What about skills in the digital age?

Main messages
  • Importance of anticipating skills needs and timely reskilling and upskilling
  • Increasing demand for high-skilled white-collar workers
  • Adoption of some technologies risks deskilling in the labour market
  • Greater emphasis needed on the development of transversal and management skills

Importance of anticipating skills needs and timely reskilling and upskilling

Digitalisation is changing the products and services on the market and the processes through which they are provided. In addition to having a quantitative employment impact – job creation and job loss – this has a qualitative employment impact in terms of the skills needed. Newly emerging job profiles, as well as changing task composition in existing jobs, will require that workers are equipped with new or different skills. To ensure people’s employability, it is important that they receive an adequate initial education but also that they engage in lifelong learning activities, as it can be expected that, as technological change progresses, the skills required will be in flux.

An important precondition for providing and attaining the skills required in the labour market is that future skills needs are anticipated well in advance, so that education and training curricula can be adjusted, if necessary, and effectively implemented. Furthermore, workers need to be made aware of the future skills needs identified and supported to re- and upskill, particularly if they may lose their jobs as a result of the digital transition.

  • At European level, the European Centre for the Development of Vocational Training (Cedefop) provides various tools to anticipate future skills needs and trends in the labour market, accessible through its Skills Panorama. Similarly, across EU countries, several observatories, surveys and administrative data repositories have been established to map supply and demand in the labour market, often with a forward-looking perspective intended to help in anticipating future skills needs. Such efforts should be maintained and, if necessary, further developed to focus on skills needs in the digital age. One potential means of doing so is through greater involvement of social partners (as already implemented in some existing measures).
  • In anticipating skills needs for the digital age, attention should be drawn not only to highly specialised digital skills but also to potential changes in skills needs for other staff, including those not working directly with technologies or doing so only to a limited extent. As the enhanced deployment of digital technologies is expected to impact business models and work organisation, broader changes in skills needs are likely, for all types of occupations and job profiles.
  • New or changed skills might require adaptations to education systems. The current systems for both initial and continuing education could be reviewed to ensure that they are fit for purpose and, if necessary, modified. This could be done in the framework of the European Commission’s Recovery and Resilience Facility; its priorities include re- and upskilling and the adaption of education systems to support digital skills and educational and vocational training for all.
  • Across the EU, countries already provide workers with help to identify their development potential, skills needed in the labour market and suitable training providers, and with financial support to engage in re- and upskilling. Existing instruments could be upgraded with additional funds or innovative delivery mechanisms to attract those workers with the greatest need for skills development but who are least engaged with the education and training system.
  • For those workers affected by redundancies, the European Globalisation Adjustment Fund for Displaced Workers (EGF) can play a role in supporting re- and upskilling. The EGF is a long-standing instrument aimed at helping workers who lose their jobs as a result of restructuring to find new employment. For 2021–2027, the EGF has a budget of €210 million, which can be used to fund 60–85% of the costs of projects targeting redundant workers. As experience shows that transitions in the labour market work best when there is no spell of unemployment or when it is as short as possible, pathways for providing access to training for workers facing the risk of unemployment before they actually become unemployed could in particular be further fostered.

Increasing demand for high-skilled white-collar workers

The different digitalisation technologies affect employment and skills needs differently. However, a common finding in research is an expected increase in demand for high-skilled white-collar workers who, on the one hand, can drive the development of technologies and the design of digital solutions for production systems and workplaces, and, on the other hand, can effectively implement and maintain digital solutions (for example, through data handling and analysis).

Such job profiles are likely to require, in addition to specific occupational skills, a variety of transversal skills, such as decision-making, creativity, and communication and cooperation skills.
While workers who have such skills are likely to be in a good position in the labour market, there is a tangible risk that workers who do not have these skills and face challenges in acquiring them will be left behind.

Policy pointers

  • Education and training systems should be prepared to equip workers with the highly specialised skills required for the deployment of digitisation technologies. In this regard, it is important to explore pathways to teach such skills not only to those who have an advantageous position in the labour market but also to more vulnerable groups (such as older workers or those with low formal educational attainment), in line with the European Pillar of Social Rights Action Plan and the European Skills Agenda. Curricula should not focus only on specialised occupational skills but follow a multidisciplinary approach that fosters the development and improvement of transversal skills.
  • Policy needs to ensure that those workers lacking the required skills are supported in developing them. In this respect, formal and informal learning provided by employers is important. Social dialogue and collective agreements at national, sectoral and company levels could pay greater attention to the topic of training and skills development, and relevant achievements and good practices could be disseminated and exchanged across sectors and EU Member States.
  • As there will be some workers who cannot manage to develop the required skills – in spite of all efforts by policymakers, employers and workers – safety nets are needed to ensure that they do not fall behind. This will entail a review of and, if necessary, adaptations to social protection and welfare systems, for example as regards their coverage of certain types of workers (such as those in non-standard employment relationships, which are expected to become more common as a result of increased use of some types of technology) and their financial sustainability.

