Dwindling workers’ rights, growing automation, and expanding your personal brand: What the future holds for young workers in an aging society
For the first time in human history, the population pyramid is being reversed. Fewer and fewer working-age people are supporting an ever-growing number of pensioners.
The question of what this means for our societies, for both workers and retirees, is already bubbling under the surface in many countries.
France, for example, was convulsed with protests when the government unilaterally raised the minimum retirement age by two years to 64, citing financial sustainability in an aging society. China has attempted to undo years of demographic manipulation by tearing up its one-child policy, as its demographic dividend looks set to become a demographic deficit.
These changes are just the beginning. For Seoul National University professor and Salzburg Global Fellow Hyeok Jeong, an extreme example of what could happen is South Korea, which has a rapidly aging society and the world’s lowest fertility rate of 0.72 births per woman.
1. Workers will have less power
“Because of this trend of the shrinking size of young working populations, it is possible that this group will lose its negotiating power vis-à-vis wider society,” Hyeok predicted. This loss of negotiating power could leave younger workers de-prioritized when decisions are made about their future because they constitute a smaller political force within the wider population.
How this pressure on workers affects their rights, he explained, depends on the type of worker - domestic or foreign.
“For foreign workers, usually their wages will be lower than domestic workers, partially because they are often considered low-skill workers. Because of this, they have even lower negotiating power, or sometimes no negotiating power, with the state they move to. If there is no social safety net or labor market institution to protect their rights, it is very likely that their rights will be abused,” he said.
Countries facing labor-force pressures are likely to “start inviting foreign workers, and their rights will be a question, while domestic workers will feel very insecure,” said Hyeok.
Protections via labor unions or other forms of collectivization is “one way” to manage this potential situation, but this leaves anyone outside the union just as, if not more, vulnerable to encroachments on their rights and protections.
“The real protection should come from the availability of jobs,” concluded Jeong.
2. Workers will have more competition from machines
Ian Ryu, head of technology partnerships at US-based technology venture capital firm FedTech, believes that the private sector stands to play a significant role in helping societies weather this global demographic transition, but its role will be complicated.
Innovations on the factory floor or in the fields have been automating jobs humans have done for decades, and there has always been a cost to this.
“Automation tends to lead to higher productivity and more consistent products, which means higher customer satisfaction,” said Ian, adding that this has often meant some people are left behind.
The question for Ian now is how we empower workers to adapt to not just the ongoing fourth industrial revolution of complex digital automation, but also the increasing prevalence of generative artificial intelligence (AI).
Research suggests that one in five workers’ jobs have a “high exposure” to AI, meaning that their jobs could one day be automated. While some working in jobs as technical writers and web developers currently report that AI is helping them do their jobs better, Ian warned that this may not always be the case: “It will be harder to distinguish what an AI produced and what a human produced. And some people will lose their jobs because of that.”
3. Workers will need to re-skill
The private sector is “hugely interested” in the issues of demographic change and what this means for the workforce, Ian further explained.
“Demographic change means you have to work with different types of workers. Your talent pool is changing - that means the private sector has to respond.”
This might mean changing hiring strategies, for example, to identify and hire older talent that may have previously been dismissed as too old (consciously or not). Already, this is underway in the UK, with more than 50 large businesses signing a pledge to improve their recruitment, retention, and development of older workers.
Demographic changes matter for knowledge and experience, too: “There has to be a good pipeline of talent, otherwise institutional knowledge in companies gets lost,” said Ian.
The private sector can also work with governments and nonprofits to address issues surrounding the labor market, he said. On a local or even national level, this could be training or re-skilling programs for at-risk workers - and it requires leadership on both sides to deliver it.
When it comes to the demographic transition, he stated that a key concern is a skills shortage.
“When it comes to skilled workers: ready for an uncertain future and to be flexible and adaptable, this is where the challenge lies. Being flexible or highly agile is very important.”
4. Workers will need to manage their own personal brands
Ian argued that changes in digital social connectivity are already underway, changing how we work. “The trend we are facing is we are asking individuals to be more multifaceted. Now, everyone’s got a personal brand, and because of the growing digital economy, people can now diversify their incomes through things like YouTube, TikTok, and other social media, for example, or freelancing platforms like Fiverr.”
He warned: “People who can do that will thrive more, people who cannot, will suffer more.”
5. Workers won’t need to work?!
Protecting the rights of this dwindling number of skilled workers as they support an increasingly large aged population is not simple, Ian said.
“There are several ways worth exploring that could address this, and one is Universal Basic Income - maybe that could be the solution. But that also has potential downsides.”
Universal Basic Income (UBI) is a regular direct payment made by the state into the hands of the people, with no strings attached. It has already been trialed in 160 places around the world, from the UK to Finland, Alaska, and Kenya. There is a growing body of evidence that not only are people who receive UBI payments happier and healthier, but they’re also often more likely to find better jobs because of the stress and pressure it alleviates.
While the concept has only been used on a large scale in oil-rich places like Iran and Alaska, calls for its introduction have been renewed as the potential scale of economic change and exclusion set to be introduced by AI has become clear.
Critics argue that UBI is inflationary and removes any incentive for those in receipt of cash payments to better themselves and their lives. But, as demographics change, automation centralizes the production of value with AI companies, and a dwindling number of young workers find themselves ever more stretched, Universal Basic Income could be a lifeline - not only for the workers themselves but also for those who rely on them.
This article featured in our digital publication, which includes more coverage from the KFAS-Salzburg Global Leadership Initiative program on "Uncertain Futures and Connections Reimagined: Connecting Generations".
The KFAS-Salzburg Global Leadership Initiative is a multi-year program that annually brings together an international, intergenerational, and interdisciplinary network of Korean and global thought leaders to create new connections and tackle global challenges.
