Work in a Changing Economy

Introduction from the Just Transition Fund: 
Across the U.S., market forces are contributing to an energy transition away from coal, leaving coal-dependent regions devastated. Coal plant and mine closures are eroding the tax base and causing significant direct and indirect job loss. Former coal workers are faced with the challenge of finding new jobs that often require new skill sets. The Fund supports a myriad of innovative job creation solutions and is excited to bring awareness to important future of work trends and the research conducted by the Aspen Institute Future of Work Initiative. Through sharing this work with the transition community, we hope to emphasize the impact of these trends in rural communities, and will continue to support workforce development training that ensures workers are prepared with relevant training for the jobs of a changing economy.

What will the future of work look like? This question is being asked today in classrooms, in corporate boardrooms, at the dinner table, and in the halls of state capitols. And it’s an especially important question for those who are designing and running programs to support workers and expand opportunity in communities experiencing economic transition.

Several important trends are impacting workers and businesses today, and could bring dramatic transformations in the years ahead. This blog post will explore two of the key trends that drive the work of the Aspen Institute Future of Work Initiative, a nonpartisan effort focused on developing policy solutions to address the challenges facing American workers and businesses due to the changing nature of work in the 21st century. 

The nature of work is changing. Technology has a long history of changing how we work. Our country has transitioned from an agricultural to industrial economy, and more recently to a primarily knowledge and service-based economy. Today, this change continues as emerging technologies like artificial intelligence, machine learning, and advanced robotics have the potential to automate many tasks currently performed by workers. These changes are leading to renewed questions about what the future holds for American workers. The impacts could be significant. A recent McKinsey study estimated that up to 33 percent of workers may need to transition to entirely different occupations by 2030. Recent analysis by the Brookings Institution found that smaller, more rural communities seem significantly more exposed to the automation of current workplace activities than larger communities. The communities that were hit hardest by previous waves of automation and economic disruption also stand to be the most impacted once more. Further, given the automation potential among work activities in the mining industry, the Brookings analysis also noted that when looking at county-level data, rural counties with large mining operations have the potential to be major sites of disruption. The most vulnerable jobs are characterized by repetitive, predictable activities – like operating machinery, preparing fast food, or collecting and processing data. Whether jobs are eliminated or change, workers will need to retrain. Importantly, retraining must be relevant to in-demand fields.  

While technological change presents challenges, it also offers opportunities to improve the quality of work and create new job opportunities. Historically, automation’s overall impact on the economy has led to more growth, more jobs, and higher living standards. But the impact of automation is determined by how we as a society choose to respond—mediated by our policies and institutions. To help workers take advantage of the new jobs that automation will create and manage transitions back to stable work if they lose their job, we must modernize our systems and institutions to reflect the realities of a rapidly evolving economy.

"While technological change presents challenges, it also offers opportunities to improve the quality of work and create new job opportunities."

The Future of Work Initiative recently released a report, Automation and a Changing Economy, that explores how automation impacts the economic security and opportunity of workers, and proposes a set of policy solutions to better prepare the workforce for the opportunities and challenges that automation will bring. While these challenges are national in nature, many creative solutions are being developed locally by non-profit organizations and innovative cities and states. Among the solutions are ideas to help people and communities recover from job loss, including strengthening supports for displaced workers through retraining, job search, career coaching, and a modernized unemployment insurance system to help workers transition to new jobs and careers. 

But it’s not just what we’re doing for work that is changing - it’s how we’re doing it. The structure of work is changing. The latest data from the U.S. Bureau of Labor Statistics showed that 1 in 10 American workers, or about 15 million people, participate in what the government calls alternative or non-traditional work arrangements. This includes jobs such as freelance graphic designers or independent carpenters and plumbers. And at least as many workers engage in these types of work as a supplemental income source. While independent work can provide flexibility, it can also increase the economic insecurity that these workers face. As workplace benefits and protections are often provided through an employer, those who lack a traditional employer are often left to cobble together their own safety net. As the economy has transformed, we need a new way of providing economic security and mobility through work that equips workers to thrive today and into the future. For example, as a complement to the employer-provided benefits system, portable benefits models can help provide benefits to more workers, and allow workers to move from job to job without the fear of losing access to benefits. 

It’s important for us to better understand how these trends are impacting our economy, as well as to explore, test and expand solutions. Continued dialogue and action on these issues, especially among policymakers, is needed to support an economy that works better for all Americans. In meeting both the opportunities and challenges of an evolving 21st century economy, we can look to communities working to address industry transitions and ideas that are being tested and proven locally as sources of innovation and inspiration.