Future of Work

The world of work is undergoing a major process of change

Delivering a special address at a ‘National Tripartite Dialogue on Future of Work: Challenges and Opportunities’ organized by FICCI in partnership with the International Labour Organization, the ILO's Director-General Guy Ryder said that as the world of work was undergoing a major process of change.

Audio | 11 July 2016
He added that it's important to remember that “As we design and shape the future of work, we are designing the future of humanity... we are building social justice upon which peace depends. And that's worth, I think, the efforts of every single one of us.”



Ladies and gentlemen,

let me start by providing a little bit of context for the dialogue, which we are today engaged upon. As has been mentioned, the ILO is three years away from its centenary. 
We are the oldest of the international organizations, founded, nearly 100 years ago, by a relatively small group of members, just over 40, of which India was one. An organization for which nearly a century has been dedicated to the promotion of social justice as the surest means of preserving peace in the world, and with this particular specificity, that, being a tripartite organization, bringing together not just governments, but also employers and workers.

As we approach our centenary, it seemed to me important, and I think the membership of our organization agrees with this, that our organization embark on a truly important and serious reflection on the future of work. And let me take advantage of you being in your majority an Indian audience here. We have to do this in a different way than we normally approach the work that we have before us every day. Let me put it in cricketing terms: this is not a twenty-twenty bash, this is a five-day test match. And it needs to be approached with the seriousness that successful test teams win test matches.

Why do I say this? Because we are, I’m afraid that it’s in the nature of the world that we live in, constrained by all-embracing short-termism. We want the result before we go to bed at night. Just like a twenty-twenty cricket match. And yet what we see in the world of work, are processes of change, processes I would say of transformation of the world of work, that are not operating overnight. They are not even operating in the period of anybody’s political mandate. They are operating over a much larger time scale. And so the invitation that has been launched in this ‘Future of Work’ initiative is for all of us; governments, employers, workers, to look beyond the habitual horizons and try to see what it is that is happening in the world of work, to anticipate those processes and - above all - to construct the types of policy responses that will equip all of us, including the ILO, to proceed with this mandate and objective of social justice in radically altered circumstances.

So my first proposition to you is that the world of work is undergoing a process or processes of change of unprecedented rapidity, on an unprecedented scale, because this is global change, and of a depth that we have not seen throughout the history of the International Labour Organization. And that this process or processes of change are accompanied by very high levels of uncertainty, in some cases fear in the face of change. And I think that we have to address both those changes and people’s human reactions to those changes, because that’s what determines their behaviour. Now this is not simply an intellectual or an academic exercise. The idea is to apprehend what is going on in the world of work with a view to drawing conclusions about our future action. It is an eminently practical process.

We have in the ILO decided to do it in three parts. This year we are stimulating national dialogues on the ‘Future of Work’, such as this one here, in India. I am very pleased that this type of dialogue is now taking place in more than 130 of the ILO’s member States. That’s a pretty good take up. It shows that we are homing in on something which matters to people and speaks to their national priorities. And I want to say just how important
I find it that India has picked up this agenda with enthusiasm and with determination.

Let me say there are very good reasons why India is central to this overall global endeavour. I could sum it up by saying that the ‘Future of Work’ very much depends upon the future of the world of work in India. Why? Because you are notoriously the world’s fastest growing major economy, you have the world’s largest youth population, you are the world’s largest democracy. And every time I come back to this country, because it is a cliché, I’m reminded of what that means in reality and how important it is.

But there’s one more piece to this jigsaw about why India is important, and that is because more and more, and I speak from a perspective of some advantage, I see India as more and more of a protagonist in the international policy-making arena. I see it in the G20,
I see it in India’s presidency of the BRICS group. And I see it when I come here. Now, again it’s very subjective, but it’s real. When you come to India you have a very clear, more than an impression, it’s more than an impression, a very clear understanding that India is a country which is determined to take its own future into its own hands, which is not making the mistake of thinking that its future is set out for it, but is set upon the task of making its own future, of shaping its own future. And that is a determination that should underlie everything we are doing, when we are trying to think about the future of work.

