diagnostic tools in order to gauge the performance of research and development nationally and create machinery to improve the evaluation of the current or projected effects of new technologies; this forecasting exercise (technology watch) must be carried out very early in the process in order to avoid mismatches between technological and social development;
iv. start a Europe-wide dialogue to compare experiences and draw up an inventory of "good practices" (of successful cases) of management and structural adaptation concerning the impact of new technologies;
v. apply incentives to encourage better organisational measures in businesses including their human resource strategy, and create the infrastructures needed to optimise the application of ICT and their beneficial side-effects for competitiveness and, by extension, their potential spin-off for job creation;
vi. assist the innovative and job-creation capacity of small and medium-sized businesses, by facilitating their access to international innovation networks, in particular those businesses whose technology has a high expansion potential;
vii. take advantage of work relocation possibilities offered by new ICT in their job creation policies in isolated areas, nationally and Europe-wide;
viii. encourage regional and local authorities to play a constructive role in installing information highways, thereby influencing spatial planning and social and economic policy, in particular by taking part in job-creation, professional mobility, electronic trading, and, in so doing, generally mobilising the assets of their respective region or city;
ix. set up an appropriate framework for industrial dialogue and collective bargaining adapted to the new working methods introduced by the new ICT, taking special account of the following factors:
a. social relationships must be remodelled to avoid dangers of exclusion or fragmentation of the community as a result of the current developments; public authorities must monitor this carefully;
b. the traditionally vertical pattern of sectors and professional branches, determining social relations, but no longer corresponding to the new reality, must be reviewed and rectified;
c. the new jobs and duties created by the ICT, such as teleworking, working in virtual teams, etc, must be given a clear and stable status, and their effects on company and family life must be studied.
10. The Assembly recommends that the Committee of Ministers instruct the appropriate intergovernmental steering committee to examine in depth whether the advent of the new ICT and the measures called for should not lead to a reflection on working time.
II. Explanatory memorandum
by Mr BEAUFAYS
Table of content
I. Introduction 5
II. Relations between technology and employment 6
III. The nature of technical change and employment 7
IV. Technology and employment: the aggregate results 8
V. Where are jobs being created? 10
VI. Information technologies: miracle or myth? 12
VII. The shift in skills 13
VIIII. Technology, globalization and employment 14
IX. Conclusions 15
Appendix: Occupations with the largest job growth, 1990-2005 17
I. Introduction
1. Society is currently undergoing significant economic and social changes. New technologies are often blamed for many of the disturbing effects of these changes and in particular unemployment. This is in itself, as we shall argue, not a new phenomenon. The introduction of new technologies and in particular their massive diffusion has usually thoroughly changed the organization of production, the organization of work, the social relations and often the organization of political institutions. Their impact on employment is only one of their characteristics
2. However the technologies which have been at the basis of such changes and upheavals are not just any or all new technologies. It is those technologies which once set in motion have, over a longer period of time, pervaded and changed many other technological developments. Steam was such a technological development. It is certainly no coincidence that at the height of the diffusion of steam engines one can also see the crisis of the 1880s. The massive diffusion of electricity (in the industrialized world of the time) combined with the changes in modes of transport (the automobile) also concurred with the crisis of the 1930s. The main message of the school of thought called "structuralist" is that the economic crisis is the result of the fact that institutions at the time were ill adapted to cope with the changes taking place. Others however believe that innovation does not appear out of the blue, just to upset the existing structures. Innovation is a response to a situation where a given technology is saturated, like it is the case today with traditional automobile manufacturing. Whether the gap between new technologies and socio-economic institutions is the reason of the economic crisis or only its consequence, the end result however remains much the same.
3. What about today? Information and telecommunication technologies are the new dominant forces of change of many social, economic and cultural processes. Societies are adapting to them by trial and error, searching for new institutions which might better address the challenges. Although there might be many similarities with earlier periods of creation and destruction there are also many differences which make it unique. The main characteristic is that it is radically changing the way how people communicate over time and space. Last but not least knowledge is increasingly mobile Changing the way how people communicate by by-passing time and space. Last but not least knowledge is increasingly mobile and omnipresent.
