Job loss? India has modest potential but China likely to see more automation, says McKinsey report
Automation to radically change workforce in 2030: Report
Research firm McKinsey says 400?million to 800?million individuals could be displaced by?automation
In a startling revelation, a report by a global research institutesaid between 400million and 800million individuals could be displaced byautomation and they would need to find new jobs by 2030 around the world.
Research firm McKinsey in its report highlights that the global economy needs toboost productivity and growth at a time "when ageing populations are acting as a drag on GDP growth."
"Of the total displaced, 75million to 375million may need to switch occupational categories and learn new skills, under our mid-point and earliest automation adoption scenarios," the report says.
On India, the report says itis a fast-growing developing country which has "relatively modest potential for automation over the next 15years."
"Most occupational categories are projected to grow in India, reflecting its potential for strong economic expansion," it says, however, the report cautiously adds that employing new entrants in the formal sector jobs will require "job creation on a much larger scale than in the past."
Automation will make this challenge more difficult in India with some fearing “jobless growth.”
However, it says India can create enough new jobs to offset automation and employ new entrants, if it undertakes the investments in "step-up scenario."
The report says China faces the largest number of workers needing to switch occupations—up to 100million if automation is adopted rapidly, or 12per cent of the 2030 workforce, adding, the figure is relatively small compared with the huge shift in China out of agriculture in thepast 25years.
China and Mexico have higher wages than India, and so are likely to see more automation, McKensey says.
China is still projected to have robust economic growth but will have a shrinking workforce like Germany, China’s problem could be a shortage of workers.
As far as the advanced economies are concerned, up to one-third of the 2030 workforce in the United States and Germany, and nearly half in Japan would have to learn new skills and find work in new occupation is much eager.
"Over time, labour markets will adjust to changes in demand for workers from technological disruptions, although at times with depressed real wages," the report observes.
The report says that with "sufficient economic growth, innovation and investment, there can be enough new job creation to offset the impact of automation."
"But a larger challenge will be ensuring that workers have the skills and support needed to transition to new jobs," it says, adding that countries that fail to manage this transition could see rising unemployment and depressed wages.