Adoption of some technologies risks deskilling in the labour market

While in general digitalisation is expected to result in increased demand for higher skills, some technologies, such as automation or platforms, pose a risk of deskilling due to the fragmentation of jobs into individual tasks, which tend to be of a routine and low-skilled nature. If such tasks are carried out by higher-skilled workers over a long period of time, this can have a deskilling effect on the labour market, as well as decreasing workers’ commitment and their motivation to actively contribute to the economy, resulting in lost productive potential.

Policy pointers

  • Policymakers should closely monitor the development of job and task profiles, and hence skills utilisation, on the labour market. Social partners – in addition to existing public observatories and surveys, as mentioned above – could play a strong role in this, notably at sectoral and workplace levels.
  • If a tendency towards deskilling in certain occupational profiles becomes apparent, pathways for fostering workplace practices such as job rotation or job enrichment could be explored, to provide workers who would appreciate it with a more diverse portfolio of tasks. This could reduce deskilling risk and increase job satisfaction. Again, social dialogue and collective agreements could have a decisive role in planning and implementing such approaches.
  • Policy interventions to reduce or avoid the risk of deskilling posed by platform work will be more difficult to develop, as the fragmentation of work into small and often low-skilled tasks is in many cases a key characteristic of this form of employment and business model. This could contribute to labour market segmentation if workers conducting such tasks over a long period have limited opportunities to transition to more stable jobs in the traditional economy should they wish to do so. Policy could tackle this risk by exploring which of the wide variety of potential instruments for addressing labour market segmentation could be applied to platform work. Overcoming labour market segmentation would, in turn, reduce the risk of deskilling on the labour market.

 

Greater emphasis needed on the development of transversal and management skills

Digitalisation does not only impact demand for occupational skills, it can also affect business models and work organisation. Therefore, a change in management approaches and practices may be required, particularly where automation and digitisation technologies are deployed. Human resource and line managers need to be made aware that the opportunities for, and requirements of, staff in the digital age necessitate specific management styles and workplace practices, for example in relation to remote working, team working within and across the organisation, data generation and use, and working time. Management training should equip managers with the skills required to manage their staff effectively and efficiently in a human-centric way in the digital workplace.

Policy pointers

  • As a basis for equipping managers with the skills required, further information is needed on workplace practices in the digital age and related management approaches. Further research could explore this, taking into account the impacts of different technologies in different sectors. The findings of such research could then be disseminated to policymakers, management education providers and managers (for example, through business associations or managers’ networks).
  • Management education and training curricula should be reviewed and adapted to the particularities of workplace practices in digital workplaces. Managers need to be made aware of the need for new or modified ways of working. Examples relate to managing remote or multidisciplinary teams and teams composed of humans and machines. Furthermore, new management approaches may be needed to organise task assignment, working time, and employee monitoring and performance appraisal in a human-centric way in work environments in which technology can be used for many human resources applications – not always to the benefit of the worker. Social partners should be involved in the operational design and implementation of such management approaches, for example when introducing a right to disconnect or algorithmic task assignment and monitoring instruments. Accordingly, skills development and capacity building may be required to support both managers and worker representatives in conducting such discussions and negotiations.
  • Some technologies, notably those related to digitisation, create a substantial amount of data that can be used to improve business performance. Managers should be trained in how best to exploit such data for the benefit of the company, while at the same time fully respecting the interests of the data owners (workers, clients, etc.). Such training should have several components, for instance data analytics (including competence to assess the quality of the data and the underlying digital tool, including artificial intelligence), business strategy and data protection. This could be addressed by combining elements of the EU’s Digital Education Action Plan and the White paper on artificial intelligence.
  • Similarly, as some digitalisation technologies, notably automation and digitisation, affect supply chain activities, management education and training should be updated to cover changes in requirements related to cooperation across organisations in the digital sphere.
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