4. The real problem is one of dealing with an economy founded on knowledge while at the same time taking into account the demands and unbalances created by globalization. That calls for better recognition of the role played by knowledge and technology in economic growth. Nations which efficiently manage their capital of knowledge are those which achieve the best performance.
5. The relation between technical change and employment has been a source of extended debate between economists for quite some time. As Freeman and Soete (1994) point out it was already a topic of controversy in the seventeenth century and, since then, has returned time and time again to the forefront of the economic debate whenever the problem of structural unemployment sets the political agenda. The Committee on Science and Technology has noted that this direct link between technology and employment has been pushed somewhat into the background in previous Assembly debates on all problemsrelating to unemployment in Europe. It has therefore decided to examine more thoroughly ways of synchronising technological development and job creation.
6. The studies by the OECD (1991,1994 and 1996), in particular that on "Technology, productivity and job creation", several white papers produced by the EC of which the one on Competitiveness, Growth and Employment" are only some of the examples of this renewed interest to understand the dynamic relation between technology and (un)employment. The Commission of the European Union's "Green Paper on Innovation", and the report by the group of experts on the "European Information Society" also offer interesting leads for tackling this subject. The fact that the European Union has set up an "Institute for Prospective Technological Studies" (IPTS) in Seville, with the main task of analysing the relationship between technology, employment and competitiveness is another sign of the growing importance of the subject.
7. This document is partly based on a study carried out by the IPTS at the request of the Committee on Science and Technology. I must thank the Institute for its valuable assistance. This document is also intended to convey interesting opinions offered on this subject both internationally and nationally. It also attempts to take into account the most recent theory on the matter and the experience of people on the ground.
II. Relations between technology and employment
8. Technology has played a decisive role in the long-term structural evolution of market economies. Technological innovations tend to concentrate in key sectors. One could nearly say that key sectors are created by innovation.The introduction of a new product has usually a slow and hesitant start with many new technologies which fail to make it to the market. As this phase is overcome it is followed by very rapid growth with imitating firms trying to exploit the opportunities created. This growth period is usually followed by a phase of declining profits due to market saturation which in turn might limit technical advances. Sometimes the whole growth cycle might take only few years. In other cases the cycle might take several decades. A good example is the development of the electricity networks and systems which started at the end of last century and took up to the 1930s to grow to its contemporary form. Today information and communication technologies are going through a similar path of development.
9. The macro-economic effect of those innovations are only felt much later and come from the diffusion, widespread adoption and most importantly from linking together many interrelated innovations. Periods of expansion and growth happen only when social and institutional organizations are adapted to the new technological systems. One could argue that in the 1980s and 1990s we are witnessing such a period and that the times will require significant institutional changes. The ways we educate and train people in a changing economic environment; The way we produce and transfer (technical and scientific) knowledge; The management routines and practices of firms and corporations; The institutional barriers and regulations affecting changing and dynamic markets; The working of financial institutions; The rules and regulations affecting trade and investment flows worldwide. etc. In other words there is a growing emphasis on the change in the social and institutional rules of the game to achieve growth and social welfare.
10. Despite the existence of a number of new technologies (such as biotechnologies, new materials, renewable energy sources and environmental technologies) which all have considerable potential, this report reserves pride of place for information and communication technologies which transcend the usual dividing line between manufacturing industries and services and, consequently, are both of more immediate interest and truly "universal".
III. The nature of technical change and employment
11. The impact of technology on employment is the result of different forces operating at the level of firms, sectors and the economy as a whole. One can identify two forms of technical change.
a. Process innovation which makes production more efficient and generates cost reduction. Improving methods and organisation and introducing new ones make firms more competitive. Assuming output remains the same and it is a labour saving devise, it will tend to lead to lower employment. If cost reductions are passed down to lower prices it might however indirectly increase employment. However, production almost never remains the same and the extra income generated may affect those benefiting from this technical change (employers first, then the workforce) leading indirectly to job increases.
b. Product innovation: When technical change generates new or improved products (or services) it will tend to generate higher output and thus higher demand for labour and other factors of production. Although at the level of the firm the results seem to be relatively easy to assess there are many factors which might influence this relation: the structure of the industry (competition), the structure of the labour market, the openness of the economy, the effect of changes in income on demand, etc. Product innovation may be divided into three categories:
- secondary product or consumption innovation which consists in improving or developing a service which meets demand;
- replacement innovation, whereby a product or service is replaced by another better adapted to demand;
- radical consumption innovation concerning the economic system as a whole. New demand is created or, rather, revealed by the appearance of a product. Promoting radical consumption innovation is likely to lead to large job increases.
