How Will Technology Affect the Job Market? Key Insights from the WEF's 'Future of Jobs' Report

If you'd like to get a brief outlook on the global labor market and its transformation during the next years, you're in the right place. In this article, I've collected the main insights from the 2023 Future of Jobs Report by the World Economic Forum. Since its first edition in 2016, the report carefully tracks the labor-market impact of the Fourth Industrial Revolution. So, let's check what labor-market transformations to expect and discover the main triggers for them.

Adoption of Frontier Technologies Are Going to Drive Job Growth

Right off the bat, I'd like to start with the influence of macro trends and technology trends on jobs and skills in the nearest future. The survey shows that more and more businesses are expected to adopt new and frontier technologies and broaden their digital access. These are the two main trends during the next five years in over 85% of the organizations surveyed.

Notably, technological advancement through utilizing new technologies and increased digital access are also expected to drive job growth in more than 50% of surveyed companies.

The World Needs More IT Specialists

Technology is changing not only the way we work, but it's also rapidly changing the job content and sought-after skills. And understanding how exactly technologies will influence the labor market is crucial for determining whether people can transition to the "jobs of tomorrow."

As you see, digital platforms and apps, big data, cloud computing, the Internet of Things, and AI will be adopted by 75% in the next five years. It means that more and more IT specialists who can work in these fields will be required. With that, workers should stop worrying that they will be heavily substituted by robots as the adoption of non-humanoids ranks lowest on the list. Previous editions of the Future of Jobs Report have already focused on the correlation between human work tasks and machines or algorithms. That's why I can come up with the exact numbers. Now 34% of all tasks are performed by machines, while the remaining 66% are performed by humans, representing a 1% increase in automation from the report's 2020 edition. Such a low pace of automation contradicts the previous expectations that almost half of the business tasks would be automated in the following five years. From this, it's easy to conclude that task automation will not reach the expected 51.3% by 2027. Yet, the potential scope of automation and augmentation will further increase over the next five years, with AI technologies finding mainstream applications across numerous sectors. For example, recent studies found that Large Language Models can already automate 15% of tasks. And if combined with applications that can correct factual inaccuracies of Large Language Models, this share may increase to 50%.

"Jobs on the Rise"

The report includes the results of the recent research conducted by LinkedIn, the world's largest professional network, to keep us up-to-date with the most popular job sectors predicted to increase within the next years. The research is known as "Jobs on the Rise," it describes the 100 spheres that have grown the fastest over the last four years.

Predictably, Technology and IT are among the Top 3 "Jobs on the Rise." Such rapid growth can be attributed to the increasing adoption of technology across most industries, the need for digital transformation, the reliance on information systems, cybersecurity concerns, and the continuous emergence of innovative technologies.

What Are The Growing and Declining Jobs?

Going deeper into increasing job posts, I'd like to highlight that AI and Machine Learning specialists are at the top of the list, followed by Sustainability Specialists and Business Intelligence Analysts.

This table clearly shows that the fastest-growing roles are driven by technology, digitalization, and sustainability. Renewable Energy engineers and Solar Energy engineers are also becoming highly demandable as many industries are shifting towards renewable energy. It's worth noting that the fastest-declining roles are also driven by technology and digitalization. Automation is going to gradually substitute Secretarial roles, Clerks, and Cashiers. To be more precise, the report shows that such roles as such as Data Analysts and Scientists, Big Data Specialists, Business Intelligence Analysts, Database and Network Professionals, and Data Engineers will undergo a 30-35% increase (1.4 million jobs) due to the integration of frontier technologies which rely on big data. Demand for AI and ML specialists is expected to grow by 40% (1 million jobs) as the utilization of AI and ML continues to be the critical factor of industry transformation. We can also expect a 31% increase in demand for Information-Security Analysts, resulting in 0.2 million additional jobs. It is caused by the enhanced adoption of encryption and cybersecurity because of the increasing number of cybersecurity incidents.

The Most Sought-after Skills: Cognitive Skills, Self-efficacy, and Technology Skills

Finally, I've come to the most critical question "What skills are needed for these professions? How to stay demandable in the nearest future?". As the previous report showed, Analytical Thinking will remain the most sought-after skill required by most companies (constitutes, on average, 9% of the core skills reported by companies). Cognitive skills and creative thinking are ranked the second core skills, followed by self-efficacy skills, including resilience, flexibility, and agility. Though management skills, engagement skills, and technology skills are considered less important than self-efficacy, they will still play a critical role in the future.

Speaking about business expectations, it's worth noting that cognitive skills also top the list of "Skills on the rise." Companies will seek employees who can solve complex problems in the workplace effectively. Surveyed businesses also report that creative thinking will also grow in importance slightly faster than analytical thinking. By the way, technology literacy is the third-fastest growing core skill. Systems thinking, AI and big data, talent management, and service orientation complete the top 10.

How Companies Assess Skills when Hiring: Online Courses and Certificates Really Matter

It's always economically beneficial for companies to hire a specialist who already has the needed skillset. But how to access that skillset? In 2023-2027, companies will continue to evaluate work experience the most when hiring new workers. Positively, more companies now report that they will use skill assessments (47%) rather than pay attention to university degrees (45%) to select candidates. Furthermore, almost 20% of surveyed companies will willingly hire employees who have completed short courses or obtained online certificates.

Wrapping Up

Ultimately, the Technology and IT sector will experience rapid growth due to various factors outlined in the Future of Jobs Report. The increasing adoption of new and frontier technologies is expected to drive job growth in the next five years.