The future of work is not decided. It is not, as Shakespeare said, “written in the stars”.
It is for us to create. And there is a buzz in India, which makes me believe that that message and reality is understood, and not only understood but is being acted upon. And I congratulate you on that. It makes you fundamentally important participants in this overall future of work endeavour.

We have decided to try to structure this dialogue around four conversations. One, and I take advantage of what Madame Pillai just said. One is about the place of work in our societies. We will be making a mistake. It’s an error of economic reductionism – to use the jargon - to believe that the significance of work is limited to its capacity for material provision, to enable us to live, to eat, to have shelter. Of course it is that, but in work, certainly in Decent Work, there is this notion of self-realization, of doing something which is bigger than the individual, of being part of the society. Think of your own lives. Where do you connect with society? Freud said that work is the individual’s connection to reality. We become socialized through our family, through our education, for many of us, through our faith: our temple, our church, our mosque. But for the vast majority of people, for the vast majority of their adult life, it is their working experience which provides and defines their place in society. It sounds like a ‘soft’ issue, but if we ignore it we are missing a very large part of the story.

So that’s the first conversation. And by the way, in that regard, I was very interested to see the output from the conversation that took place in India on the 10th of May and we did something which is very obvious but too frequently not done. We actually asked young people what their aspirations are. What do they expect of the world of work? Some of the answers will not surprise you. Access to education and skills formation, obviously. But also a real concern with social disparities, gender disparities, a yearning for freedom and choice in their working lives and also great enthusiasm – and this picks up on what Mr Modi said in his opening remarks -- great enthusiasm to be entrepreneur, to have to opportunity to be a creator not just a taker of a job.

The second conversation is about where the jobs are coming from. The most frequently asked question about the future of work is: Where will the jobs come from? Ten million jobs for young people coming on the labour market in India every year. Expand that to the global scale, it is 40 million. We have to find 40 million jobs every year; where are those jobs coming from? And what will they look like?

The third conversation is around the organization of production. There is a lot of literature out there which talks not only about the creation and increasing importance of global supply chains, the fragmentation of production between enterprises, across borders, but also about the organization of production in manners which we haven’t really thought of
in the past. That is to say there is a school of thought that says that new technologies will allow work and production to be organized virtually through the internet; by the casual encounter of somebody who is in a position to provide a good and a service and somebody who would demand it. Not an employer and an employee, not an enterprise and a customer, but two individuals whose relationship lasts only as long as the transaction, from the labour to the commercial forms of exchange. And that has, I think, massive consequences for the future of the enterprise.

And finally, the fourth conversation is about what we do about all of this? How do we govern the world of work? At a time when I know that the issues of labour reform are on the table in this country, I think we do have to work out what the most appropriate ways of regulating and governing this future world of work will look like. And there are, you won’t be surprised to hear, very contrasting opinions about that at the moment.

So that’s the agenda. That’s what we are trying to do. Let me just give you some rather brief thoughts about what we have come up with so far.

The first thing is trying to crystalize around what some of the most important - I would call them mega-drivers of change - are in the global economy, and I have got four –or maybe three and a half- to offer you.

The most obvious one and a mega-driver of change which dominates the conversation, I think to an extent which is harmful to the overall comprehensiveness of the conversation, the first mega-driver of change is technology. Now, I could bore you for a very long time about the effects of new technology, so I will bore you only for a short period of time on the effects of new technology. It is said with great frequency that we are on cusp of the fourth industrial revolution and there are very differing points of view about what the effects of that revolution are to be. You can pick up a book, whose author would tell you that this is going to be massively destructive of jobs, and others who say the opposite, who say: if you look at history, if you look at the history of the past three industrial revolutions, whatever turbulence they brought they ended up creating more jobs than they destroyed. It takes some time but you get there. And so the question which is before us, and to which I can offer no definitive answer, and I don’t believe anybody else can as well, is: is it different this time? Is this Schumpeterian calculation of creation and destruction going to be negative rather than positive? That’s one question.