12. However, promoting product innovation and not process-innovation productivity gains would be too simplistic. This is both because innovations in production processes are essential to ensuring competitiveness and because process innovations and radical product innovations are complementary in nature since the latter require investment that generates productivity gains.
13. In addition to the offsetting effects described above, there are other indirect effects which are much more difficult to assess. The introduction of a technology by one firm will affect its rivals in the same industry. It will often displace or substitute existing products and services in other sectors. Changing demand in one industry or service might change the demand in other industries.
14. Given this complexity, the OECD report Technology, productivity and job creation (1996) concludes that it is almost impossible to disentangle the strength of the different effects and therefore suggests a combination of approaches to be able to understand the dynamics of job creation and destruction. The report suggests one should focus more on performance at firm level. However before doing so let us look at some of the aggregate results of technical change on employment in industry and services in the recent past.
IV. Technology and employment: the aggregate results
15. Although it is difficult to model or foresee the effect of the different factors described above on the structure and volume of employment, it is possible to analyze the main past trends. In other words we can observe what has happened with productivity, wealth creation and employment.
16. The last century has seen a staggering growth of wealth which has occured toghether with a continuos growth in employment despite the huge rise in productivity (see Graph 1) From this general historic overview it would seem as if in the long run and within the economy as a whole the growth spearheaded by the increased efficiency has been able to create more jobs and higher incomes. However in shorter time-spans the process has been much more cyclical.
Figure 1
GDP, employment and productivity in the G7 countries, 1870-1992
(logarithmic scale)
Source: Estimates by the OECD Secretariat; taken from Maddison (1994)
17. The post-war period, up to the 1970s, saw a great upsurge in productivity and employment. It could be argued that during this particular period the socio-institutional structure which was adopted fitted very well the dominant techno-economic paradigms which had been developing in the late 1930s and 1940s.
18. By the early 1970s this pattern is broken and the rate of output growth and productivity decline significantly. Employment in the different countries or economic regions of the world however did not follow the same path due to a variety of reasons, among others the social cost. Employment in the US kept growing but at a significantly lower pace. Japan had a very stable growth of employment.
19. In most of the EU countries employment growth has been minimal and remained that way since the 1970s. The consequence is that given the changes in demography, unemployment has increased substantially. The second half of the 1980s saw a slight upwards turn on employment However new entrants to the labour market did no allow for any significant reduction in unemployment. The slight recovery in growth of 1994 has had no effect on unemployment either. ( EC, G7-1996 conference).
V. Where are jobs being created?
20. The structural transformation of all major economies is not only characterized by a weaker overall employment growth but also by a shift between manufacture and from manufacture to services.
21. In early 1990s the share of employment in services in most OECD countries varied between 50 and 75%, (OECD,1996). According to the EC report ÒEmployment in Europe 1994 jobs in services in the EU grew in the period between 1970 and 1991 by an annual 1.4 million. In the more recent period this shift has accelerated. Between 1985 and 1990 average growth in services was 2.5% compared with only 0.5% in other sectors. In Ireland and the UK, services were responsible for around 90% of net job creation. In Germany, the Netherlands and Portugal the figure was 80% and in Spain 70%. Services are now the major source of jobs in the Union. Generally speaking, at national level, services are more significant wherever per capita income or GDP is higher.
22. In services four sectors contribute to over 60% of total OECD employment. Of these community, social and personal services account for around 30% of the total; followed by wholesale and retail trade with 20%; finance, insurance, real estate and business services with 10% and transport and communications with 5%. (OECD, 1996).
23. Although in general one could argue, as the OECD does, that low technology, low skill and low wage jobs in manufacturing have been shed and high technology, high skill and high wage employment have expanded, the picture is much more complex than that. Sectors, or better still, clusters of firms which are drawn into a cost reduction strategy, such as car manufacturers or the chemical industry will be downsizing in all types of employment and skills. Equally we might see so called traditional industries which are highly innovative and which create / need highly skilled personnel. (parts of the agro-food industry in many developed countries, the mechanical engineering industry in Germany).
