{"id":2359,"date":"2023-01-20T08:09:00","date_gmt":"2023-01-20T08:09:00","guid":{"rendered":"https:\/\/rethinkq.adp.com\/?p=2359"},"modified":"2024-09-03T12:15:36","modified_gmt":"2024-09-03T11:15:36","slug":"debate-pay-gap-workers","status":"publish","type":"post","link":"https:\/\/rethinkq.adp.com\/debate-pay-gap-workers\/","title":{"rendered":"How will tech advances affect the skilled vs. unskilled pay gap?"},"content":{"rendered":"\n<header class=\"entry-header bg-adp-tan block--article-header alignfull block--article-header\" >\n\n  \n\n<figure class=\"wp-block-image size-full entry--image\"><img decoding=\"async\" width=\"1920\" height=\"1080\" src=\"https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2022\/12\/debate-1.jpg\" alt=\"Two groups of four people each have been spliced together; those on the left wear overalls and yellow hardhats, while those on the right are dressed in more office-ready attire. \" class=\"wp-image-2360\" srcset=\"https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2022\/12\/debate-1.jpg 1920w, https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2022\/12\/debate-1-300x169.jpg 300w, https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2022\/12\/debate-1-1024x576.jpg 1024w, https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2022\/12\/debate-1-768x432.jpg 768w, https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2022\/12\/debate-1-1536x864.jpg 1536w, https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2022\/12\/debate-1-1600x900.jpg 1600w\" sizes=\"(max-width: 1920px) 100vw, 1920px\" \/><\/figure>\n\n\n\n<div class=\"wp-block-group entry--title-wrapper\"><div class=\"wp-block-group__inner-container is-layout-flow wp-block-group-is-layout-flow\"><div class=\"entry--social-share\">\n  <ul>\n    <li><a href=\"https:\/\/www.facebook.com\/sharer\/sharer.php?u=https:\/\/rethinkq.adp.com\/debate-pay-gap-workers\/&#038;t=How will tech advances affect the skilled vs. unskilled pay gap?\" target=\"_blank\"><img decoding=\"async\" src=\"https:\/\/rethinkq.adp.com\/wp-content\/themes\/rethink-quarterly\/img\/facebook.svg\" alt=\"Facebook logo - click to share this article on Facebook\"><\/a><\/li>\n    <li><a href=\"http:\/\/twitter.com\/share?text=How will tech advances affect the skilled vs. unskilled pay gap?&#038;url=https:\/\/rethinkq.adp.com\/debate-pay-gap-workers\/\" target=\"_blank\"><img decoding=\"async\" src=\"https:\/\/rethinkq.adp.com\/wp-content\/themes\/rethink-quarterly\/img\/twitter.svg\" alt=\"Twitter logo - click to share this article on Twitter\"><\/a><\/li>\n    <li><a href=\"https:\/\/www.linkedin.com\/sharing\/share-offsite\/?url=https%3A%2F%2Frethinkq.adp.com%2Fdebate-pay-gap-workers%2F\" target=\"_blank\"><img decoding=\"async\" src=\"https:\/\/rethinkq.adp.com\/wp-content\/themes\/rethink-quarterly\/img\/linkedin.svg\" alt=\"LinkedIn logo - click to share this article on Facebook\"><\/a><\/li>\n  <\/ul>\n<\/div>\n\n          <span class=\"entry--tag tag-style\">Debate<\/span>\n    \n  <h1 class=\"entry-title\">How will tech advances affect the skilled vs. unskilled pay gap?<\/h1>\n\n\n<p class=\"is-style-summary-style\">Two experts debate the changing wage gap between skilled and unskilled workers.<\/p>\n<\/div><\/div>\n\n\n  <div class=\"entry--meta content-width\">\n           <p class=\"authors\">By\n                        <a href=\"https:\/\/rethinkq.adp.com\/author\/lou-martin\/\">Dr. Lou Martin<\/a>\n\n             \n          and                <a href=\"https:\/\/rethinkq.adp.com\/author\/dr-florian-lehmer\/\">Dr. Florian Lehmer<\/a>\n\n             \n         \n     <\/p>\n    \n  \n  <p>20 January 2023  <span class=\"desktop-only\">\u2014<\/span> <a href=\"https:\/\/rethinkq.adp.com\/issue-7-equality\/\">Issue 7: Equality<\/a> \n  <\/div><!-- .entry-meta -->\n\n<\/header><!-- .entry-header -->\n\t<div class=\"entry-content content-width\">\n\n\n\n<div class=\"wp-block-columns alignwide columns--debate is-layout-flex wp-container-core-columns-is-layout-9d6595d7 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<h2 class=\"wp-block-heading\">\u201cGovernments can choose to help close the pay gaps created by automation.\u201d<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">Dr. Lou Martin&nbsp;<\/h3>\n\n\n\n<h5 class=\"wp-block-heading\">Associate Professor of History at Chatham University, <strong>Pittsburgh, United States&nbsp;<\/strong><\/h5>\n\n\n\n<p>Recent advances in artificial intelligence and robotics have been stoking new fears about automation and the likely changes to the workplace. The term automation can lead one to imagine wonderful possibilities or nightmare scenarios.&nbsp;<\/p>\n\n\n\n<p>The term was popularized by the 1952 publication of John Diebold\u2019s \u201cAutomation: The Advent of the Automatic Factory.