The impact of technological progress on the employment structure and how to deal with it

Mondo Technology Updated on 2024-02-06

Text |Chen Jianwei is a professor at the National Institute of Opening-up of the University of International Economics.

Promoting high-quality and full employment is an inevitable requirement for promoting high-quality economic development, and it is also the fundamental way to continuously meet the people's yearning for a better life. How to ensure that the economy achieves qualitative and effective improvement and reasonable quantitative growth in the stage of high-quality development, so as to promote the realization of high-quality and full employment, has become the direction that macroeconomic policies need to focus on at present and in the future.

Entering the stage of high-quality development, looking forward to the future industrial development needs and accelerating the formation of new quality productivity, it is necessary to pay more attention to the driving role of scientific and technological innovation, and the new quality productivity reflecting cutting-edge innovative technology will inevitably accelerate the adjustment of the labor market. Therefore, it is necessary to improve the human capital accumulation policy that is suitable for the digital economy era, comprehensively improve the skill level of workers, respond to changes in the employment structure, and promote high-quality and full employment.

The impact of technological progress on the structure of employment.

Although the labor market is affected by multiple factors such as technology, economic openness, and institutions, the changes brought about by technological progress affect all aspects of the economy, and we should attach great importance to the continuous impact of technological changes on the labor market. To understand the mechanism of the impact of technological progress, it is necessary to recognize the unevenness and bias of technological progress. Technological progress in the economy does not occur uniformly, and there are differences between different enterprises and different industries, so there will also be differences in the environment in which labor is employed and the productivity of matching labor tools. In addition, there is a certain complementarity between workers' skills and technology, that is, the application of a certain technology requires a specific type of skill or knowledge, which is closely related to the application of the technology, promotes and complements each other, and acts together in the production process or work task, and the result is to improve efficiency or output.

Under the influence of market mechanisms such as the bias of technological progress and the complementarity of skills, the demand and supply of labor in different occupations, industries or regions in the labor market have begun to become mismatched. This structural imbalance may lead to a relative oversupply of labor in some occupations, industries or regions, while a shortage of labor supply in others, which has an impact on the employment structure, and is mainly characterized by the following characteristics.

First, the skill mismatch has intensified. At present, there is a certain mismatch between supply and demand of skills in China's labor market. For example, some emerging industries include a shortage of specific skills needed to generate new productivity, and the scale and quantity of these skills are insufficient, and there is a large number of workers with certain traditional skills who cannot find suitable jobs. As technology continues to advance in favor of a highly skilled workforce, new technologies and ways of working are emerging, and there is a huge demand for a workforce with the right skills and knowledge. In addition, technological progress may accelerate the obsolescence of old technologies, causing some workers to no longer have skills that match market demand, exacerbating the skills mismatch.

Second, the industrial structure of employment has continued to adjust. From the demand side, the transfer of employed persons from the secondary industry to the tertiary industry is synchronized with the transfer of the aggregate demand of the national economy. From the perspective of the supply side, the imbalance of technological progress drives the relative change of products or services in different industries, and the relative decline of industries with rapid technological progress leads to a decline in the share of employment. As a result, technological change drives economic restructuring, and the demand for employment in certain industries or fields changes, resulting in an imbalance in the industrial structure in the labor market. For example, the productivity of the traditional manufacturing industry continues to increase after technological upgrading, but the relative demand for products and employment has decreased, while the employment demand of emerging industries has increased.

Third, there is an imbalance in the regional structure of employment. Technological progress will bring a certain capitalization effect, that is, the emergence of new technologies will lead to new investment and create new jobs, but this capitalization effect is unevenly distributed among regions. For example, in some areas, employment opportunities may be reduced due to industrial restructuring and lack of investment in new technologies; In some areas, employment opportunities have increased due to incremental investment and rapid development in emerging industries. As a result, technological progress may trigger new structural imbalances in the employment region.