24. Using firm-level time-series data, collected since 1978, a publication of the US department of Commerce (Technology, Economic Growth and Employment: New Research from the Dept. of Commerce, winter 1994/95) argues that firms using advanced technologies pay higher wages, offer more secure jobs, and increase employment more rapidly than other plants. Technology is found to contribute to the creation of more good jobs. Advanced technology firms hire workers with more skills and pay them better wages (even when taking into account the skill level). Overall employment growth was observed in conjunction with the use of advanced technologies. It is also shown that regardless of the size of the plant there is a strong positive correlation between the number of advanced technologies used and employment growth. Dynamic high growth plants were found to be crucial for industry performance. They provide well-paid and relatively secure jobs; the fact that they are often both high tech and active in export markets may indicate that both trade and technology contribute to their success.
25. Where will new jobs develop? The US Bureau of Labor Statistics forecasts for new jobs for the years up to 2005 (see Appendix) show strong prospects home health workers, programmers, travel/tourism workers, childcare, guards, nurses, cooks, teachers, etc., and predictably weak prospects for simple repetitive tasks, such as tellers, telephone operators, typists, assemblers, etc. The need to train people to use machines and keep updating their skills will generate quite a few teacher/trainer jobs. The entertainment and information services sector will receive a boost through the IT revolution itself (especially the creative side of it, which is irreducible to repetitive tasks).
26. The environmental protection sector, undergoing rapid growth, is an example of how innovation and improved efficiency can create new jobs. This industry which produces equipment and technologies for reducing pollution and improving energy efficiency in production processes, already has an annual output of around 200 billion ecu and an annual growth rate of 5-8% in the OECD countries. It is estimated that one and a half million people are employed in these businesses and that employment in this sector is growing twice as fast as in the rest of the economy (European Union report on employment 1995).
27. To sum up the last two chapters on the relationship between technology, productivity and employment, we have reproduced in the following graph (Fig 3) a comparison of different levels of technology in relation to employment. It shows that within the industrial sector, the share held by high technology industries has grown sharply - along with increases in employment. On the other hand, in low technology industries productivity has grown more slowly than the average and job losses have been greater. From a sectoral point of view, in the OECD countries employment has shifted away from industry towards services. This is at least the general trend that has emerged over around 25 years.
Figure 2
Growth in productivity and employment in the G7 countries
high, medium and low technology industries, 1970-1993
Job growth in relation to the whole manufacturing sector
Source: OECD "Technology, productivity and job creation" 1996
VI. Information technologies: miracle or myth?
28. According to politicians, whose optimism would appear to be excessive, there is no doubt that the advent of the information super-highways will have positive effects on employment. Remarks made by Al Gore and the Delors and Bangemann reports are examples of this. The interim report by the European Union's Group of high level experts says that the information society offers countless new opportunities for growth and job creation and more decentralised forms of organisation, individual enrichment, a better diffusion of well-being and improved exploitation of resources, etc.
29. The report nevertheless issues a serious warning that all of these improvements decisively depend on the congruence of the technological, economic and social dimensions of the information society. The information society must therefore be assisted by a number of measures designed to make the organisation of businesses and labour more flexible without loosing sight of the existence of a strong solidarity ethic in Europe. Many more warnings could be made be we shall emphasise one which seems to us to be of particular importance: the information society must be reoriented according to a demand-pull logic and should not continue to evolve according to a technology-push logic. In other words, various products and services should not be "imposed" on consumers whose genuine aspirations are ignored.
30. In more concrete terms, the new information and communication technologies (IT) will have a considerable effect on service employment, which are a traditional "reservoir" of jobs in the industrialised countries. According to the European Union report these sectors, which now generate 60% of employment, have been traditionally "protected" from international competition and have also been sheltered from radical automation. As a result concerns about the impact of the "creative destruction" of IT technologies on employment in these services seem to be justified prima facie. The deregulation under way will lead to adjustments in certain cases but numerous jobs will be threatened by rationalisation. The following table reflects this trend which began in recent years and will continue.