\u201d An early promoter of computers in industry, Diebold envisioned a revolution that would \u201ctake us beyond the civilization of an industrial society, a revolution in which human beings will be largely freed from the bondage of machines.\u201d<\/p>\n\n\n\n<p>That same year, Kurt Vonnegut\u2019s novel \u201cPlayer Piano\u201d imagined a world where engineers recorded the movements of workers and replaced them with machines. Then, the displaced workers were forced to live out their days in a dying town.<\/p>\n\n\n\n<p>While neither extreme scenario came to fruition, elements of both did. Industries embracing automation at that time included steel, coal and auto manufacturing. Just after World War II, when the U.S. Steel Corp. developed a more automated process to manufacture seamless pipes, managers decided to close an older plant about 40 miles outside of Pittsburgh, known as the Steel City. Yale social scientist Charles Walker studied its effects and predicted more shutdowns would come from technological innovation, which would then necessitate labor migration. \u201cThose effects,\u201d Walker wrote, \u201cshould be anticipated and reckoned with by responsible industrial, labor and government leaders.\u201d<\/p>\n\n\n\n<p>They weren\u2019t.<\/p>\n\n\n\n<p>In the 1950s, American coal companies \u2014 with the backing of the miners\u2019 union \u2014 began investing in machines that cut coal, loaded it, and transported it to the surface. Hundreds of thousands of mining jobs vanished with no discussions about the displaced workers. Over the next two decades, more than a million people left the coalfields, heading to cities like Detroit \u2014 the Motor City, home to General Motors, Chrysler and Ford.<\/p>\n\n\n\n<p>But Detroit was also in the process of shedding jobs to automation. Ford opened an Automation Department in 1947, which included installing mechanical arms for moving parts, automated welders and automated painting. Between 1947 and 1963, Detroit lost some 134,000 jobs even as migrants were arriving. During the 1960s, the chemical industry, commercial airlines and other growing sectors absorbed a lot of displaced workers, but that was more a case of fortunate timing than good planning.<\/p>\n\n\n\n<p>By that time, the coal, steel and auto industries of Europe were booming, and by the 1980s, countries like Brazil, Japan and China were entering those markets. Automation was one of several factors for the changes in the labor markets, but again shutdowns, mass layoffs and labor migrations soon followed.&nbsp;<\/p>\n\n\n\n<p>In the Ohio River Valley, steel companies went bankrupt. Displaced steelworkers lost half of their pension payments and, if they were under 65 years old, scrambled to get healthcare. Nations with robust welfare systems in western Europe were often able to soften the blow of mass layoffs with national healthcare and retirement plans. But even in state-driven economies, industrial workers have faced tough times. In northeastern China \u2014 the country\u2019s rustbelt \u2014 one miner <a href=\"https:\/\/www.npr.org\/sections\/parallels\/2017\/03\/14\/519621699\/as-chinas-coal-mines-close-miners-are-becoming-bolder-in-voicing-demands\" target=\"_blank\" rel=\"noreferrer noopener\">said<\/a> that they had been left behind \u201con the road to China&#8217;s prosperity.\u201d He added, \u201cIf they paid us our pensions and health insurance, we&#8217;d at least be able to survive.\u201d<\/p>\n\n\n\n<p>The coming innovations in automation will once again fundamentally change the nature of work and the labor market. Now is the time to start forecasting the effects, preparing the workers likely to be affected, and planning smoother transitions. With action, governments and industry leaders can choose to help close the gaps created by tech advances. There doesn\u2019t have to be a nightmare scenario.<\/p>\n\n\n<div class=\"block--author\">      <div class=\"block-author__inner\">\n        <div class=\"author--image\">\n                      <a href=\"https:\/\/rethinkq.adp.com\/author\/lou-martin\/\"><img decoding=\"async\" src=\"https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2021\/10\/profile_Martin-Lou-298x305.jpg\" alt=\"\" \/><\/a>\n                  <\/div>\n        <div class=\"author--info\">\n                      <a href=\"https:\/\/rethinkq.adp.com\/author\/lou-martin\/\" class=\"author--name\">Dr. Lou Martin<\/a>\n\n          \n          <p><span style=\"font-weight: 400;\">Dr. Lou Martin is an associate professor of history at Chatham University, a cofounder of the West Virginia Mine Wars Museum, and a member of the advisory council of the Ohio River Valley Institute<\/span><\/p>\n          <div class=\"block--author-social\"><ul class=\"author--socials\"><li><a href=\"https:\/\/www.chatham.edu\/academics\/undergraduate\/history\/faculty\/lou-martin.html\" title=\"Author Website\" target=\"_blank\"><i class=\"fas fa-globe\"><\/i><\/a><\/li><\/ul><\/div>\n        <\/div>\n      <\/div>\n       <\/div><\/div>\n\n\n\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<h2 class=\"wp-block-heading\">\u201cTech advances aren\u2019t going to close the skilled vs. unskilled pay gap.