New technology is changing the future of work with unprecedented speed and intensity, driving the reinvention of our lives and economy. Advances in robotics, artificial intelligence (AI), and machine learning push the frontier of what machines can do, making use of huge increases in ever-cheaper computing power and exponential growth in the data that’s available to train them.

These newer generations of more capable autonomous systems can perform a range of routine activities faster and more cheaply than humans. They are also increasingly capable of accomplishing activities that involve cognitive capabilities such as making judgments or sensing emotion. As a result, innovative companies are using them to augment the human workforce.

By adopting such systems, these companies are helping their workforce become more productive over time, and more able to redirect their focus to critical tasks. But how quickly will the use of these advanced technologies become a reality across every workplace and what kind of skills gaps will this create? What should businesses do now to help prepare and upskill their workforce? And, given the intense competition expected for people with these new skills, how can organizations best position themselves to win the war for talent?

 

AI’s role in the future of work

AI-powered systems can help businesses improve performance by reducing errors and improving quality and speed. In many cases, they can also boost productivity in a way that goes far beyond human capabilities.

Healthcare providers, for example, benefit from AI systems that analyze massive amounts of unstructured data and produce predictive diagnoses to help detect issues before they become a serious health risk. In capital-intensive industries such as manufacturing, AI-powered machines can eliminate faults and idle equipment.

Such developments have the potential to bring substantial benefits to businesses and economies worldwide. Research from Accenture, for example, suggests that AI could boost economic value by $14 trillion across certain industries in terms of ‘gross value added,’ a close approximation of GDP that accounts for the value of goods and services produced in a certain sector.

At the same time, once the adoption of AI and automation becomes more widespread, businesses will need to grapple with some challenging workforce transitions. We’ll see machines carrying out more of the tasks currently done by humans, for example, complementing the work they do but also displacing some workers.

However, research shows that the fear of robots taking over is misplaced. Instead, growth in demand for work will continue, and consequently, in jobs for humans. McKinsey developed scenarios for labor demand to 2030, based on various catalysts of ; it for work, such as productivity growth and rising incomes, as well as factors such as demographic trends that will lead to increased spending on healthcare.

These scenarios showed a range of additional labor demand of between 21% to 33% of the global workforce (between 555 million and 890 million jobs) to 2030. “This more than offsets the number of jobs lost, which in our midpoint scenario was 15% of the global workforce or 400 million workers,” says James Manyika, Chairman, and Director of the McKinsey Global Institute. “So, there will be ‘jobs gained’ as well as ‘jobs lost.’”

 

How will jobs and skill sets change?

More than three-quarters of hiring managers expect a growing need for skills in data analysis, data science, and software development. But to thrive in the AI-driven future of work, companies will also need employees who can quickly acquire completely new skills, such as how to adapt to and collaborate with the increasingly capable machines alongside them in the workplace. They may also have to move from declining occupations to growing and (in some cases) entirely new ones.

The World Economic Forum believes the workforce shifts this entails will be significant, with up to 35% of the skills currently in demand likely to change by 2020.

Many business and IT executives have already started to assess the implications of these coming shifts, along with AI’s central role in driving them. In fact, 62% of hiring managers we surveyed believe that AI will change how we work within five years, while 59% say AI will impact the skills their companies need. They also recognize that other emergent technologies, such as the Internet of Things (IoT), will spark similar transformations.

Even so, companies may be underestimating the sheer scale, speed, and scope of the workforce transformations that lie ahead. Tom Puthiyamadam of PwC has written about how constant technological change in the digital era is causing the “half-life of skills” to rapidly fall. In his view, preparing for the Fourth Industrial Revolution isn’t simply about understanding technologies like AI, the blockchain, or IoT.

“That's only about 10% of the challenge,” he says. “The bulk of the challenge is dealing with the pace of change we’ll all be subjected to … Your competence will become out of date faster and faster as technology advances.”