Fourth, there is an imbalance in the occupational structure of employment. Occupation is the result of the division of labor, and the mode of division of labor is mainly influenced by technical factors. A large number of studies have shown that the extensive application of automation technology has led to a decrease in the number of employment opportunities in occupations that mainly focus on completing routine work tasks, mainly in the form of medium-skilled jobs. Employment opportunities for low- and high-skilled occupations have increased.

Fifth, the income gap has widened. Technological progress has driven the increase and decrease of labor demand in different industries, regions and occupational types, and the income of workers will also be differentiated. In general, wages depend on labor productivity and are affected by the supply and demand of labor. Industries with rapid technological progress will increase labor productivity rapidly, and workers' wages will maintain relatively rapid growth, and wages for high-skilled jobs in short supply of labor will rise even more. Technological progress has driven structural imbalances in employment, which have also led to widening income disparities among workers of different skill levels and occupational fields.

Recommendations for addressing the impact of technological progress on the structure of employment.

At present, China's digital economy is developing rapidly, and the depreciation of traditional production skills is very rapid, and the supply of skills to adapt to the digital economy era is insufficient. Therefore, it is necessary to better coordinate the strategy of giving priority to education and employment, continuously improve the quality of higher education, improve the modern vocational education system, make up for the shortcomings of basic education in underdeveloped areas and rural areas, and improve the system and mechanism of lifelong vocational skills training.

First, we should continue to improve the quality of higher education. The quality of higher education is the lifeblood of the supply of highly skilled talent. At present, the scale of higher education in China is huge, but the quality of education still needs to be improved. It is necessary to deepen the reform of the higher education system and mechanism, strengthen the education of STEM disciplines (science, technology, engineering and mathematics) and the construction of "four new" majors, increase the proportion of science and engineering talents, and continue to optimize the structure of disciplines and talents. We will continue to innovate the training model of higher education talents, especially increase the cultivation of innovation and entrepreneurship capabilities, cultivate compound talents who can adapt to the transformation of an entrepreneurial society, and improve the ability of higher education to serve the world's scientific and technological frontiers, the main economic battlefield and the major needs of the country.

The second is to improve the modern vocational education system that is compatible with the vocational change. The wide application of digitalization and artificial intelligence technology has promoted career change, and a large number of new types of occupations complementary to digital technology have emerged, while traditional vocational education still cannot meet the training needs of new vocational talents. Therefore, it is necessary to speed up the modernization process of vocational education, explore the establishment of an institutional mechanism for the interconnection of vocational education and general education personnel training, and smooth the flow mechanism of talents within the education system; Explore the training mechanism of high-level technicians in comprehensive universities, optimize the professional setting guided by industry and occupational needs, and enhance the adaptability of skilled personnel training to the needs of the labor market.

The third is to make up for the shortcomings of basic education in underdeveloped areas and rural areas. The responsibility for the supply of basic education in China is mainly at the local level, and with the advancement of population urbanization and the widening of the productivity gap between urban and rural areas, the resources to support the development of basic education in underdeveloped areas and rural areas are becoming more and more insufficient. To fundamentally solve the imbalance in the regional structure of employment and the imbalance in the skill structure, it is necessary to start by improving basic education and narrowing the gap in the quality of basic education between urban and rural areas and between regions. First, it is necessary to strengthen the overall responsibility of the provincial level and promote the equalization of basic education in the province; Second, it is necessary to increase the transfer of financial payments to education in underdeveloped areas and rural areas, and effectively improve the conditions for running schools and teachers in underdeveloped areas; Third, we should continue to narrow the digital divide between developed and underdeveloped regions, and use digital and artificial intelligence technologies to increase the supply of high-quality educational resources in underdeveloped and rural areas.

Fourth, improve the system and mechanism of lifelong vocational skills training. In the era of digital economy, the structure of labor market demand is changing rapidly, and strengthening vocational skills training is a fundamental measure to improve workers' employment and entrepreneurship ability, alleviate structural imbalances, and achieve high-quality and full employment. Therefore, it is necessary to strengthen the construction of lifelong vocational skills training system and mechanism, strengthen skills training related to the application of digitalization and artificial intelligence technology, and improve the ability of workers to transfer jobs and re-employment and adapt to the needs of the digital economy.

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