But there are two other, I think, more profound questions. We have to understand, for reasons I have already alluded to, that this industrial revolution has within it the capacity for us to organize work in ways that we have never been able to organize work before. I have talked about virtual platforms, I’ve talked about the sharing economy, the ‘gig’ economy. You call it what you will. And the other underlying point, I think, is the manner in which this technological revolution will dispense its opportunities and its negatives, geographically. I think it’s an illusion to believe that these will be spread evenly across the global economy. So, a lot of questions around technology.

The second mega-drive of change is demography, and I should more properly say, differential demographies. I’ve already alluded to the fact that India enjoys the largest youth population in the world and, of course, this is generally followed up by comments about the demographic dividend and the results from having that fortunate circumstance. But there are challenges as well as advantages. If you are not able to cash in a demographic dividend, if you are not able to find 10 million jobs a year, your demographic dividend can become a demographic time bomb. There is no more destabilizing factor that I know of in society than large-scale youth unemployment. That is a global reality and a global challenge to us all.

But, of course, demographies are different. I come from a region which is getting older and where the challenge of demography, well youth unemployment is still an issue, but it is increasingly what we do with an aging population, how we sustain welfare systems, pension systems. And have we got answers to those challenges? I don’t think we have as yet. So, different situations in different countries, but what joins us together is the issue of mobility and migration. Because if you have these differential demographies, you are, almost as a natural phenomenon, going to be facing very strong pressures for migration and mobility, as well. If there is one thing that I would hazard to say that the international community has failed in, it is managing migration and mobility. We have done lot on trade, imperfectly, a lot on investment, a lot on labour standards, but we have done very little on migration and mobility.

I have heard in India a lot said about India’s capacity, with its demographic dividend, to send workers, to man, to woman, to staff, other parts of the global economy. Can I offer just a word of warning around that? If that is seen as simply a compensation for not been able to create enough jobs domestically, if it is reductive attitude which says, well we can export labour as a commodity, then I think we ought to be careful. Labour, according to our Constitution is not a commodity. These are human beings imbued with rights and those rights need to be respected and that has to be taken into account. So, demography.

The third element – and I can be quick on this one - is climate change. It was one of the great bits of news, in an otherwise somewhat gloomy year last year that the world was able to come up with an agreement on climate change at the Paris Conference in December. And this impacts enormously on the future of work, because it places, quite properly, constraints on the world of work, technologies and activities which we must forego, but it offers opportunity as well, major employment opportunities. And I paid a call to the NITI CEO before coming here and I was delighted when he told me that India’s 15-year vision, which is in process of being formulated, will have as two key reference points: The Paris Climate Change Conference where India is determine to meet the obligations that they took up there, but also the United Nations Sustainable Development Agenda for 2030, and I am going to come back to that in a moment. So climate change, the greening of our world of work. Our future of work will be green or else it won’t be sustainable.

The fourth, or the third-and-a-half mega-driver of change is something which is crystalizing in my mind. I don’t hear it so much but I think it is implicit in the conversation, and let me explain it in this way.

For the time that I have been active in the world of work, for the last 25 years or more
I think there has been an assumption from all of us, with a greater or a lesser degree of enthusiasm, that globalization, and accelerating and deepening globalization, is going to be almost as an irreversible fact, the context in which the future of work plays out. That has had its supporters and that has had its critics, but I think it is the assumption upon on which we have all operated. I detect -- and this is a matter of the last twelve months or so and you are going to say as a Brit, I am a little bit obsessed with Brexit -- but I detect a growing defensiveness -- political, social and economic -- towards globalization, a pulling back of countries, sometimes accompanied by a defensive, nationalistic sort of sentiment that globalization, as it is currently moving forward, is being questioned. And some of the assumptions that we have taken as given for the last 25 years are going to be called into question.