That view is reinforced by research, which indicates that not enough employees have the skill sets required to take on the digital changes they’ll soon have to roll out. Already, 52% of IT leaders say skill gaps are a major challenge at their organization. Eighty-seven percent of companies say universities and colleges are not adequately preparing students for today’s jobs. Some estimates suggest that in 2017, there were fewer than 50,000 computer science graduates available to fill 500,000 vacant developer jobs. And that was just in the U.S.

In the words of Peter Schwartz, Senior Vice President of Strategic Planning at Salesforce, this means that “the real challenge engendered by AI may be a persistent shortage of skilled labor.” In response, then, companies must look closely at, and upskill, their human capital to prepare their workforce appropriately.

 

How will automation impact the future of work?

The process starts with managers gaining a sound grasp of the types of tasks that AI and machine learning can do better than humans, as well as those where it does not perform as well.

Studies have found it’s technically difficult to automate unpredictable and complex physical tasks, for instance. What’s more, technologies such as machine learning seldom, if ever, replace entire occupations. “Our research has found it’s more a case of replacing or transforming specific tasks within an occupation,” says Erik Brynjolfsson, Director of the MIT Initiative on the Digital Economy and professor at MIT Sloan School of Management.

That means workers may need to learn how to do their jobs differently and often learn to do new tasks at the same time. “To help workforces adapt, managers must acquire a deep understanding of the inputs, outputs, and constraints of each business process, with participation from all stakeholders.”

Brynjolfsson also notes that business process redesign for AI is exactly the kind of task that can’t be automated because it requires skills such as creativity and leadership that only humans have. While machines may take over tasks involving high-volume routine work, they perform much less well at abstract tasks involving such human capabilities. So, innovating and managing people, to take just two examples, will be almost impossible to hand over to a robot, no matter how well programmed it is.

That’s backed up by research, which found that 73% of hiring managers say creative thinking skills will become more important in the AI-driven workplace.

“AI is unlikely to replace emotional intelligence or creativity,” agrees theoretical neuroscientist Vivienne Ming. “That’s why the future of work will be defined by people that you can give an open task to, without a lot of direction, and trust that they’ll make progress on it themselves. These creative, strategic thinkers have the skills that we’ll become desperately hungry for in an AI-powered future.”

Terah Lyons, former policy advisor to the White House Office of Science and Technology and Policy under President Barack Obama, puts it this way: “Truck drivers and housekeepers make about the same money, but while truck driving can be automated, housekeeping requires skills that machines can’t replicate. So, it’s not as simple as looking at pay scales, and I don’t think we have to worry any time soon that these kinds of positions will be automated out of the marketplace.”

 

What new job categories will emerge?

New categories of jobs and skills will be needed at the human-machine interface. Paul Daugherty, Chief Technology and Innovation Officer at Accenture, believes that businesses will increasingly rely on highly qualified “trainers” to teach AI systems how they should perform, to make fewer errors, avoid harmful bias, and get better at mimicking human behaviors.

At the same time, “explainers” will be required to bridge the gap between technologists and business leaders, clarifying the inner workings of complex algorithms to non-technical employees. And “sustainers” will also be needed to ensure that AI systems are operating properly — that is, as tools that exist to serve humans, making our work and lives easier.

“Fusion skills” will also emerge in the AI-driven workplace of the future. For instance, in the past, technological education went in one direction: people learned how to use machines. But with AI, machines can also learn from humans. In the future, people will perform tasks alongside AI agents and in doing so, learn new skills. A new kind of “reciprocal apprenticing” will become the norm.

Daugherty believes that in every case, AI will offer its greatest value by augmenting the work that people do, allowing us to become more effective and efficient. Suchi Saria, Assistant Professor of Computer Science, Health Policy and Statistics at Johns Hopkins University agrees. “Take the example of farming,” she says. “A hundred years ago, 26% of the population used to be involved in farming. Now, it’s only 1% – yet our product is higher in value than what it used to be 100 years ago. We eat more, we eat nicer things, and we have far more individuals in the service industry, using the benefits of that progress. Nutrition has expanded considerably as a field, for instance.