31. On the other hand, the most immediate positive effects of IT technologies will be felt in infrastructures (networks, optical fibres, terminals, etc.). In the software personnel employment category, the growth has been large. In Japan from ~75000 in 1981, their numbers reached to over 350000 in 1990 and close to a million in 1994, and in the US from 304000 in 1980 to 835000 in 1991 and close to 2000000 in 1994 - similarly for western Europe; the estimate for the year 2005 for OECD countries goes up to 10 million.
32. As far as the effects on employment of other IT technology components are concerned, ie the generic services (access and transmission) and applications (content of transmitted information), in theory we can expect interesting prospects given the development of needs. The potential multiplying effects on the competitiveness of undertakings is also regarded as an asset.
33. Yet the reality is different, for the time being at least. The considerable increases in productivity expected when IT technologies were introduced have yet to materialise.Developments in the last decade, more than any other technological paradigm, have exposed the mismatch between these developments and social-intitutional structures which have been inherited from the past. This "productivity paradox" is only the visible expression of this mismatch. The mismatch will most likely be the main driver of change in technology as well as in social and institutional organization for the comming years. This state of affairs is at the heart of controversy between sociologists and economists and is a good illustration of the fundamental questions which we should ask about the relationship between science, technology and society. It also highlights the need for improving macro-economic indicators and the understanding of phenomena such as that of the productivity paradox.
VII. The shift in skills
34. The 1980s saw an upskilling in the labour force of all OECD countries measured inchanges in the educational level of workers. At the same time At the same time, the unskilled labour force has greatly shrunk while the number of highly skilled office workers has increased. In the services sector, in macro-economic terms employment growth has tended to benefit skilled "white collar" workers whereas unskilled "blue collar" workers have been victims of restructuring.
35. Another micro-level observation involves a reformulation of the skilled-unskilled dichotomy. For along time technological development has been viewed as threatening mostly unskilled labor, which is usually a term connoting low-education labor. This categorization is misleading though still most popular. The major source of skill-obsolescence in recent years is infotechnology, threatening mostly white collar, educated workers. The critical dichotomy however is not between skilled - unskilled but rather between repetitive and computer-reducible tasks, and creative, irreducible activities.
36. In this light, the work of many middle managers is in danger, because of its often repetitive character. The work of strategists is not (which is not a surprise); neither the work of gardeners. Craftsmanship is not computer-reducible. Computers are ideal for easily programmable logical steps, that do not require intricate motor skills or dexterity. Tasks that require high motor skills and/or imagination are much safer than repetitive white collar ones. As OECD 1996 argues as a result of information technologies, the possible codification of skills will concern first the more routine activities, some of which might involve relatively skilled labour, rather than relatively simple human tasks, which might never become codifiable. Recent developments in the restructuring of businesses and services seem to bear out this theory.
VIII. Technology, globalization and employment
37. An important reason for employment creation and employment displacement is often thought to be the globalization of the economy and the changes in international trade and competitiveness. Much of the present anxiety about unemployment in the developed countries is strongly related to this globalization process. Employment creation as a result of foreign trade has been substantial. In Japan more than three quarters of the total gains in employment over the period 1970-1985 can be attributed to foreign trade. In other words the employment growth pattern of Japan has heavily leaned on export led growth. EU member states have gained in employment in high wage goods trade with other OECD countries and have lost employment in low wage goods due to trade.
38. The process of globalization which in the 1970s and first part of the 1980s was still based on old generations of IT technologies, higher transport cost and still a relatively closed trade system could change substantially. IT technologies are enabling increased trading and facilitating the relocation of manufacturing and service firms. IT technologies enable increased tradability of a number of hitherto untradable services. Examples are the progressive shift of software houses, repetitive tasks of financial services, booking facilities of airlines, etc. to low-wage countries. Yet it has been precisely those service activities the ones which have until now provided most of the employment growth in developed countries. (see above)
39. Although improved communication means a high pressure to delocalise, there are also forces which opose this movement. The first one is the fact that many activities, particularly in the service sector, are bound to personal communications between producers and consumers. Secondly many consumer goods are sold together with a service, whereby the service activity might generate more employment than the product itself. Marketing people increasingly refer to consumer products as services with a gadget.