You may not agree with it and you might find this a very negative view. I don’t like it but
I detect it. We need to think about this assumption that globalization is inevitably the best way to organize our affairs if – and this is a big if -- if globalization is incapable of dispensing its benefits more equally and more widely than it has done so far. I explain Brexit in my own country by the inability of Europe to dispense its benefits, particularly to the lower levels of the social strata. I have no doubt about that.

Those are the things which I think will drive change in our global economy, which are driving change in our global economy. I believe that there is considerable reason for optimism about the future of our world of work, if the international community is ready to address these issues and to react to them, indeed to anticipate and shape them, on an international level and with a notion of a general interest in a common destination.

And let me just try in my closing remarks to say how I have been struck by what is happening in India. I have told you already why I believe India is so fundamentally important to this discussion. It is not an act of courtesy to you. It is something I believe and I detect.

As I have said, India seems to me to be set upon shaping its own future with determination and with confidence, and I welcome and applaud it. But we know that India faces enormous challenges as well. Seven point six percent (7.6%) economic growth is unparalleled in any major economy today. You’re growing at twice the trend rate of the global economy. That’s great. But talking to all of you, whether you come from government, you come from employers, you come from the workers’ side, it is clear that there are underlying challenges that should not be and cannot be obscured by that headline. I could run through them all but you won’t thank me for doing it.

But I am interested in the process of structural transformation in India. India has a very interesting physiognomy of economic activity. You have a very big service sector, but a pre-industrial, pre-manufacturing service sector. It is not the post-industrial service sector.
A major agricultural sector, still. And of course, this focus on “Make (in) India” in the manufacturing sector. It is a fascinating concurrence of circumstances, and I look forward to seeing how you work it all out.  A lot of comparisons are made, you may think in an unhelpful way between the development paths that other countries have taken
- I inevitably think of China - and the difference with India.  My personal view is India will make its own path. You’re not imitating or not following in the footsteps of others.  And as you do so I hope that three things happen.

Firstly, I hope that the issue of gender is integrated into that development path. It is a source of, to some extent puzzlement, and also of worry, that the level of women’s participation in the labour market in India is penultimate in the G20 grouping. Only Saudi Arabia does worse than India. And what is more worrying is that level of participation is going down, not up. Something is at work which is complex, something which I think merits your collective attention. So, gender.

Secondly, I hope that the issues of formalization find a satisfactory part in the direction that you travel. 93% informality is a dramatic circumstance and I think at the ILO
- Mr. Modi and Mr. Chandrasekharan and the Secretary too - have been a part of this, we have a consensus between governments, workers and employers, that the right thing to do is to formalise the informal. There was once an idea that informality was an incubator of entrepreneurial dynamism. We’ve gone beyond that. Formalization is the right road to go. And as India moves forward I trust that that issue will be tackled as well.

Finally, the issues of poverty. When the United Nations General Assembly adopted its Sustainable Development Agenda in September of last year -- 17 Sustainable Development Goals -- the overarching objective is the elimination of extreme poverty in the next 15 years. Now despite the enormous progress that India has made, one of every four poor people in the world lives in your country. So, as I said earlier on, the success of 2030 Agenda will be India’s success and India’s success will be the 2030 Agenda’s success. There can surely be no greater prize than that.

So thank you so much. Thank you for being here. Thank you for listening, thank you for making this event possible, but above all, thank you for joining in a reflection on something which as Madame Pillai said, if we think about it, like a five-day test match makes us understand that as we design and shape the future of work we are designing the future of humanity, we are making a future for our children and their children, and we are building social justice upon which peace depends. And that’s worth, I think, the efforts of every single one of us.

Thank you so much.