“Hopefully, AI’s impact will be in the same vein, and this new revolution will be about allowing people to do more.”

 

What can leaders do to prepare for the future of work?

For companies to ensure their capabilities are as relevant as possible for the future of work, they need to pivot away from traditional workforce development practices. Instead, they need to take responsibility for helping employees evolve their skills specifically for an AI-driven environment.

 

We’ve identified three steps to successful retraining and upskilling for AI:

1. Make a culture of continuous learning the norm

Helping people update their skill sets to understand and collaborate with machines will need to be an ongoing process in the fast-moving age of AI.

Innovative companies are looking beyond traditional education platforms such as schools and colleges to achieve this, investigating new approaches to retraining and reskilling the existing workforce.

“Education can and must be reinvented, using some of the same digital tools that are transforming business,” says Brynjolfsson.

He cites massive Online Open Courses (MOOCs) as one example of how digital tools, machine learning, and an “experiment and test” mindset can radically speed up and personalize the acquisition of skills. “These can also be applied to diagnose people’s strengths and weaknesses, and help businesses develop a holistic program for continuing skill improvement.”

2. Ensure the buy-in of all employees

“This will make the difference between an AI rollout succeeding or failing,” says Marco Casalaina, Vice President, Product Management at Salesforce Einstein. “If customer service reps don’t trust the insights they are given from an AI-powered system, they won’t use them. If an agent feels that AI is another monitoring system or that they’ve lost control of their work to a machine, they will resist.”

Technology futurist Tamara McCleary agrees. “The forward-thinking, innovative CEO of today is the one who’ll be having an open dialogue with internal stakeholders and addressing any fears head-on,” she says. “They’ll be talking about the direction of the company and how the company wants to support those within the workforce who would like to learn new skills.”

Use upskilling programs as a differentiator in the war for talent

As demand for skills in the intelligent era heats up, so too will the battle for the people with those skills. “The companies who invest in their employees and cultivate a culture of continuous learning will become employers of choice,” says Sarah Franklin, Executive Vice President Developer Relations and General Manager of Trailhead, Salesforce’s online learning platform. “Skill-up employees by offering personalized online courses and allocating time on the job to learn these new skills or partner with workforce development programs to source untapped talent. Companies that prioritize employee learning will have a huge advantage when it comes to attracting top talent.”

Closing the opportunity divide in the future of work

Upskilling the workforce of the future isn’t simply a technical affair. It has a social and ethical dimension as well. For example, there is a leadership imperative to build AI systems responsibly and ensure that workers commit to using them in a way that is transparent, accountable, and free from bias.

“An algorithm can only be as unbiased as the data being used to train it, and the perspectives of the people who program it,” says writer, speaker and startup advisor Theodora Lau. “Hiring a diverse workforce will help reduce our unconscious bias and provide more well-rounded perspectives to better serve customers and avoid unintended negative consequences.”

At the same time, by partnering with colleges and universities to help them develop relevant curriculums that prepare students for an AI-powered future of work, businesses can help to ensure that more skilled people can enter the workforce. In so doing, they can play a vital role in helping societies get from today’s economy to a new economy that gives more people an opportunity to prosper.

This approach doesn’t just help to reduce skills gaps, it can also minimize workforce disruption. In the words of Jacob Morgan, technology futurist and author of The Future of Work: Attract New Talent, Build Better Leaders, and Create a Competitive Organization: “If we do see widespread job displacement in the future of work, it won’t be because of technology. It will be because of our inability to train employees to use AI or upskill them.”

Gerald Chertavian, founder and CEO of independent workforce development organization Year Up, puts it this way: “If you don’t start to provide equitable access to opportunities that enable individuals to start and build their careers, they won’t be able to keep up. You’ll see greater unemployment at the lower end of the skills base and a perpetual underclass that really can’t generate the income and earnings they need to live decent lives.

“So, it’s about preparation for the right jobs, the new jobs created by this revolution, starting at the very beginning.”

Learn more about the future of work — and how your company should respond — in our Future of Workforce Development report.