A View from India
Urvashi Aneja ponders what a new machine age will mean for India’s 1.3 billion citizens. Will it fast track social mobility, or rather exacerbate the informal economy and lock in existing class and caste divides?
By Urvashi Aneja
Most conversations about the impact of emerging technologies, or the fourth industrial revolution, are dominated by the encounters, trajectories and needs of industrialised economies. But, in many parts of the world, earlier industrial revolutions are still unfolding, millions of people continue to lack access to basic services, and formal employment remains aspirational for most. Technology is a social product, patterned by the conditions of its creation and use. Technology trajectories and their impact will thus differ across social contexts and groups. Global narratives need to be localised and re-examined, otherwise there is a risk that dominant techno-imaginaries will remain misaligned with the needs of a bulk of the world’s population.
Here I want to talk about what the future of work will look like in India. Fewer than 2 million jobs are being created annually, even while the number of people joining the workforce exceeds 8 million every year. Women’s participation in the labour force is also declining. At 27 percent, it is the second lowest in South Asia and lowest among the BRIC countries. Over 80 percent of the population are engaged in the informal economy, and even within the organised sectors of the economy, over 70 percent work without a contract. Approximately 300 million Indians live without electricity and less than 40 per cent of the population has access to the internet. Securing decent work is an urgent and pressing priority, even without factoring in the impact of technological disruption.
The future world of work in India is likely to be characterised by three features:
First, the number of good jobs is likely to decrease, restricting socio-economic mobility. Despite high rates of GDP growth, ‘bad’ jobs continue to outnumber ‘good’ jobs. The bulk of India’s labour force is engaged in the informal economy, where employment is characterised by low wages, limited security, poor conditions, and an absence of formal protections. Most people work as daily wage, manual labour in the agriculture and construction sectors. A ‘desk job’ or a ‘white collar’ job in the formal sectors of the economy should be an escape route. Yet these jobs are scarce and becoming scarcer, with less than 2 million created in the previous year. Technology is part of the problem, with automation observable across several sectors, from chat bots that substitute for call centre workers to software that makes basic data entry roles redundant. Airports like the one in Bangalore today boast of self check-in kiosks and ‘smart’ baggage drop off desks. Car manufacturers Honda and Suzuki now employ over 4000 robots in their Indian factories.
The automation of entry level positions is likely to restrict opportunities for upward socioeconomic mobility for millions of Indians, leaving the fissures of formal-informal, urban-rural, caste and class in place. Moreover, the manufacturing led route to prosperity may no longer be available to India as the availability of advanced automation technologies ushers in premature de-industrialisation. A recent study estimates that 69 percent of jobs within the manufacturing sector are automatable. While the future adoption of these technologies will depend on the relative cost of labour — currently workers are substantially cheaper than deploying robots — giving a leg up to India’s unskilled or low skilled labour is becoming increasingly difficult.
Second, informality will be an enduring, if not accelerating, condition of Indian labour markets.
The growth of the platform economy in India is likely to create new micro entrepreneurial opportunities for workers. Yet gig work is not a new phenomenon for India. Most workers already work multiple jobs, with multiple employers, on a piece-rate basis, and without access to any formal protections. Digital platforms are shifting many types of informal work, from plumbers to drivers, to the formal sectors of the economy. But for workers, the formalisation is only partial. Income insecurity persists and the social security benefits associated with formal employment
remain elusive. The platform economy is thus likely to reproduce if not expand precarious conditions of work.
Left to fend for themselves, some workers have clubbed together to offer mutual support. In Bangalore, many drivers have left Uber to join a WhatsApp group that directly connects them with customers and other drivers. Drivers have also created a common chit-fund, a type of credit association, as a means of safeguarding against sickness and other shocks. But membership to this group is restricted to drivers that already know each other. Migrant workers that have recently moved to Bangalore, lured by the promise of high earnings on cab hailing services, have limited access to such informal avenues for social protection. Not all workers will have the social capital necessary to weather uncertainty.
The digital economy will no doubt create opportunities for Indian workers. Platforms, for example, make it easier for companies overseas to break down work into smaller tasks, many of which are then completed by Indian workers. We are home to the second largest market of freelance professionals in the world, making up around 40 percent of all freelance jobs offered worldwide. Many of these workers provide software and technology related services to wealthy clients in Western economies. However, a growing number of low to medium skilled workers are also engaged in less glamorous micro work, including the remote completion of small information processing tasks like image recognition and data annotation. On Amazon Mechanical Turk, the world’s largest micro work platform, Indian workers comprise the second largest group, at 18 percent. In both cases, an oversupply of labour is likely to mean a race to the bottom in wages and employment conditions.
Third, socio-economic inequality is likely to deepen. India is already one of the most unequal countries in the world and labour’s share of national income is in decline. Only those with the requisite skills will be able to leverage new opportunities, and these people are in the minority. For women, and other marginalised social groups, low levels of education and skilling combined with prevailing sociocultural norms are likely to limit their capacity to capitalise on new opportunities in a digital economy. Over 20 percent of girls drop out of school before they reach puberty, primarily because they are required for domestic chores. Family pressures are also cited as one of the main reasons why women quit their jobs. Women are also more likely to occupy low to medium skill level jobs that are most vulnerable to the effects of automation. In the IT and Business Process Outsourcing (BPO) sector, for example, women tend to occupy low skill, backend jobs, which are likely to be automated first in terms of technical feasibility. Managerial, high skilled, positions, that are less susceptible to automation, are typically occupied by men. The platform economy could give women greater access to flexible work, but this also risks reproducing the gendered division of labour.
Technology is not just removing jobs, it is also changing who has access to them. Predictive analytics and artificial intelligence (AI) technologies are now commonly applied to facilitate hiring and firing practices. By judging people on their performance and qualifications only, AI could in theory root out bias that is inherent in every workplace, a pressing problem in India due to its caste, class and religious divisions. Yet emerging evidence suggests that automated systems tend to reproduce discrimination, either because of programmer bias or because of unrepresentative data sets. Workplace surveillance, too, could be a serious problem in India, particularly where job competition is high, labour rights are poorly understood, and conversations about data privacy are at a nascent stage.
Of course, the future world of work need not be so bleak. Technological innovation will bring tremendous productivity gains to some sectors of the economy and specific social groups. India boasts numerous success stories, of entrepreneurs, start-ups, and industries that are globally competitive. But, to ensure prosperity isn’t confined to the lucky few, India will need to address its policy failings, on education and skilling, healthcare, infrastructure and gender justice. Public spending on education, for example, is currently only 3.8 percent of GDP, lower than other emerging economies like Brazil and Malaysia.
Indian will also require new forms of social protection that address the perils of informal work. Platforms, for example, could be mandated to deliver income protection insurance and fair terms of employment. Redistributive strategies will also be needed, such as unemployment insurance for those laid off due to automation, possibly paid for through higher taxation on technology companies. Finally, investment in technology should be directed toward developing innovations for those at the bottom of the pyramid. This could mean prioritising the automation of jobs considered ‘dirty, dangerous, or demeaning’, such as manual scavenging, which claimed over 300 lives in the past year.
We urgently need to rethink our approach to innovation, reimagining not just how to achieve productivity gains through technology, but also how to distribute those gains across society. With the livelihoods of 1.3 billion people at stake, there is no time to lose.
This article originally appeared in the following RSA report (Dec 2018): A field guide to the future of work
