The future of jobs (part 3)/The Times They Are a-Changin'
Continuing from the previous posts, I would like to discuss more about the role of firms and governments in labor market in The Fourth Industrial Revolution, or more specifically, how government steers the market, what kind of policies firms can contribute to and support. It is also noted that the labor force itself plays an equally important part in whether or not we can catch up to the blowing wind of The Fourth Industrial Revolution. This is the last part of my serial posts about labor market in The Fourth Industrial Revolution. Unlike previous ones, this slightly leans toward personal ideas and discussion, and all opinions are subjective. The scope of this post is about Vietnam, but some of its ideas can be applicable to global scale.
1. The role of government
Overall, the role of government in labor market is a very broad concept. It is the combination and completeness of institutions, policies, social norms, laws, regulations, and processes that can affect the demand and supply of labor in an economy. A general conception is that The Fourth Industrial Revolution will create labor shortage in high skill, technology intensive industries due to the lack of necessary skills, trainings and education of workforce. As no sane government want demand shrinkage, it leaves us with the solution of increasing labor supply for those industries. More specifically, it is government role to set up a high skill, prepared workforce for The Fourth Industrial Revolution. To do so, there are several approaches that can be feasible.
a. Strengthen the apprenticeship model
The primary role of education system is to ready young people for the workforce, especially higher education. Considering how fast technology changes and evolves under The Fourth Industrial Revolution, it is impossible for the current education system to catch up and fit industry demands into the curriculum. The apprenticeship model attempts to solve this problem by incorporating firms and businesses in final stage of education, with the purpose of equip young people with real working experiments. However, our current system allots all responsibilities to industries’ side. Thus, firms allocate resources and take risk of training, educating students without a commitment of future employment, which in turn, providing them little incentive of joining and committing to the model. This is where government should step in. Firms should be supported for contributing to the apprenticeship, financially by government funding or tax benefit. The length of the apprenticeship also needs to lengthened, up to one or even one and a half year, as more and more skills are required with technology advancement.
b. Subsidies and information network for reskilling
A very simple solution to increase high skill labor supply is to reskill and retrain the existing workforce. However, if we leave it to the workforce, it will be naught as the reskilling process require significant time and finance investment. Moreover, new jobs and positions which may not even be exist before are becoming more and more popular. This demands government intervention to steering the workforce’s retraining process by providing information, guidelines, and subsidies.
c. Setting national qualification framework
The Fourth Industrial Revolution brought great changes to labor market. A higher number of reskilling workforce, together with the readiness of information and knowledge online requires a mean to gauge and evaluate their skills gaining through nontraditional methods. National qualification framework grades workforce abilities by comprehensive tasks and assessments designed in specific fields, regardless of individual’s experience or acquiring methods. It is built upon input from the business community to ensure they reflect industry needs, and frequently revised to cope with rapidly changing business landscape. Examples for the national qualification framework are European Qualifications Framework or India’s National Skills Qualifications Framework.
2. The role of firm
In a sense, firms and businesses should play supporting roles in policies initiated by government. That means actively contribute and participate in various initiatives such as apprenticeship model, provide and help building information network, design national qualification tests. The actual input value from firm in specific industries is invaluable, as it bridges the gap from theoretical framework to practical applications and solutions. However, even with government supports and subsidies, contributing to those programs still requires significant commitment from business community, due to no immediate profit and value but rather than social responsibility. It also possess uncertainty factor, as the effects and results can only be seen and evaluated in medium term. All of the above mentioned factors are the costs and risks in which firms and businesses should shoulder with government in order to effectively direct local labor market to its correct path.
However, it doesn’t mean that business community cannot take a more active approach. A special mention should be community investment, traditionally belongs to an organization’s corporate social responsibility division or an associated foundation. This is the extend of the business community’s external financial investment, funding and targeting projects, ideas and technologies developed by independent groups. As The Fourth Industrial Revolution is characterized by its heavy usage of technologies and fast pace of changing, it will link with the emergence of innovative ideas and solutions. Investing into innovation will never be a bad option. Community investment will enable an organization’s ability to leverage their financial resources or expertise, apply its in-house knowledge, tools and resources to foster local economies and labor market. It is a win – win scenario for both business sides and community sides.
On short term, firms will have pressure of acquiring human resources to fill in new jobs and positions created by The Fourth Industrial Revolution. This will leave firms with distinct three options: hiring new talents, training and reskill current employees, or totally outsourcing those tasks to outsides businesses. As the market will certainly face labor shortage in high skill level jobs, actively finding and hiring the most suitable candidates is a very costly and difficult solution, and it is more true for small and middle size firms. Totally outsourcing is very tempting option, which will help businesses to significantly reduce both time and cost. However, training and reskill current employees also is a good direction for many businesses, as it allows firms to have a good in-house team to adapt and tailor its tools and projects for the increasing demands of The Fourth Industrial Revolution. In order to achieve that, a strong internal training process is a prerequisite.
Finally, a special note should be about the role of recruitment firms. In Vietnam market, majority of recruitment firms play a traditional function of middleman, which matches business demands with applicants’ resume, experience and skill. A new labor market expects a more dynamic solution for recruitment firms. It means that they should not limit themselves to a middleman role, but expand their part to be a career consulting and advising services. Some of the active approaches are such as providing updated and correct market information, advising and guiding participant toward new emerging roles, participating and organizing the reskilling process, even building short term programs to help current workforce acquiring new skill sets and knowledge. Of course, government also needs to be involved in this process to provide financial supports and incentives for recruitment firms.
3. The role of workforce
It is undeniable that big responsibilities of guiding and steering labor market are falls into government and business community, however, it is also untrue to deny or minimize the position of the current workforce. While many present jobs and titles are facing danger of cutting down due to technologies, AI, and automatons, The Fourth Industrial Revolution are creating an attractive and equal play field for labor market’s participants. As a large majority of workforce has little to no knowledge or experience in new opening positions generated by technology advancement, everyone will be in the same starting line. This is good timing for current workforce to reevaluate their knowledge, skill and reconsider career pathway. With the availability and reliability of free online resources, one can expect to acquire new skill set with minimal cost. The hard part is how to correct design career path based on one’s abilities.
This is why government and recruitment firms are vital keys of balancing and adjusting new labor market. The most suitable advice to be given to current workforce is that they need to recognize a big chance brought forth by The Fourth Industrial Revolution, correctly outline future career under government and business community consultant and advise, and revise a training program according to those guidelines under both time and financial constraints.
Since the definition and term for The Fourth Industrial Revolution was recognized by the World Economic Forum, Vietnam government has steadily acknowledged the important of this new industrial revolution. The current actions and initiatives to prepare for The Fourth Industrial Revolution are prepared by Ministry of Science and Technology, and heavily focused on development and adaptation of innovation into business and administration.
However, my personal interpretation for The Fourth Industrial Revolution is that labor market preparedness and restructure are equally vital. That is why I chose to do those series of post about labor market, as well as bring up discussion and suggestion on policies and actions. This is my own personal subjective opinions, and very open to interpret and debate.
A final note about this series is that The Fourth Industrial Revolution are happening and will continue evolving and affecting our society. There are risks, but also opportunities, and the cooperation of government, firms and workforce are necessary to maximize those benefits under this fast moving period.