By Katabella Roberts
The World Economic Forum (WEF) has warned that the employment landscape will change drastically over the next five years amid increasingly widespread use of artificial intelligence (AI), the transition to green energy, environmental, social, and governance (ESG) standards, and slower economic growth.
According to WEF’s “The Future of Jobs Report 2023,” roughly 23 percent of jobs are expected to change by 2027, with around 69 million new jobs to be created and 83 million eliminated, resulting in a decrease of 14 million jobs, or 2 percent of current employment.
The report (pdf) surveyed 803 companies collectively employing more than 11.3 million workers in 27 industry clusters and 45 economies from across the globe, on macro and technology trends and their impact on jobs and skills, as well as the “workforce transformation strategies” that businesses plan to implement between now and 2027.
It found that clerical or secretarial roles, including bank tellers, cashiers and ticket clerks, data entry clerks, postal service clerks, and administrative and executive secretaries will likely see the fastest decline in roles over the next five years relative to their size today, with roughly 26 million fewer jobs by 2027.
Meanwhile, certain tech jobs, including those focused on AI and machine learning, sustainability specialists, business intelligence analysts, information security specialists, and fintech engineers, are expected to see an increase in employment.
Overall, the biggest job growth will likely be seen across the fields of education (10 percent, leading to 3 million additional jobs), agriculture (30 percent, or 3 million additional jobs), and digital commerce and trade (4 million additional jobs), according to the report.
Renewable Energy, ESG Pushing Job Changes
The WEF cites trends such as the transition to renewable energy, ESG standards—which are used by companies in the investment decision-making process to measure sustainable and ethical impacts—advancing technology adoption, and localization of supply chains as the “leading drivers of job growth,” while economic challenges such as ongoing high inflation, slower economic growth, and supply shortages pose “the greatest threat” to job creation.
“The largest job creation and destruction effects come from environmental, technology, and economic trends. Among the macro trends listed, businesses predict the strongest net job-creation effect to be driven by investments that facilitate the green transition of businesses, the broader application of ESG standards, and supply chains becoming more localized, albeit with job growth offset by partial job displacement in each case,” the report states.
U.S. Republican lawmakers have repeatedly warned that companies embracing ESG standards risk slashing investment returns and hampering economic growth, which could have ripple effects across the economy.
“Climate change adaptation and the demographic dividend in developing and emerging economies also rate high as net job creators,” the WEF report adds. “Technological advancement through increased adoption of new and frontier technologies and increased digital access are expected to drive job growth in more than half of surveyed companies, offset by expected job displacement in one-fifth of companies,” it continues.
The report also cites the increasing cost of living for consumers as another factor that will likely pose the greatest threat to the job market in the next five years and will significantly displace jobs.
Firms ‘Need to Be Ready for the Disruptions Ahead’
Elsewhere, the WEF found that the ongoing impact of the COVID-19 pandemic, increased geopolitical divisions, and demographic dividends in developing and emerging economies ranked lower as drivers of business evolution by respondents.
The latest report comes shortly after Goldman Sachs economists forecast two-thirds of occupations across America could be partially automated by AI, which has exploded in use in recent years, despite concerns over its potential risks to society and humanity.
However, economists also noted that its use in both business and society could lead to an almost $7 trillion increase in global GDP owing to increased productivity and manufacturing, among other factors.
According to the WEF report, nearly 75 percent of companies surveyed plan to adopt AI, big data, and cloud computing within the next five years, which around 50 percent of firms believe will create job growth and 25 percent expect will lead to job losses.
Elsewhere, the report found that organizations estimate roughly 34 percent of all business-related tasks are currently performed by machines, with the remaining 66 percent performed by humans.
“The latest findings in the Future of Jobs Report renew calls for action from all labor market stakeholders,” said Sander van ‘t Noordende, CEO of the human resource consulting firm, Randstad.
“Acceleration in digitalization, AI, and automation are creating tremendous opportunities for the global workforce, but employers, governments, and other organizations need to be ready for the disruptions ahead. By collectively offering greater skilling resources, more efficiently connecting talent to jobs, and advocating for a well-regulated labor market, we can protect and prepare workers for a more specialized and equitable future of work,” he added.