Technology’s unrelenting advance is transforming work and the workplace. McKinsey Global Institute (MGI), using data from U.S. Bureau of Labor Statistics and the Occupational Information Network (O*Net), examined automation’s potential effect on the workplace by looking at over 2,000 activities comprising more than 800 occupations. MGI’s intriguing results tell an important story about the change that leaders must look for, manage and guide. MGI quantified the time spent on specific activities comprising a range of work and analyzed the feasibility of automating them. The automation potential of various types of work depends on technical feasibility, the availability of skills that automation may replace, cost to automate relative to human wages and considerations of social acceptance and regulation.
MGI found that fewer than 5% of jobs can be fully automated by employing current technology, but some automation can be incorporated into almost every job. Most automatable work involves data collection, data processing and physical labor, particularly in predictable, highly structured environments. These activities represent approximately $2.7 trillion in U.S. wages, and account for 51% of time spent working. Workers at all pay and skill levels are impacted; the disruption is not just in low-skilled work. Even in jobs where annual incomes exceed $200,000, 31% of time is involved in automatable tasks, usually data-related.
We all need to be more flexible and learn new skills as software, digital assistants and automation increasingly permeate more areas of daily work activities. In general, jobs will not automatically be automated, but work will continue to pair human endeavor with technology. There is an obvious effect on employment levels when even some parts of everyday work are automated. Many organizations will find the chief benefit of automation will not be from reduced labor costs but will be from the higher quality output and safety. Additionally, increases in productivity can provide more time for improved human interaction between employees and customers and other stakeholders. Furthermore, the need for skilled employees rises as the demand for unskilled work falls due to automation. Expertise is needed to manage and implement technology, and also to increase the skill level of the labor force through education.
These times of disruption in the workforce and rapid organizational change demand a high-performing culture that is committed to learning. The CEO and the C-suite team must understand the challenges and commit the resources needed to manage the change and development of the organizations’ people. They must create alignment within the organization on goals and direction, especially when the human elements are in flux.
Management and talent development capability are exceptionally difficult to automate (9% potential), and these are the skills required for a learning culture. What’s more, the individual employees themselves must commit to learning in order to comprehend and prepare for change that technology will bring to employees and work life. More than ever, the critical skills of decision-making, planning, creativity and innovation, which have low automation potential (18%), are needed. This learning, once incorporated into the DNA of the culture, increases employee engagement and proactively prepares the individual and the organization to effectively face the future.