Search Results

Worries that jobs will be lost to automation are not new but have been heightened since the release of Frey and Osborne's 2013 study [available in VOCEDplus at TD/TNC 123.687], which warned that nearly half of jobs in the US were at 'high risk' of automation. Nearly a decade on, this short briefing note looks at both the current and longer-term picture of the relationship between technology and jobs and pay.

The evidence suggests that automation doesn't just destroy jobs, it can also raise demand for other workers, and create the space for entirely new jobs. Consistent with this, there is evidence that exposure to automation has affected the cross-section of employment growth in the UK - both in the last decade but also in the longer-term. This is consistent with what is now a wide body of international evidence pointing to the importance of automation for wage determination. So automation is affecting jobs. But the fact that aggregate employment continues to grow alongside these effects suggests automation's job-destroying impact continues to be offset by positive indirect effects. The authors conclude that, overall, while we must remain vigilant to the impact of automation, especially since it affects some people and places more than others, the most pressing problems facing the UK economy are not too much automation, but low investment and low productivity growth. We should worry more about these and less about robots taking our jobs.

Edited excerpts from publication. Show less

This paper presents new evidence on international trade and worker outcomes. It examines a big world event that produced an unprecedentedly large shock to the UK exchange rate. In the 24 hours in June 2016 during which the UK electorate unexpectedly voted to leave the European Union, the value of sterling plummeted. It recorded the biggest depreciation that has occurred in any of the world's four major currencies since the collapse of Bretton Woods. Exploiting this variation, the paper studies the impact of trade on wages and worker training. Wages and training fell for workers employed in sectors where the intermediate import price rose by more as a consequence of the sterling depreciation. Calibrating the estimated wage elasticity with respect to intermediate import prices to theory uncovers evidence of a production complementarity between workers and intermediate imports. This provides new direct evidence that, in the modern world of global value chains, it is changes in the cost of intermediate imports that act as a driver of the impact of globalization on worker welfare. The episode studied and the findings add to widely expressed, growing concerns about poor productivity performance relating to skills and to patterns of real wage stagnation that are plaguing contemporary labour markets.

Published abstract. Show less

Prior research shows reduced criminality to be a beneficial consequence of education policies that raise the school leaving age. This paper studies how crime reductions occurred in a sequence of state-level dropout age reforms enacted between 1980 and 2010 in the United States. These reforms changed the shape of crime-age profiles, reflecting both a temporary incapacitation effect and a more sustained, longer run crime-reducing effect. In contrast to the previous research looking at earlier US education reforms, crime reduction does not arise solely as a result of education improvements, and so the observed longer run effect is interpreted as dynamic incapacitation. Additional evidence based on longitudinal data combined with an education reform from a different setting in Australia corroborates the finding of dynamic incapacitation underpinning education policy-induced crime reduction.

Published abstract. Show less

This paper presents the activity carried out inside a work package (WP7) of the ISEKI_Food 3 Academic Network project (2008-2011) dedicated to the facilitation and promotion of life long learning in higher education. In fact, recognition of prior learning is an essential tool to foster lifelong learning within the European Higher Education Area. Professionals could be more attracted to go back higher education if their competences [were] adequately recognised as credits in the programs they want to study and complete. Within the aims of the cited work package, recognition or accreditation of learning performed in a non academic environment ('prior learning') by means of the network partners was investigated. Owing to the presentation of the aim and objective of the topic, [the authors] present the results of a questionnaire set-up to be filled on-line by ISEKI_Food partners, in order to collect information around the consideration of [whether] prior experiences and/or learning activity, certificated when possible, are recognised by [a] university to obtain [European Credit Transfer and Accumulation System] ECTS in order to facilitate the student's curriculum. Maximum of credits to be recognised, disciplines more frequently subjected to this procedure of recognition, type of agreement between university and other institutions (secondary schools, training agencies, etc.), prior experience/learning, are all items covered by the survey. Many of the partners participating in the survey and/or attending the meetings where the prior experiential learning was explained showed interest in reporting their own experience, [where] results are changing from country to country.

Published abstract. Show less

Despite the contribution of both human capital and R&D to economic growth, the UK fiscal system does not treat the two equally when it comes to employer incentives to invest. Specifically, firms that invest in R&D are able to claim generous tax relief on their investments whereas there is no such across-the-board incentive to invest in the training of their workers. In this briefing note, we explain the economic rationale for government support in the form of tax credits (Section 2). We discuss current practice in the UK in relation to R&D (Section 3) and evidence on effectiveness (Section 4). We then discuss how the policy might be adapted to provide similar incentives for investing in human capital (Section 5).

Excerpts from publication. Show less

The ramping up of the national minimum wage since 2015 has more than halved the share of low-paid employees in Britain. But it is far from job done: too few low-paying jobs offer dignity, respect and security to the people doing them. This article reports on how the minimum wage has transformed pay - and how we can go beyond this to make real progress on providing 'good work'.

Edited excerpt from publication. Show less

This edition of Low Pay Britain is our twelfth annual report taking stock of the state of low pay. Recent editions have focused on the short-term impacts of the [Coronavirus Disease 2019] COVID-19 crisis on low paid workers. Those have largely receded, and so here we take a longer view, and look at how low paid work has changed over the past two decades during the existence of the minimum wage in the UK.

