1.2 Challenges and opportunities for employers

1.2 Challenges and opportunities for employers

If you ask employers what skills and qualifications mean for them, they talk about the competitiveness, productivity and growth of their businesses. And they will tell you that their company’s value depends to a great extent on the skills of their people. As Bill Gates once pointed out: “What would Microsoft be worth if it was sold without its collaborators, one dollar?”  But skills might become the Achilles heel of a company’s competitiveness as technological innovation and growing sophistication in technology lead to large scale labour dislocation and redeployment.

Recently the International Labour Organization (ILO) and the International Organization of Employers (IOE) (2019) published a joint report entitled ‘Changing Business and Opportunities for Employer and Business Organizations’. IOE represents more than 150 employer and business organisations and 50 million companies worldwide. It is the largest private sector network in the world. The report explores five global trends that are affecting business, and the challenges and opportunities they pose for employers and businesses and their organisations. The five trends are: technological innovation, global economic integration, demographic and generational shifts, climate change and sustainability, and a global shortage of skilled labour. Our focus here is on technological innovation and the effects on skills and qualifications. 

Technological innovation has an impact on all businesses. As an example we’ll take the construction sector. Currently there is a gap between the productivity growth of the construction industry and that of the whole economy. Technological innovation is an opportunity to increase the productivity of the sector. But this requires a skills revolution. The report ‘Moving to Industry 4.0’ (MACE, 2017), based on national employer skills surveys and economic forecasting research in the United Kingdom, predicts that 600,000 current construction roles in the UK will disappear by 2040. Trades like joinery, painting and decorating, and bricklaying will all see over 94% of current tasks disappear. Drones are already used to survey large sites and inspect areas of buildings that are hard to get to. Development work on bricklaying robots has already started. The report emphasises that this should not be seen as a threat of mass redundancies, but rather as an opportunity for re-skilling workers, and the potential need to find a million more workers by 2024. The construction workers that are needed for Industry 4.0 will be mostly in the occupation category ‘non-construction professional, technical, IT and other office-based staff’. The MACE report gives four recommendations to deliver the skills for a successful transition to Industry 4.0. The recommendations could be useful for other economic sectors and countries as well, so we have generalised them:

• Accelerate the use of new technology in training; augmented reality in particular can improve the training of new skills in apprenticeships and Further Education (i.e. vocational education and training) courses. 
• Make training accessible and suitable for people across their lifetime, not only for youngsters who are entering the labour market but also for adults to upskill for a particular career path, re-skill for a career change, catch up on learning, respond to changing circumstances, remain in the labour market longer and become more productive. 
• Explore the best ways to gather labour market intelligence on the skills gaps that arise from technological changes. To ensure that the right training is available for people to fill skill gaps, we must know what the skills gaps are. 
• Revolutionise traditional education programmes. Many countries are reforming their education system, in particular the post-secondary, non-academic education and apprenticeship system. Given the rate of innovation and technological advancement that is now happening, the question is how the content of any post-secondary education programme can remain relevant. The design of curricula need to incorporate the future need for a multi-skilled, adaptive workforce; new technological advancements, and the more modern methods applied in industry. 

Things are already happening in all these fields. New ways to gather labour market intelligence are discussed in part 2 of this toolkit, ‘How do people know about skills and qualifications’. Among the many success stories we received, mostly from partner countries, are examples of using new technologies in training. For example, the DTEK Academy Training Centrum Vostokenergo in Ukraine that uses virtual reality to enable learners to develop skills which are difficult to practice because of the high risk involved in Ukraine and the Technical School in Užice, Serbia which incorporates digital technologies in work-based learning programmes through the virtual internship platform VIVET. And Georgia has established a vocational college for the construction sector which particularly targets adults.

Success story from Georgia:

A public-private partnership in Georgia established the vocational college for the construction sector ‘Construct2’. The college offers training to different target groups; individuals who do not want to proceed with higher education but prefer to acquire a vocational skills instead, and adults who want to change their profession. Construct2 also provides opportunties for adults who have experience in the construction sector but no formal certificate, which might become an obstacle for future employment.  For construction companies that want to improve their employees' professional skills and expertise the college offers skills development programmes.

These are good examples of practices that are happening on the ground, often made possible by governmental policies and/or donor initiatives and funding. But revolutionising traditional education programmes requires not only strong partnerships but also national coordination.     

Turkey is one of the countries anticipating new skills and qualification requirements for industry 4.0. The Turkish Vocational Qualification Authority (VQA) initiated a mapping of professions related to industry 4.0 with the participation of relevant ministries, public authorities, professional and non-governmental organisations in April 2018. VQA signed cooperation protocols on preparation of National Occupational Standards and National Qualifications for new professions with the Industry and Technology Association (SANTEK) and the Information Technologies and Communication Authority (BTK). The first results of the cooperation are already visible. Eight new professions were defined, all at level 5 or 6 of the Turkish Qualifications Framework. New professions at level 5 are: Digital Industry Operator, Nanotechnology Application Operator Industrial Robotics Application Operator and Smart Agricultural Applications Operator. New professions at level 6 are: Penetration Test Expert, Harmful Software Analyst, Security Operations Center (SOC) Analyst and Digital Forensics Expert. National Occupational Standards and Qualifications for these professions are in various stages of development.  

Further reading:

•    International labour Office and International Organisation of Employers (2019). Changing business and opportunities for employers’ and business organizations, Geneva: ILO and IOE.

•    MACE (2017). Insights 2017. Moving to Industry 4.0: A skills revolution. New York: MACE.