Are you ready for the future? Thanks to Covid-19, we’re living in it
Pick your disaster movie scenario. Whether it’s the killer virus or the rise of the machines, the same workers are most vulnerable to losing their jobs, says a McKinsey report.
The study, ‘Covid-19 and jobs: Monitoring the US impact on people and places’, warns that getting ready for the future is no longer a “distant hypothetical” but “a very immediate priority”.
McKinsey has also zoomed in on the UK to analyse what the combined impact of the pandemic, AI and automation could look like in Britain’s workforce.
Robots threaten women
McKinsey predicts that Britain’s GDP will suffer a 9% drop in 2020, putting 7.6 million people at risk of layoffs, prolonged furloughs, or cuts to their hours and pay. And those most at risk are our lowest-income workers, with nearly 50% of at-risk jobs earning under $10 an hour, many of them in the hardest-hit sectors like retail, construction and hospitality.
In our 20 lowest-income areas, including Torbay, Stoke-on-Trent and Blackpool, 23-29% of jobs are at risk – while in the 20 highest-income areas it’s just 15-25%.
And because of the gender pay gap and the assumption that women are not breadwinners, women’s jobs are disproportionately vulnerable. What’s more, the survey predicts that the gender pay gap will continue to widen after Covid-19, as will pay gaps between different skill categories.
This is partly because the same low-income jobs that are most at risk from the post-Covid recession are also most at risk of being replaced by AI and automation. White-collar jobs are likely to be heavily affected by the rise of the machines too, so it’s an overlap rather than a 1:1 correlation.
The future is now
It’s clear that the pandemic has drastically accelerated HR trends. Remember when contract workers were the next big thing? Or swarm teams? Now they’re the current big thing. Remember when distributed workforces were the cutting edge of innovation? Newsflash: our workforces are now very distributed. Welcome to the future.
This change to a distributed workforce is likely to last, meaning more employees will be able to work from home long-term. However, not everyone enjoys the flexible working life: some are feeling isolated and desperate to get back to the office.
That means businesses need to gradually shift focus from wellbeing and mental health support to a safe return to the workplace for those who want to make that transition. Employees’ mental health will need to remain a priority, but coupled with clear training, hygiene and social distancing protocols to protect their physical health.
In the longer term, it will mean learning to integrate home working and onsite working to create a new blended form of work that reduces local and global travel, helping to ward off that third disaster movie scenario that’s been pushed to the back burner this year.
This in turn could change the face of Britain. Companies will be able to save big on rent by selling off their large offices and working from smaller, more local offices and co-working spaces like WeWork. This in turn could herald a migration to the country, with staff no longer needing to live in big cities to work.
The recession is also likely to swell the ranks of contingent workers, with many people turning to the gig economy to replace lost mainstream jobs, as they did during the 2008 recession.
The gig economy has never quite taken off to the extent expected, with many employers suspicious of letting some rando on a laptop in Starbucks handle their projects. Now the pandemic has forced employers to trust people, and companies are less able to afford full-time workers, this could finally be the gig economy’s big moment.
The agile swarm
Another manifestation of the new pay-as-you-go approach to work is the swarm team – a temporary alliance of permanent and contingent workers created to handle a specific project and disbanded once the project is done.
While this new flexibility could lead to the redesigning of some roles, it’s also likely to mean talent managers need to focus less on headcounts and more on skills counts, meeting needs through a mix of internal talent, gig workers, outsourcing, and where necessary, automation.
A hopeful ending
Some automation will be necessary in order for businesses to cut budgets enough to ride out the recession. But bringing in AI will also call for investment in humans: the workforce will need to be trained in new digital and soft skills.
What’s more, AI may still not be ubiquitous for another 10 or 15 years. And in the kinder, gentler post-Covid business world, we’re likely to see fewer businesses racing to replace their human employees just because they can, and more making it a priority to take care of their people – because if there’s one thing this epic adventure has taught us, it’s that human beings are our greatest asset.