The future of work, jobs and skills: Employment growth is slowing down
“Employment growth is slowing down,” the Director-General of the International Labour Organisation (ILO), Gilbert Fossoun Houngbo, said at the just ended Davos 2023.
"At the global level, employment growth is slowing down," Mr Fossoun Houngbo said that during the launching of the ILO latest report – World Employment and Social Outlook: Trends 2023 at the just ended World Economic Forum in Davos.
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He said the ILO projected a one per cent employment growth in 2023 and expected productivity to go down.
"Multiple crises, including the war in Ukraine leading to inflation, are putting pressure on real wages, particularly for low-skilled workers who are at risk of losing their purchasing power," the ILO Director-General added.
The ILO is also concerned about the "quality of jobs", and there's a geographic split in how things are playing out.
In the Global North, there is a recovery in terms of the number of hours worked – or jobs compared to pre-COVID. But the new jobs being created in the Global South are in the informal sector, which has a lack of social protection.
Dealing with these emerging trends and others in the world of work this year was the subject of key sessions during Davos 2023.
Here are some of the main takeaways:
Invest in people – as an asset, not a cost
The challenges of our world will be solved by people, the Chief Executive Officer of Adecco Group, Denis Machuel, said and added that "investing in people ... at all levels of the organisation right up to the front line is critical".
"When people are secure, they demonstrate more resilience ... you get more engaged people, and more engaged means more productive,” the CEO of Adecco Group stated further.
For his part, the CEO and President of Paypal Dan Schulman, said the single-biggest competitive advantage that any company had was the strength of their workforce.
“Are they passionate about what they’re doing, are they dedicated to the company and do they have a semblance of physical health, mental health, as well as financial health?
“As CEOs, we need to at least measure the financial health of our employees because if they’re financially stressed, then we’re sub-optimising how successful we can be as companies ... We have the moral obligation to take care of our own employees,” Schulman stated.
The clean energy transition opportunity
Demand for green skills is outstripping supply, said Allen Blue, Co-Founder and Vice-President of Product Management at LinkedIn.
The social media platform has seen a 90 per cent increase in job postings for the renewables sector, but only a 70 per cent increase in the number of people who have those skills.
"As we break ground on things we need to do to mitigate climate change, how do we meet that demand?"
He sees the clean energy transition, fuelled by the US Inflation Reduction Act and the European Green Deal, as an opportunity for jobs growth and reskilling.
"There is a parallel to be drawn between the demand we are seeing for green skills and what we saw in the technology boom." - Blue stated.
For the jobs market, it means higher wages because big companies will pay more to get the talent they need. Companies working in tech are willing to hire based on skills alone, and skip questions about degrees – because they need the people, they’re willing to look beyond the normal things they’d pay attention to.
However, green skills are concentrated in the Global North, so Blue says there is a need for infrastructure investments in the Global South that include training and skilling.
Employers as educators and talent creators
To attract and retain talent, companies now have a responsibility to educate and upskill workers, the CEO of Accenture, Julie Sweet, said.
This also means looking beyond traditional degrees and offering apprenticeships, but technology is key to enabling companies to be their own talent creators.
"We are living in one of the best moments in history to actually be able to create systems that allow the lower skilled to have good jobs and to allow countries to be able to flip when they need to."
"The disruption we have gone through and the technology advancements we have gone through mean that to thrive in the next decade, companies and countries have to be able to access talent, be talent creators and unlock that talent. That often means being a more diverse place.
"You have to be able to create talent, there are not enough skills in the world that we need," she said.
“Accenture in US has 2,000 apprentices in professional services, up from five in 2025,” Sweet said and added: "The key to being able to reskill at scale starts with technology." .
The US invested $380 million in apprenticeships in 2022, said the US Secretary of Labour, Martin J. Walsh.
Connectivity is crucial to education and reskilling
To enable equitable access to jobs and skills throughout the world, there has to be equitable access to technology.
“If we want to democratise education, we have to put an emphasis on making sure that anybody who can and wants to, can connect to some sort website," said the Founder and CEO of Code.org, Hadi Partovi.
AI can have a role to play
"AI can create a more equitable society if used right ... Reskilling is the most important part of this," said the Co-Founder and CEO of Automation Anywhere, Mihir Shukla.
Just ahead of Davos, the Forum launched its whitepaper, Jobs of Tomorrow: Social and Green Jobs for Building Inclusive and Sustainable Economies.
It finds that in 10 countries, social jobs represent 11 per cent of the total workforce. But to meet inclusion and social mobility goals, these countries will need 64 million more social jobs – an increase of 37 per cent.
The green workforce is much smaller, however, representing just one per cent of total employment in those 10 countries. But to meet environmental goals, an additional 12 million, or 66 per cent more, green jobs are need.
During Davos, the World Economic Forum announced that more than 350 million people are being reached with better skills, jobs and education through commitments made as part of its Reskilling Revolution initiative, three years after launching.
Working with more than 20 governments, 60 global CEOs and a network of over 350 organisations, the reskilling revolution is preparing one billion people for tomorrow's economy and society by 2030.