There was a lot of talk at the end of 2017 about how automation and artificial intelligence will continue to replace jobs. Have you recently self-checked luggage for a flight or scanned your own groceries? Those are small examples of the trend.

In October 2017 the CBI released its report Disrupting the Future which considered the impact of artificial intelligence, blockchain and the internet of things on the workforce.

The report recommended that the UK government set up a joint commission in 2018 to examine the impact of AI on people and jobs. The commission would comprise business, academics, employee representatives and a minister.

You can read some of our thoughts on blockchain and smart contracts here and liability within the internet of things here.

Advances in technology, and in particular in artificial intelligence, are driving a few key workforce trends:

  • people are able to work remotely and more flexibly;
  • alternative employment models can thrive (like they have in the gig economy);
  • people are working with machines and computer software in ways that improve their work; and
  • certain processes are being automated.

These changes are likely to give businesses opportunities to react more swiftly and more accurately to the demands of their customers and clients. But they also create challenges.

We’ve been speaking with a few clients about what steps they have been taking to prepare for the future workforce. We’re delighted to share the themes with you here:

  • When asked in an anonymous poll what was expected to be the biggest threat to business from an employment perspective, nearly 40% said the status of their people (i.e. are they employees, workers or independent contractors?). A close joint-second was the reward and retention of the workforce and liability for automated decision making.
  • Less than 10% of those who responded to our poll were concerned about trade unions. That’s an interesting statistic because in some jurisdictions – such as Germany – we have been advising on some very difficult union / works council issues that have arisen out of technological changes being introduced to the workplace.
  • With some exceptions, lots of businesses have no current plans to restructure the way in which they engage their workforce. Although they might be looking to revamp their compensation or benefit structures to retain their best talent, they are often looking to do this within the context of a traditional employment relationship. The feeling we get is that many employers are reactive rather than proactive in this area.
  • There is increased demand from the workforce – particularly millennials – for “permanent employability” rather than “permanent employment”. In other words, they are looking to their current employer for training and skills that they can use in future jobs.
  • The workforce is more internationally minded (if not internationally mobile) than it ever has been.
  • The retention of highly-skilled people is therefore critical. This means that thought is being given to the future structure of benefit arrangements.
  • Some clients have explored crowd-sourcing, but there is apprehension around ensuring that the quality of output is maintained – this is particularly the case where this might impact on brand.
  • There was some experience of contractors (or workers) in the gig economy wanting to organise themselves and negotiate terms on a collective basis with the employer. This is a marked difference from the way traditional freelancers operate. The practical challenge for employers is to figure out how they should engage with a group that purports to represent a workforce that may be constantly changing (as individuals act on particular ‘gigs’).

What will drive real change in this area? Technological advances will continue to be made and this will make the world smaller and the workforce more internationally mobile. This will put pressure on businesses. But policy makers may also become more interventionist – perhaps to ensure that there is sufficient financial provision being made for pensions or social care in the future. This may result in changes in the law that force businesses to confront issues that many are, for now, ignoring.

For more information, watch a short video here.