\u201d<\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">Dr. Florian Lehmer<\/h3>\n\n\n\n<h5 class=\"wp-block-heading\">Senior Researcher, Institute for Employment Research (IAB), <strong>Nuremberg, Germany<\/strong><\/h5>\n\n\n\n<p>According to our research, technological innovations in the workplace aren\u2019t necessarily closing the gap between qualified and unqualified workers. <\/p>\n\n\n\n<p>While service providers have been investing in new technologies during the pandemic, manufacturers haven\u2019t been as quick to do so. Service-oriented companies invested in technology that allowed employees to work and collaborate remotely, so service sector employees have benefited more from digitization than those working in production sectors. And even when production sectors have invested in these technologies, we\u2019ve observed that the positive wage impact is greater for those in service industries.&nbsp;<\/p>\n\n\n\n<p>Whether a worker will benefit from technological developments in the workplace strongly depends on what kind of work they\u2019re actually doing. Among those who benefit the most are employees in IT occupations. That\u2019s where we see that innovation and investments in technology are really complementary to the tasks these employees are already doing. <\/p>\n\n\n\n<p>When it comes to someone working in a job that\u2019s considered unskilled, then it gets a bit more difficult. If my job consists of carrying things in a warehouse and a robot could take over those tasks, then it really depends on what other tasks I\u2019m doing in my job. If I\u2019m doing skilled tasks, such as programming the robot or overseeing its supply routes, then this innovation can translate into higher wages. But if that\u2019s not what I\u2019m doing, then there\u2019s no reason for an employer to pay me. So we think that the income gap between skilled and unskilled workers will increase.<\/p>\n\n\n\n<p>So what does this mean for unskilled labor in the future? It depends on how far into the future we\u2019re trying to look. Right now, especially in Germany, we\u2019re seeing an acute shortage of unskilled workers, especially in areas such as the restaurant industry and the transportation sector. So right now there\u2019s still a high demand for these jobs. But as digitization and tech innovation in the workplace continue to advance, workers will be required to bring more specialized skills to the table. And that\u2019s why employment researchers consider lifelong learning and training to be essential.<\/p>\n\n\n\n<p>In our research, we prefer to focus more on the nature of the tasks that workers are performing, as opposed to the broad terms of \u201cskilled\u201d and \u201cunskilled\u201d labor. The key will be whether a worker\u2019s tasks are supported and made easier by tech innovations, leading to more productivity and higher wages, or if they are made obsolete, making it necessary for the worker to develop new skills. <\/p>\n\n\n\n<p>I think we\u2019re slowly moving away from a qualifications-based market, where your wages are determined by what kind of official training and degrees you have, and more towards a skill-based system. And that\u2019s why it\u2019s so important that constant learning is modeled and promoted throughout entire company structures, including from leadership positions.<\/p>\n\n\n\n<p>Traditionally, companies didn\u2019t really bother to provide training opportunities for low-skilled or unskilled workers to adapt to new tasks and technologies. Germany\u2019s apprenticeship system is rather interesting in this regard. The German labor market is shaped by the tradition of \u201cdual-learning,\u201d where apprentices are gaining technical skills in a work environment while simultaneously participating in schooling. <\/p>\n\n\n\n<p>The difference between what qualifies as \u201cskilled\u201d and \u201cunskilled\u201d labor in Germany is much wider than in other countries, but people are more likely to get the opportunity to continue developing. In order to ensure that as many workers as possible benefit from increased digitization, employers need to develop strategies to promote continuous skill-building among all levels.