Christian vandt stor konkurrence

Vinderen blev Christian Lambertsen, der læser erhvervsjura ved Aarhus Universitet. Hans essay tog afsæt i, hvordan automatisering kan skabe dilemmaer for virksomheder – og du kan læse teksten her.

What will become of the worker?

In 2004, Blockbuster had around 84.000 employees and made 6 billion dollars in revenue. In 2016, Netflix made 9 billion dollars in revenue with only 4.500 employees. These companies provide the same services, yet one of them has through technological developments been able to drive the other out of business, while employing only a fraction of the competitor. Truck-drivers replaced by self-driving trucks, call-center workers replaced by artificial intelligence, self-checkouts instead of cashiers, the list goes on and on.

Automation is or will soon be in every industry. With technology becoming increasingly advanced, paving the way for automation of more complex, and previously thought safe industries, it is only natural that we ask ourselves – what can the businesses and governments of today do to mitigate the coming displacement of the workforce – in essence, what will become of the worker? A bilateral approach focused on reskilling the workforce might be the solution.

Although automation destroys jobs, it also creates new ones. Imagine that for every job destroyed there exists a new, different job elsewhere. Market forces will automatically dictate the creation and destruction of these jobs. However, the retraining and reskilling of the workforce, preparing it for these new jobs, will not happen without intervention. The foremost challenge facing businesses and governments will therefore be how to effectively retrain and reeducate workers. 

In Denmark, unemployed workers receive public benefits but have to go through a very bureaucratic process of reentering the workforce at the job-center. The process has been overwhelmed with criticism and its results are debatable, with some staying in the system indefinitely. Should the reskilling responsibility remain entirely on the government, it would, in the current setup, only place a financial strain on society. Unemployment benefits are financed through taxes – taxes that will be felt directly by the private sector. Therefore, I advocate that the challenge must be solved bilaterally by both the government and the private sector. It is simply too ineffective, and therefore too costly a problem for private entrepreneurship, to leave in the hands of the government alone.

So what can businesses concretely do to face this challenge? I propose a two-pronged approach.

Firstly, a lot of larger companies have great internal courses and have access to a massive library of knowledge through their employees. The combined knowledge of these businesses and their industrial know-how must be made available to the unemployed. Imagine a centralized place of learning, like a university, but instead of professors lecturing, it will be taught by the companies in a much more practical and business-oriented way. The worker will be trained for a particular field of business or a particular job. This centralized place will be facilitated by the government, where a designated number of courses within certain fields will be set up. A company can then request to teach a course, granted they meet certain broad and not-too-specific learning goals. This way full autonomy will be given to the company with regard to the content of the course and the way it is taught. I believe that private enterprise can ignite the much-needed spark of motivation in unemployed workers far better than public-funded education is able to. The benefit of a centralized place of learning is that the worker can have multiple courses a day from different businesses, increasing the likelihood of the worker discovering newfound interests.

The second part of the approach is that the participating companies must have several “special positions” open at their company. These special positions will be reserved for motivated and interested workers who want to contribute and whom the company can see adding future value to their business. Although one could hope that sheer benevolence would attract companies to this program, they would need to be incentivized. One such way could be a tax-deduction scheme, whereby participating companies would get a tax-deduction based on both the number of participants in the course and the number of ultimately filled special positions.

Retraining and reskilling is not an easy task. However, as the old saying dictates – nothing worthwhile ever is. If companies can proactively work together with the government to face the coming challenge, perhaps by solutions like the one above, companies help themselves by not indirectly paying the costs of increasing unemployment – an unemployment that is ultimately driven by the very automation that is benefitting them in the first place.