40. Another factor which counterbalances the delocalisation trend is the fact that firms, in manufacturing as well as in services, are usually part of a web of other firms embedded in a local economic and social environment, with distribution networks, transport facilities, financial institutions, knowledge producers (technical or otherwise), etc. The quality of this innovation system is a powerful force to affect the location behavior of firms. National and regional governments are progressively developing policies to support and strengthen these economic, social and infrastructural conditions.
41. Summarizing one could argue that although locational behavior of firms is strongly conditioned by trade, global competitiveness and the development of certain technologies, it is also affected by forces which are much more difficult to measure and which constitute the innovation system in which those firms are embedded. Strengthening the innovation environment of those webs is an important policy option not only to keep but also to generate new employment.
IX. Conclusions
42. The impact of new technologies on employment is a complex debate which is difficult to reduce to quantifiable data. Analyses conducted over decades suggest that this impact depends on several factors such as the intrinsic features of the technology in question, public reaction to that technology, the flexibility of markets, institutional adaptability, business organisation, education and training policies, etc. One thing is certain: the role played by technological development in the life of nations has now reached such a point that the new concept described as "knowledge-based economics and/or growth" has entered the terminology.
43. The advent of the information super-highways which defy the notions of "time" and "space" and reduce the "cost" of acquiring knowledge, more than ever places technological progress at the centre of macro economic analysis. Some see the information super-highways as a miracle solution to the problem of underemployment while others regarding them for the time being as an attempt to integrate several new information and communication technologies but not as a new product are more sceptical. As to the public, it observes these discussions more in anxiety than in hope. Yet on a purely qualitative front, the information super-highways carry the embryo of a highly attractive job market for many Europeans.
44. Doubts remain as to the ability of the private sector to define and implement the services required by the information super-highways singlehanded. If certain difficulties are overcome, such as a clear definition of objectives, adaptation of legislation and an up-grading of training, many sectors could benefit from the knock-on effects of the information super-highways. At present, it can be seen that neither the speed nor the extent of legislative and regulatory changes match the new situation created by IT technologies. Yet it is precisely in a period of rapid technological progress that the institutions must be able to adapt. We should insist on a more willful action of the policy maker, especially in order to maintain a fair treatment of, on one hand, rich and poor regions and on the other hand, big and small companies.
45. In the light of the foregoing a more general remark must be made: the challenge of the relationship between technology and employment goes far beyond a mere examination of labour markets and products. A more systematic approach is required with emphasis on the interdependence between different policies. The principle of adequate public support for the long-term development of the knowledge base, ie R+D, is given better focus from this viewpoint. The analysis set out in Chapter V clearly shows that the greater the R+D effort made by countries, the better their employment performance.
46. In order to guarantee the transition to a knowledge-based economy, investing in R+D alone will not suffice. The authorities have a duty to create the conditions enabling the market machinery to produce better results, which also means correcting the market machinery when it produces undesirable results. They also have the responsibility for co-ordinating the development of human resources and the introduction of new technologies. A list of measures is set out below which, although not exhaustive, contains the vital elements for a smooth integration of new technologies and, in particular, the smooth transition to an information society. The authorities should:
- improve access to knowledge and its diffusion, strengthen the links between industry, universities and research bodies;
- apply incentives to encourage organisation measures in businesses including their human resource strategy;
- assist the innovative and job-creation potential of small and medium-size businesses, in particular those whose technology has a high expansion potential;
- create machinery to improve the evaluation of the current or projected effects of new technologies; this exercise (technology watch) must be carried out very early in the process in order to avoid mismatches between technological and social developments;
- start a Europe-wide dialogue to compare experiences and draw up an inventory of "good practices" (of successful cases) of management and structural adaptation concerning the impact of new technologies;
- strengthen education and training in science and technology in schools in order to prepare the public better for the upheaval created by technological progress and facilitate their occupational adaptation in the future;
- take advantage of work relocation possibilities offered by new IT technologies in their job creation policies in isolated areas, nationally and Europe-wide;
- set up an appropriate framework for industrial dialogue and collective bargaining adapted to the new working methods introduced by the new IT technologies.
