Thursday 17 December 2015

If middle-skilled workers are replaced, what could happen?


Research from the McKinsey Global Institute find that digitisation could add $2.2tn to the US GDP by 2025 as companies lift productivity by exploiting advanced technologies. Meanwhile 10 to 15 percent of the middle skilled workers will be replaced by the advanced technologies. These people are considered to the Middle Classes, who have relatively stable incomes. Once firms choose productivity rather than "social responsibility", many of these Middle Classes would become unemployed. The labour market would become more and more competitive and the wage will decrease further as the labours have to make themselves cheaper in order to compete with machines. This could widen the gap between the rich and the poor. The population could decrease, as parents are harder to provide sufficient incomes to support a larger family. Therefore, with technology development, there could be a decrease in the population, as only people with skills that cannot be replaced by machines can become richer.

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