The economic expansion plan from Donald Trump, President-elect has given rise to enough debate from economists both on the left and the right. Both sides are sceptical about the larger-than-life plans of Donald Trump to modernize the tax code and questions whether or not the proposals of trade and policy are actually going to provide long run economic growth. As claimed by majority of the economists and financial analysts, politics doesn’t boost growth but productivity does. At the basic level, all that matters is how much the politicians and lawmakers are working and how productive they are. Bringing about continuous changes to the policy won’t help alone.
Off late, productivity has seen a spur since the early 2000s when IT advancements drove economic improvements and the future of the economy demands companies and businesses to do more with less. This attempt has caused increasingly large numbers of companies to push their employees to provide more in less time while also delivering good quality at the same time. But we’ve presently reached a stage where employees simply can’t give in their 100% without the help of technology. Hence the new secret lies in doing more with less with the help of machines and not people!
Structure of work requires a transformation to achieve best productivity
Yes, the best rate of productivity can be obtained only when the structure and nature of the work changes. It has been found out that workers tend to spend 3days among 5 business days every week in doing tasks which aren’t related in any way to their core responsibilities. This is because they leverage manual tools which aren’t best suited to the tasks which they are given. As per a multi-year study by McKinsey, 30% of the basic activities of the workers could easily be automated for around 65% of occupations.
Technology will drive the next productive surge for boosting economic growth
There have been noteworthy advancements in machine learning, automated bots, messaging and easy availability of all kinds of data which will probably give the final push to the surge in productivity which is required for economic growth. Such tech advancements will actually make it effortless for masterminds to build tech solutions that can perform the busiest of all works and let the employers focus on core business issues.
As per the State of Work Research, companies with 5000 or more employees that are collectively spread all over the US could save $585 billion in a year by automating few unnecessary tasks which could be equivalent to a 3.5% gain the US GDP. The gain would be equal to a combination of the annual profits of 50 large public companies across the US.
There’s a big byte in the economy
People usually think of automation only in factory lines where technology and its advances can be utilized to package or assemble products at a faster pace than human beings. But this is a restrained view and needs to go through a gross transformation. Automation driven by machine intelligence has the capability of enhancing the output of knowledgeable workers as well. Every day, people create 2.5 quintillion bytes of data and the quantification of data is not showing any signs of slowing down. Predictions by analysts expect M2M connections to reach 28 billion by 2024. Hence it seems humanly impossible for people to tackle all this data and nurture relationships between people but it is pretty much possible for machines to do that.
World Economic Forum discusses the risks of tech to jobs & political stability
While the world is happy to be technology-driven and although it’s true that technology is the only factor which can drive economic growth, it is also true at the same time that there are certain risks posed by technology to the jobs, political sector and to web security. People haven’t yet realized that the further expansion of AI or Artificial Intelligence will most likely mark the death of conventional white-collar jobs at a faster pace than at which new jobs can be created. The WEF’s 2017 Report of Global Risks warns that due to some disruptive technologies like AI, long-term jobs are getting replaced by self-employment in the ‘gig’ economy. This is leaving the individuals to carry forward more responsibility at the cost of sickness, unemployment and old age.
Eminent investment officers are of the opinion that without proper governance of this factor and reskilling workers, technological advancements can do away with jobs faster than it can create them. Governments can’t offer social protection at historic levels and hence this can soon become one of the most crucial challenges of our society.
So, what according to you is the impact of technology on our economy? Do you think the elimination of white-collar jobs will help our economy or do you support the saying that it is only technology and not politics that can drive economic growth?