<\/p>\n\n\n<div class=\"block--author\">      <div class=\"block-author__inner\">\n        <div class=\"author--image\">\n                      <a href=\"https:\/\/rethinkq.adp.com\/author\/dr-florian-lehmer\/\"><img decoding=\"async\" src=\"https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2022\/12\/Florian_Lehmer-298x305.jpg\" alt=\"\" \/><\/a>\n                  <\/div>\n        <div class=\"author--info\">\n                      <a href=\"https:\/\/rethinkq.adp.com\/author\/dr-florian-lehmer\/\" class=\"author--name\">Dr. Florian Lehmer<\/a>\n\n          \n          <p><span style=\"font-weight: 400;\">Dr. Florian Lehmer is a research fellow in the <\/span><a href=\"https:\/\/iab.de\/bereich\/?id=52000\"><span style=\"font-weight: 400;\">Occupations in Transition<\/span><\/a><span style=\"font-weight: 400;\"> research group at Germany\u2019s <\/span><a href=\"https:\/\/iab.de\/en\/startseite-english\/\"><span style=\"font-weight: 400;\">Institute for Employment Research<\/span><\/a><span style=\"font-weight: 400;\">. His research interests lie in empirical labor market economics and applied microeconometrics. Currently, he is primarily focused on the effects of digital and ecological transformations on the labor market. <\/span><\/p>\n          <div class=\"block--author-social\"><ul class=\"author--socials\"><\/ul><\/div>\n        <\/div>\n      <\/div>\n       <\/div><\/div>\n<\/div>\n\n\n<div class=\"block--recommended-content alignwide is-style-bg-adp-tan\"><div class=\"block-recommended-content__inner\">\n\n<h2 class=\"wp-block-heading\">Read more<\/h2>\n\n\n<div class=\"block--article-pushpoint pushpoint__small\">      <div class=\"block-article-pushpoint__inner\">\n        <a href=\"https:\/\/rethinkq.adp.com\/pandemic-pay-challenges\/\">\n        <div class=\"pushpoint--image\">\n          <img decoding=\"async\" src=\"https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2021\/10\/2BN3DCC-1-1084x576.jpg\" alt=\"\" \/>\n        <\/div>\n        <div class=\"pushpoint--info\">\n                    <span class=\"pushpoint--title\">How companies and workers are reacting to pandemic pay challenges<\/span>\n          <p>Many employees have experienced changes to their jobs and pay due to the pandemic, and the results have not always been positive.<\/p>        <\/div>\n      <\/a><\/div> <\/div>\n\n<div class=\"block--article-pushpoint pushpoint__small\">      <div class=\"block-article-pushpoint__inner\">\n        <a href=\"https:\/\/rethinkq.adp.com\/debate-rightful-home-payroll\/\">\n        <div class=\"pushpoint--image\">\n          <img decoding=\"async\" src=\"https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2024\/02\/business-people-reading-whiteboard-in-office-DRCG9B-1084x576.jpg\" alt=\"\" \/>\n        <\/div>\n        <div class=\"pushpoint--info\">\n                    <span class=\"pushpoint--title\">Does payroll belong in finance or HR?<\/span>\n          <p>Three experts sound off on the rightful place of payroll within an organization.<\/p>        <\/div>\n      <\/a><\/div> <\/div>\n\n<div class=\"block--article-pushpoint pushpoint__small\">      <div class=\"block-article-pushpoint__inner\">\n        <a href=\"https:\/\/rethinkq.adp.com\/history-minimum-wage\/\">\n        <div class=\"pushpoint--image\">\n          <img decoding=\"async\" src=\"https:\/\/rethinkq.adp.com\/wp-content\/uploads\/2022\/01\/puerto-rico-fsa-8c08000-8c08300-8c08344u-1084x576.jpg\" alt=\"\" \/>\n        <\/div>\n        <div class=\"pushpoint--info\">\n                    <span class=\"pushpoint--title\">The long evolution of minimum wage<\/span>\n          <p>Real-life experiments show that increasing minimum wages doesn\u2019t affect employment rates, but does help relieve poverty. <\/p>        <\/div>\n      <\/a><\/div> <\/div>\n<\/div><\/div>\n\n\n<section class=\"wp-block-group alignfull section--sign-up has-background\" style=\"background-color:#7967ae\"><div class=\"wp-block-group__inner-container is-layout-flow wp-block-group-is-layout-flow\">\n<p class=\"has-text-align-center is-style-default has-white-color has-text-color has-large-font-size\"><a href=\"\/sign-up\/\">Sign up<\/a> to keep up to date with ReThink Q.<\/p>\n<\/div><\/section>\n","protected":false},"excerpt":{"rendered":"<p>Two experts debate the changing wage gap between skilled and unskilled workers.<\/p>\n","protected":false},"author":1,"featured_media":2360,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":true,"footnotes":""},"categories":[285],"tags":[297,271,296,44,291],"coauthors":[118,286],"class_list":["post-2359","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-debate","tag-debate","tag-labor","tag-opinion","tag-payroll","tag-wage-gap","issue-issue-7-equality"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>How will tech advances affect the skilled vs. unskilled pay gap? 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