Impact of New Technologies on the Labor Market: Past Lessons and New Challenges

Abstract

The article is devoted to the review of theoretical and applied studies on the impact of technological progress on the labor market and public policy. Firstly, the influence of previous industrial revolutions is considered. It is shown that new technologies during the last two centuries have been resulting in growth of employment and reduction of working hours. In addition, mass computerization observed in the past few decades has led to polarization of the labor market. Secondly, the concept of the Fourth Industrial Revolution is analyzed. It is pointed out that, despite active discussion of this topic in the mass media and in the expert community, so far the results of the former have been limited and the latest technologies related to it are poorly distributed even in the most developed countries. However, studies devoted to quantitative estimates of automation and labor substitution have a highly controversial methodology. As a result, the majority of alarmist predictions are deemed unfounded. Various studies have indicated that the more likely response to the new technological revolution is not an increase in unemployment, but rather a spread of non-standard employment. Finally, changes in government labor market policy due to technological innovations of recent years are investigated. Despite the persistent intentions to reform the fundamental labor market policies, European employment services continue to apply a standard set of practices. The data available for Russia indicate that the risks of automation and significant changes on the labor market are even lower than in developed countries.