Recent increases in the minimum wage have successfully driven down the incidence of low hourly pay to equal the record low last seen in 1975. But we find there has been much less progress elsewhere for low earners. Low pay is widespread among the self-employed, who do not benefit from the minimum wage and whose numbers have increased over the past 20 years. And there are several forms of work insecurity - including the risk of job loss, volatility in hours and pay, and not being able to find enough hours - which continue to make life difficult for too many low-paid workers but would be considered totally unacceptable for higher paid workers to experience. Having tackled low hourly pay with an ambitious minimum wage, a policy agenda for low-paid workers in the 2020s should seek to address these problems with similarly ambitious action.

Excerpts from publication. Show less

This report is about the nature and speed of change in the UK's labour market, about how past periods of rapid change have happened, and about workers' experiences as they have lived through these changes. It is written with an eye to the upheaval we expect to see in the coming decade as the effects of Brexit, [Coronavirus Disease 2019] COVID-19, and the net zero transition work their way through the economy. It forms part of the Economy 2030 Inquiry, a joint research project between the Resolution Foundation and the Centre for Economic Performance at the London School of Economics.

This report is structured as follows: Section 2 sets out basic facts about how the sectoral and occupational composition of employment in the UK has changed over the past half century, and how the pace of change has varied over time; Section 3 expands on how this change has taken place, with a focus on the contribution of workers moving jobs and sectors; Section 4 looks at what these changes have meant for workers living through these changes, in terms of both the benefits (as some workers experience stronger pay growth by changing jobs and sector) and the costs (as others are subject to involuntary job separations and the negative consequences which flow from that); and Section 5 concludes.

Excerpts from publication. Show less

Human capital and skills are important for improving the UK's labour market and economic performance. This note assesses how the skills needed in the UK labour market have changed over past decades, and how well placed our system of training - and particularly on-the-job training - is to help us adapt to these changes. Some of the most fundamental changes in the nature of work has been an increase in the need for social and abstract skills in the workplace, while the employment shares of occupations that are intensive in routine and manual skills have fallen. At the same time, the amount of training done by workers is in decline, with the proportion of workers who have received work-related training falling from 29 per cent in 2002 to 24 per cent in 2020. These low rates of training among the least educated are troubling, given international evidence showing that there are higher returns to adult education for these individuals.

In a world of stagnant productivity growth and with an increasing need for wages to keep pace with prices, improving the UK's system of training and skills provision could have an enormously beneficial impact. Fortunately, there is a wealth of international evidence that can be drawn upon to design a system that would make post-school training provision work for more of the UK's labour force. Phase 2 of the Economy 2030 project will advance policy recommendations in this field that can ultimately contribute to higher and more inclusive economic growth for the UK.

Key findings include: (1) Wages have grown particularly strongly for jobs that require a significant amount of abstract reasoning: occupations that use abstract skills intensively (i.e. at the 90th percentile of abstract-skill-intensity across all occupations) have seen average wage growth of 30 per cent since 1994, compared with wage growth of below 15 per cent for occupations that involve below-median levels of abstract skills; (2) These shifts are relatively good news for workers with high levels of education and those in high-paying occupations, as they are most likely to utilise social and abstract skills while in the workplace; (3) The most-educated workers train more, with an average of over 40 per cent reporting having received some form of training in the previous quarter, twice as high a rate as those with below secondary level education; (4) Among adults who are out-of-work, training rates are very low: only 13 per cent received any training (in a 12-month period), less than half the rate at which employees are trained; and (5) The UK has seen falling rates of job mobility in recent decades, with much of the changing patterns of occupational structure driven by entry and exit of workers as opposed to employed workers transitioning from declining to expanding sectors.

Edited excerpts from publisher's website. Show less

Investing in human capital is a crucial aspect of building an economy that is both more productive and fairer, and any growth strategy must incorporate an agenda for increasing human capital and workforce skills within that. So how should we approach the task of developing a skills strategy that complements a broader economic strategy? In this report, we address this issue by focussing on a set of sectors - financial and business services, the creative and cultural sectors and life sciences industries - and technologies - clean technologies and artificial intelligence - that are of strategic importance for the UK. The strategic sectors are good places to work for everyone. It is striking - and very welcome - that wages are higher, and wage-experience trajectories steeper, for workers at every level of educational qualification in these strategic sectors than in the rest of the economy.

Supporting the expansion of these strategic sectors to boost growth and spread good jobs means ensuring that current and future workers across the country possess the right mix of skills to effectively perform the required tasks. Overall, our analysis points to the growing importance of both general and specific skills that are typically acquired with more formal education. It is thus unsurprising to see that workers employed in the strategic sectors are much more educated than average, with the proportion of workers holding a university degree almost twice as high as the rest of the economy and growing over the last years. However, there are worrying signals that the current skill mix of workers in the sector may not be adequate. The clearest indicator that demand exceeds supply for skills is the high wage premium associated with higher levels of education. This is clear throughout the educational distribution, and reflects the ongoing need for educational upgrading, such that more people leave the education system with higher education and skills. Without a sustained upgrading of the education and skills of workers, the economy will be unable to grow, especially in strategic sectors.

Summary from publisher's website. Show less