The Future of Work: What will be the Impact of Digitalization, and What To Do?
By now there is no doubt that Latin America’s future depends to a great extent on how the region confronts and manages major global challenges. The effects of rapid and fundamental transformations in climate patterns, information technologies, and methods of communication underscore how closely the region’s fate is tied to developments beyond its borders.
Yet, while many governments, businesses, international financial institutions, and civil society organizations across the world are concentrating more attention on long-term global trends, Latin American nations remain largely focused on short-term and national concerns. Today, most Latin Americans are simply reacting to global developments.
Only a few Latin American institutions are carrying out the data collection, research, or analysis required to understand such trends on a global level, anticipate sweeping changes, and to incorporate them into the policy making process. Yet doing so could result in better outcomes and help mitigate environmental damage, improve security, and ensure prosperity.
Against this backdrop, in 2011 the Dialogue, in partnership with the Inter-American Development Bank (IDB), launched its Long-Term Global Trends Initiative, under the superb intellectual leadership and direction of Sergio Bitar. Bitar, a Dialogue senior fellow, is uniquely suited to head this effort. An economist by training, Bitar has vast experience in politics and policy making in Chile, having served as senator and minister for several administrations.
The program seeks to strengthen the capacity of regional experts and institutions to foster more strategic thinking about the key global challenges facing Latin America.
In this new report, Bitar builds on his work over nearly a decade and focuses on the future of work in Latin America. He thoroughly analyzes the current research on this increasingly crucial topic and draws conclusions for policy design and political decisions. In this way, Latin America can better prepare for and take advantage of global changes to enhance the region’s social and economic development.
The report reviews diverse scenarios that may arise from transformations in technology, digitalization, automation, artificial intelligence, labor laws, and institutions, and the skills necessary to survive in the future. Bitar also sets out a range of public policies that Latin Americans should put in place now to avoid possible negative effects coming down the road. Policy prescriptions include investing in major digital training and education programs and new social protection measures for workers during the transition period.
Although digital transformation could increase the gap between the region and developed countries, it could also, if managed wisely, become an opportunity to leap forward, enhance technological innovation, and diversify Latin America’s productive structure. Productivity gains from the “digital dividend” could be enormous.
We are grateful to Bitar for his pioneering work on global trends and hope this report will stimulate constructive debate about Latin America’s future. We also express our deepest appreciation to the Inter-American Development Bank for its support of this initiative.
Please note: the report is only available in Spanish.
There is disagreement over the levels of impact digitalization and automation will have, making these trends to be monitored.
But, there is agreement that productivity will go up in nations that take advantage of the upcoming trends.
Inequality between skilled and unskilled workers will increase, as well as jobs that are more likely to be held by men vs. women.
Latin America can start to prepare itself for the future of work now, including by looking at educational systems, evaluating and monitoring trends more closely, and better addressing inequality that currently exists.
On April 12, the Inter-American Dialogue hosted an event titled “Latin America’s Digital Economy and Trends in International Taxation.” The discussion took place in the context of a recent OECD report, that reported that a global consensus on how to tax businesses with a substantial digital footprint but no physical presence in a given country remains elusive.
El presidente del Diálogo Interamericano, Michael Shifter, habló con Gustau Alegret del programa Cuestión de Poder de NTN24 sobre el tema de la transformación laboral, con atención especial al nuevo informe del Dialogo Interamericano “El Futuro del Trabajo en América Latina: ¿Cómo impactará la digitalización y qué hacer?” escrito por Sergio Bitar. Shifter y Alegret continuaron su conversación discutiendo las elecciones en Bolivia.