Appendix
Outlook 1990-2005: *
Occupational employment forecasts for the United States
_____________________________________________________________________________________
Occupations with the largest job growth, 1990-2005, moderate alternative projection
|
Occupation |
Employment |
Change |
|
1990 |
2005 |
Numerical |
Per cent | |
|
Salespersons, retail |
3,619 |
4,506 |
887 |
24.5 |
|
Registered nurses |
1,727 |
2,494 |
767 |
44,4 |
|
Cashiers |
2,633 |
3,318 |
685 |
26.0 |
|
General office clerks |
2,737 |
3,407 |
670 |
24.5 |
|
Truckdrivers, light and heavy |
2,362 |
2,979 |
617 |
26.1 |
|
General managers and top executives |
3,086 |
3,684 |
598 |
19.4 |
|
Janitors and cleaners, including maids and housekeeping cleaners |
3,007 |
3,562 |
555 |
18.5 |
|
Nursing aides, orderlies and attendants |
1,274 |
1,826 |
552 |
43.4 |
|
Food counter, fountain and related workers |
1,607 |
2,158 |
550 |
34.2 |
|
Waiters and waitresses |
1,747 |
2,196 |
449 |
25.7 |
|
Teachers, secondary school |
1,280 |
1,717 |
437 |
34.2 |
|
Receptionists and information clerks |
900 |
1,322 |
422 |
46.9 |
|
Systems analysts and computer scientists |
463 |
829 |
368 |
78.9 |
|
Food preparation workers |
1,156 |
1,521 |
365 |
31.6 |
|
Child care workers |
725 |
1,078 |
353 |
48.8 |
|
Gardeners and groundkeepers, except farm |
874 |
1,222 |
348 |
39.8 |
|
Accounts and auditors |
985 |
1,325 |
340 |
34.5 |
|
Computer programmers |
565 |
882 |
317 |
56.1 |
|
Teachers, elementary |
1,362 |
1,675 |
313 |
23.0 |
|
Guards |
883 |
1,181 |
298 |
33.7 |
|
Teacher aides and educational assistants |
808 |
1,086 |
278 |
34.4 |
|
Licensed practical nurses |
644 |
913 |
269 |
41.9 |
|
Clerical supervisors and managers |
1,218 |
1,481 |
263 |
21.6 |
|
Home health aides |
287 |
550 |
263 |
91.7 |
|
Cooks, restaurant |
615 |
872 |
257 |
41.8 |
|
Maintenance repairers, general utility |
1,128 |
1,379 |
251 |
22.2 |
|
Secretaries, except legal and medical |
3,064 |
3,312 |
248 |
8.1 |
|
Cooks, short order and fast food |
743 |
989 |
246 |
33.0 |
|
Stock clerks, sales floor |
1,242 |
1,451 |
209 |
16.8 |
|
Lawyers |
587 |
793 |
206 |
35.1 |
Source: US Bureau of Labour Statistics 1992
Reporting committee: Committee on Science and Technology.
Budgetary implications for the Assembly: none.
Reference to committee: Doc. 7437 and Reference No. 2049 of 10 January 1996.
Draft recommendation unanimously adopted by the committee on 17 December 1996.
Members of the committee: MM. Roseta (Chairman), Birraux, Mrs Terborg (Vice-Chairpersons), MM. About, Bartodziej, Bauer, Beaufays, Bogár, Caccia, Cherep, Cherribi, Chornovil, Cioni, Connolly, Cunliffe, Deguara, Frey, Galley, Golu, Mrs Hoffmann, MM. Janeček, Johansson, Külahli, Leers, Lekberg, Lenzer, Lorenzi, Maass, Melčak, Metelko, Mocioi, Musatov, Nestor, Mrs Nistad (Alternate: M. Lie), MM. Niza, Olrich, Onaindia, Pawlak, Petersen, Požéla, Priedkalns, Prokeš, Prusi, Rokos, Ryabov, Sanz, Mrs Schicker, MM. Szalay, Theis, Sir Donald Thompson, MM. Jack Thompson (Alternate: Lord Newall), Tiuri, Toshev, Turini, Vujić, Weyts, Yürür, Mrs Zisi.
N.B. The names of those members who took part in the vote are printed in italics.
Secretaries of the committee: Mr Perin, Mr Torcătoriu.
1 1 by the Committee on Science and Technology