The World Economic Forum (WEF) has released their Future of Jobs Report 2023, revealing relatively unsurprising statistics on the upcoming impact of geopolitical events and emerging technologies on the transforming labour market.

According to the report, the job market is still reeling from the lasting effects of the Covid-19 pandemic, which brought a major labour shortage as well as supply chain interruptions which disrupted global markets.

The cost-of-living crisis continues to excacerbate local economies, challenging consumers and companies alike as the energy crisis in Europe was worsened by the invasion of Ukraine.

Further, the impending impacts of climate change have ushered in a flurry of hasty sustainability initiatives pushing companies for cleaner energy usage, causing a host of job market transitions.

Emerging technologies have caused a cataclysm in the once stable tech industry — which faced major layoffs this year among its largest companies — as CEOs recenter their strategies on artificial intelligence (AI).

The WEF’s report has shown the emerging technologies are expected to drive the biggest changes in the global job market.

By surveying employers in different industries across the globe, the report shows that AI and machine learning (ML) will hold the fastest growing roles in the next five years.

Macrotrends
86.2% of organisations surveyed have found that increased adoption of new and frontier technologies will be the biggest trend driving business transformation in the next five years.

Broadening digital access (86.1%) follows closely behind in importance, as lessening the digital divide will allow the widespread adoption of technologies and widen the breadth of tech-skilled workers.

Still, factors outside of technology will continue to influence the job market into 2027.

80.6% of organisations found that broader application of Environmental, Social, and Governance (ESG) standards will push companies to transform their businesses.

The rising cost of living (74.9%) and slower global economic growth (73%) were also viewed as major drivers to business changes.

For the job market, each implication takes a different turn.

Investments to faciliate a green transition in businesses (52.2%) as well as the push for ESG standards (51.4%) were seen as likely to create jobs in the next five years.

New emerging technologies are expected to lead to a net 36.4% increase in job creation in the next five years.

The rising cost of living and slower global economic growth were both seen to lead to net decreases in jobs, at -19.3% and -44.4% respectively. Supply chain shortages are also likely to cause jobs to be displaced (-23.7%).

Technology Adoption
Marking the unavoidable importance of technology trends to the global job market, the WEF gave technology adoption its very own section in its annual report.

As it is a global, cross-industry report, the WEF could not make specific inferences on the digital adoption strategies of technology companies, but overall the trend is upwards.

Digital platforms and apps came in as the number one technology that organisations were looking to adopt in the next five years, at 86.4%.

Education and workforce development technologies (80.9%) and big-data analytics (80%) were in the next two spots.

While these technologies may seem obvious steps to technology specialists, it does show the wide range in the current scale of digital adoption across various global industries.

Artificial intelligence (AI), which is the new coveted innovation among top tech companies, was projected to be adopted by 74.9% of companies by 2027.

Cloud computing is also set to be on the rise, with 76.6% of companies aiming to adopt this technology in the next five years.

The Internet of Things and connected devices (76.8%) is another technology organisations are looking to invest in, along with encryption and cybersecurity (75.6%) as threats mount.

E-commerce and digital trade are set to be adopted by 75.3% of organisations, showing the influence of digitalisation in these industries.

Despite ESG being identified as a major driver of business transformation, environmental technologies and climate change mitigation technologies are only set to be adopted by 64.5% and 62.8% of companies within the next five years respectively.

The impact of technology adoption on jobs in the next five years ranges depending on the technology adopted.

Big-data analytics is set to lead to a 58% net job increase, followed by climate change mitigation tech (49.5) and environmental management technologies (45.8%).

Encryption and cybersecurity will also lead to a large net increase in job creation (43.3%). In the UK, this could prove problematic as the skills shortage has taken a particular hit in the cybersecurity field.

The adoption of robots — of humanoid and non-humanoid nature — were the only technologies set to cause a net decrease in jobs, at -2.6% and -8.8% respectively.

While AI is feared to replace many jobs, the WEF report projects it will actually lead to a 25.6% net job creation increase, though it will also lead to a near 25% job displacement as well.

Indeed, AI is set to be a job interrupter as industries across the board reckon which how and where the emerging technology is best used.

“Organisations today estimate that 34% of all business-related tasks are performed by machines, with the remaining 66% performed by humans,” the authors of the report wrote.

This is actually a decreases projection from the WEF’s 2020 report, “possibly reflecting a view that machines and algorithms have augmented human performance rather than automating tasks in this period,” the report read.

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In fact, most projections for the amount of tasks that will be automated match predictions made in 2020 for the current landscape.

Technology Skills
Skills surrounding technology are projected to increase across different industries.

71.9% of care, personal services, and wellbeing organisations rank technology skills as a top priority of their five year strategies.

Information and technology service organisations also plan on improving their technology skills, with 67.4% ranking this is a priority.

In terms of reskilling initiatives, AI and big data are up 12 points compared to the 2020 data on their importance to companies. However, it ranks 15th as a core skill for mass employment in today’s market.

Skills in AI tools now exceeds computer programming, network and cybersecurity skills, technology literacy, and design and user experience in importance.

While a small number of companies think AI may be a passive fad and is currently overemphasised, a net 59% of companies predict AI will only continue to grow in importance.

“Though generative AI has the potential to displace jobs, the focus placed on training workforces to exploit AI and big data indicates the opportunities for new roles which harness its potential to help achieve business goals,” wrote the report’s authors.

Barriers 
The skills gap and the inability to attract talent are listed as the top two barriers preventing industry transformation, according to the report.

59.7% of businesses blame the skill gap for a delay in their transformation, where as 53.4% recognise their inability to attract talent as a major fault line in their ambitions.

The size of a business does play into these perceptions, however, as SMEs were 20% less likely to say a lack of skilled talent was a barrier to their transformation than larger companies.

To combat these barriers, workforce strategies include investment in training on the job (reported by 81.2% of companies) and accelerating the automation of processes (80%) to lessen reliance on the workforce.

Conclusions

“Global macrotrends and disruptions create an ever-more complex environment for policy-makers, employers and workers to navigate, and uncertainty and volatility remain high,” the report concluded.

Sociopolitical changes have certainly impacted predictions on the next five years — and emerging technologies are set to make a big impact on business strategies looking forward.