Why service industry workers should embrace, not fear, the AI-driven digital revolution

Name: Santa Claus works from home to greet children in virtual meetings during pandemic
Uploaded: 2020-12-23T14:00:19.000Z
Duration: 2 min 35 s
Description: Santa Claus works from home to greet children in virtual meetings during pandemic

While digital technology is driving job displacement, human ingenuity is driving job creation. But new jobs may not appear as fast as old ones disappear

Workers will be safe if they are flexible, machines cannot gather a large data set about their role, or they have jobs that cannot be done remotely

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A man tries out a Chinese traditional medicine treatment using robotic arms at the China International Fair for Trade in Services in Beijing on September 6. AI-driven automation will transform almost every service job in some way, but they will replace very few because there’s always something that “globotics” can’t do. Photo: AFP

Richard Baldwin

Published: 10:00pm, 23 Dec 2020Updated: 3:55am, 24 Dec 2020

Covid-19 has forced a massive “emergency” digital transformation on us. The consequences of this might be a surprise to some but, to me, the pandemic simply accelerated an ongoing trend. In my 2019 book, The Globotics Upheaval: Globalisation, Robotics and the Future of Work, I envisioned a new form of globalisation in “telemigration”. This is basically working from home when home is abroad.

The future of globalisation is no longer just about trading goods across borders. An important element of it will involve the arbitrage of services. In addition to the acceleration that has come from so many people shifting to online work, the social distancing and other public health measures brought in to combat the virus have done a similar thing.

By making it difficult for us to work or even see other people in person, they have raised the cost of hiring in-person workers versus online workers. During this difficult time, I’m sure most of you have experienced remote working. Did it ever occur to you that, if you can do your job from your home in Hong Kong, what is stopping someone with the same skill set but much cheaper salary doing the same job from, say, Mumbai?

The answer is there is nothing stopping this imagined scenario from happening and this is likely to happen soon. The wage gap between workers in different countries is what makes telemigration profitable, and digital technology is making it possible. Digital technology is tearing down country barriers for services.

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Santa Claus works from home to greet children in virtual meetings during pandemic

You might think it is not the first time that businesses have offshored jobs to places with cheaper labour. For example, US companies are known to outsource call centre jobs to India.