For the past several decades, global supply chain (GSC)-related employment has expanded as new forms of work and production fragmentation have spread worldwide. An important aspect of these developments is the rise of the so-called “servicification” of manufacturing. This occurs when manufacturing-related GSCs create jobs not only in the manufacturing sector itself, but also in services sectors by using more and more services inputs in the manufacturing process. Due to the improved tradability of services, this is occurring across both developed and emerging countries. In fact, the number of services jobs depending on manufacturing demand in GSCs has been increasing both in terms of number and share in total employment. For 2011, among the 40 countries with available data, it is estimated that 96.6 million people or 4.5 per cent of total employment is in services-related jobs that depend on the manufacturing sector – an increase of nearly two-fold compared to 1995.

Figure: Servicification jobs in 40 countries in comparison with other types of jobs, 1995–2011, Index (1995=1)

As supply chains extend their reach beyond traditional manufacturing, it merits considering the implications this may have on job creation and quality. Indeed, while the servicification of manufacturing creates new employment and business opportunities, there is some indication that participation in GSCs as suppliers can boost productivity, but there is no discernible effect on wages. The trend increase in servicification (and GSCs more broadly), therefore, requires the implementation and monitoring of effective measures to ensure the decency of jobs across and along the supply chain.