Minimum income schemes needed for job loss due to automation: Study

Certain sectors are expected to experience shrinkage of employment demand as robotic systems and algorithms take up several tasks

GN Bureau | May 2, 2017


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With the Indian IT and other industries facing daunting challenges from protectionism in the US and Artificial Intelligence (AI), an ASSOCHAM-PwC study has made out a case for government –industry schemes that ensure a minimum income to those displaced , along with basic health facilities for the families in stress.

It said there are concerns in a number of industries related to loss of jobs, arising out AI and robotics and the solution lies in facing the issue upfront and skilling up the country's human resource.

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“In light of technology advances, certain sectors are expected to experience shrinkage of employment demand as robotic systems and algorithms take up several tasks. It can be expected that IT, manufacturing, agriculture etc will experience such a demand shift,” the study noted.

Quoting Oxford University researchers Carl Frety and Michael Osborne, based on 702 occupational groupings, workers in tele-marketing, hand sewers, mathematical technicians, insurance underwriters, watch repairers, cargo agents, tax preparers have a very high probability of being replaced by automation.

The ASSOCHAM-PwC Paper suggested that even though the churn arising out of automation would throw new opportunities, certain basic cushion must be given to those who may get affected by the AI and robotics and other automation technologies.

The paper made a strong case for universal benefits outside employment structures. “If a large number of people end up unemployed for extended periods of time, there needs to be a way to provide healthcare, disability and pension benefits outside employment.”

It also sought a minimum income to sustain households. “In the event of continuous unemployment or under-employment, government schemes to provide a minimum level of income to each citizen to guarantee basic needs are necessary to keep them out of destitution. Proposals must be structured in a way so as to maintain a balance between benefits and incentives for engagement – for example by involving the unemployed in social and community initiatives”.

The ASSOCHAM–PwC Paper sought creation of separate funds by the companies for skill re-training of employees. “Companies can contribute a set amount to an individual's fund which can then be transferred as the individual switches jobs.  The goal of such an initiative will be o incentivize lifelong education and up-skilling."

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