The Future of the Labour Market - REPORT

THE FUTURE OF THE LABOUR MARKET - "THE FUTURE OF WORK" REPORT

The future of the labour market is already upon us. Robots have become a permanent fixture in factories and offices, automation and artificial intelligence are transforming processes within companies, and the gig economy is revolutionising HR and recruitment. The growing need for flexibility and an ever-widening skills gap represent major changes that the labour market must confront. The question is whether we are ready for them.

The published report "The 7 Drivers Shaping The Future of Work" – prepared by Talent Alpha and its partners: Hays, KKS Savills, Transformant, Digital Readiness Institute and the Labour Mobility Initiative – describes the factors with the strongest influence on the future of work. Among them, the authors identify technological transformation, workplace culture, organisational processes, demand for new skills, innovative business models, changes to offices, and legal changes.

It is difficult to predict exactly what the world of work will look like over the coming decades. However, the future is increasingly rarely painted in dark colours, as a reality in which robots and artificial intelligence take jobs away from people. More and more is being said about the benefits and hopes than about the threats arising from technological development.

– We don't know what the future will bring, but technology certainly creates new opportunities for businesses and workers. As many as 85 per cent of the jobs that will exist in 2030 have not yet been invented. At the same time, we are already experiencing rapid changes in the labour market, the best example of which is the growth of the so-called gig economy, an flexible economy based on commissions – comments Przemek Berendt, co-founder and CEO of Talent Alpha.

NEW PROFESSIONS AND NEW JOB OPPORTUNITIES

New professions and new job opportunities

According to the World Economic Forum (WEF), by 2022 75 million jobs will disappear as a result of automation. Such forecasts raise concerns among many workers, particularly those performing repetitive and routine tasks characterised by a high degree of predictability and low dynamism. The changes taking place are already visible worldwide. In Shanghai, 40,000 m² (approximately 10 acres) of warehouse space at JD.com is managed by robots, accompanied by just five people. Ericsson is to open a fully automated factory next year, and Tesla's goal is to launch factories operating without human intervention as soon as possible.

However, the same forecasts predict the emergence of as many as 133 million new positions on the global labour market. This will result from new business opportunities arising from technological development and the growing availability of the latest solutions. Not only will automation specialists, programmers and engineers be needed to implement and maintain the operation of IT systems and robots, but also experts in fields that do not yet exist today. With each passing year, new areas of specialisation, classed as so-called professions of the future, will appear on the labour market. We can expect these to be professions related to data analysis, digital transformation, automation, artificial intelligence, and the online environment. At the same time, it is worth bearing in mind that just as 20 years ago nobody had heard of cryptocurrency market experts or UX designers, so today it is equally difficult to predict precisely which professions will be attractive over the coming decades.

Technological development is also changing the face of HR processes and broadening the range of ways in which work can be performed. Cloud-based platforms allow us to carry out tasks from anywhere in the world. A wide range of as-a-service solutions enables flexibility, freedom of choice and supports the development of the so-called gig economy, an economy in which workers consciously give up a single place of employment in favour of project work and independently selected commissions. Voice and facial recognition systems, the internet of things, and clothing and accessories containing advanced electronic technologies help to track employees' current needs and support recruitment and HR processes. All these trends pose new challenges, but they also build the future of work.

THE IMPORTANCE OF ORGANISATIONAL CULTURE

The importance of organisational culture

New dimensions of business and the opportunities associated with them are generating increased demand for technological competences. It is estimated that there is already a global shortage of nearly 10 million people with such skills. The growing gap in the market is giving rise to new management and recruitment strategies. New processes are emerging within companies, entirely different supplier networks are taking shape, and there is a need for intensive upskilling of employees. The organisational culture of companies is also changing.

– The skills gap is putting increasing pressure on employers and forcing them to look for specialists in other regions of the world and demographic groups. This means that the organisational culture of these companies in the future will have to focus above all on diversity and inclusion. Combined with the aspects taken into account by candidates when choosing their next place of employment, building organisational culture is emerging as one of the key pillars of an effective recruitment strategy – emphasises Sandra Henke, Group Head of People & Culture at Hays.

Hays experts identify six elements essential to building and maintaining a friendly organisational culture. These include a sense of purpose in the work performed, involving employees in discussion and joint decision-making, and promoting appropriate attitudes and behaviours among management. Also important is the company's drive for improvement, openness to change, and encouraging all employees to participate in the process of creating a good workplace.

The meaning of work and the purpose of the tasks carried out are today more important to employees than ever before. For employers, this means the need to define the company's mission and the values it wishes to follow, and then to apply them in all its activities. The next step is to involve employees in the decision-making process, listen to their opinions and strive to create the kind of workplace that those employed want.

– When taking action to build organisational culture, it is important to remember that the example must always come from the top. Managers must fully understand and identify with the organisation's culture, work and make decisions based on the company's values, and listen to employees' needs. Let us also remember that organisational culture cannot be treated as an item on a to-do list. It is not enough to create a document describing the behaviours desired among a company's employees. Building organisational culture is an ongoing process, continuously gathering feedback and seeking out areas that need improvement. Importantly, a good organisational culture should be created by the people it affects, that is, by all employees – notes Agnieszka Czarnecka, Head of HR Consultancy at Hays Poland.

Companies wishing to grow and build a competitive advantage will have to take care of employee satisfaction, as it is the foundation for building loyalty towards the employer. The success of every company depends to an increasing degree on the skills and knowledge of its employees. Employers are aware of this and are strengthening their efforts aimed at retaining valuable specialists within their organisational structures.

IS THE ERA OF THE PERMANENT JOB COMING TO AN END?

Is the era of the permanent job coming to an end?

Equally important for companies will be openness to new models of acquiring talent and forms of collaboration. According to Accenture, over the next five years on-demand work platforms – which enable companies to engage in collaboration for a short period or for a specific task – will become one of the main drivers of economic growth. SIA (Staffing Industry Analysts) analysts point out that the so-called Human Cloud, i.e. systems and platforms bringing together specialists in the cloud, are becoming increasingly popular in large organisations. Until now, they were used only by smaller companies.

What does this mean for employees? On the one hand, benefits in the form of greater flexibility and independence in choosing a company and the tasks performed. For many, an advantage of commission-based work may also be the ability to maintain a work-life balance by matching commissions and periods without employment to one's own needs. On the other hand, the risks arising from the growth of the gig economy are also highlighted. To find their feet in the new market realities, candidates will need valuable competences sought after by companies and the ability to adapt quickly. Another criticism of this form of collaboration is the lack of stability associated with permanent employment and the financial insecurity of workers.

Market experts predict, however, that a healthy balance will be maintained in the market. In the future, companies will seek to change the proportion of permanent employees to temporary associates, but key functions related to strategy planning and the implementation of procedures will invariably be performed by permanent employees. It is also worth remembering that people have different predispositions and expectations. Not every employee can give up a permanent job, because such a career path requires an entrepreneurial mindset, constantly seeking new commissions and high work efficiency. Observing the growing skills gap worldwide, it can be expected that employers will have to take this fact into account in their recruitment strategies.

Summary

The report "The 7 Drivers Shaping The Future of Work" prepared by Talent Alpha with its partners shows that the future of the labour market is not only about threats. Although automation may eliminate 75 million jobs, forecasts also speak of the creation of 133 million new positions. Organisational culture based on diversity will become key, and commission-based work within the gig economy will gain in importance.

Experts predict, however, that the permanent job will not disappear — it will remain the foundation for key functions in companies. There is already a shortage of nearly 10 million specialists with technological competences, which is forcing employers to adopt new strategies for recruiting and retaining talent.