Jon Erik Dølvik: Technology easily blinds us, yet we can shape our own future of work

Dølvik heads the largest research project ever financed by the Nordic Council of Ministers for Labour. 30 researchers from the Norwegian research foundation Fafo and seven Nordic universities are gathering knowledge and giving advice on how the Nordic region should face the challenges linked to the future of work. 

“In our first report this autumn we will look at what are the driving forces. What actually has an influence?

“After that we will analyse different perspectives, like automation, before we finally sum up the changes and discuss the need for adapting the Nordic model to the new reality.”

It is early days, but Jon Erik Dølvik is quite determined when it comes to the kind of report this will not become.

“We will not seek to frighten politicians with worst-case-scenarios, like half of all jobs will disappear because of digitalisation. It is important not to get blinded by what the latest technology can lead to on a micro scale in individual companies. The effects on employment and working conditions in general also depend on different issues besides technology.

“The way in which we are influenced by new technology will always be filtered through markets, institutions and how people act. We are not helpless in the face of technological change, we can make decisions through our economic, political and social institutions,” he says.

Many driving forces

When he illustrates the many driving forces which might have an impact on the Nordic model in terms of how the labour market is organised, digitalisation is but one out of many factors. 

“Tomorrow’s labour market will probably be influenced just as much by demographic change linked to an ageing population and migration, which again is influenced by globalisation, urbanisation, climate change, developments within the EU and changes to our values, norms and ideas,” he says.

“These driving forces rarely pull in the same direction or in the same way in different countries. Globalisation and the EU’s role can both increase and decrease for instance. But a common trend over the past decades is that inequalities have grown – and in the Nordic region more than anywhere else.”

The last of the driving forces which Dølvik presents is what is called ‘financialization’

“This is about how the finance sector is expanding, and the increase is in investments in stocks, property and other assets, rather than in production which creates new jobs. This is amplified by digitalisation which has created companies where production costs for making yet another product or service become negligible, so-called declining marginal costs.”

When a robot has learnt a task, the knowledge can immediately be copied to other robots. When we watch a film, listen to music or read books, providing a different customer with the same goods is nearly cost-free for the company and demands next to no labour.

This kind of ‘winner takes all’ activity means the largest companies like Amazon, Google and Facebook amass enormous returns, while they pay next to nothing in taxes to host countries, and only invest a small portion of their returns in new production and new staff. 

How are profits divided?

“The key question if we want to further develop our Nordic welfare states, is how the profits are divided. Do we manage to keep the profits that are created in our countries and invest these in businesses that create jobs, or do they disappear to owners abroad? There is no lack of unsolved issues, but if the global company giants keep taking an increasingly large slice of the cake, we might experience lack of demand for labour.  

“The social partners and governments need to find the right balance, so that we can improve the conditions for life-long learning, occupational mobility and invest enough in skills and competencies. That’s when we can use technology to increase productivity, and also deal with the increasing demands within the health and care sector, education and infrastructure,” says Jon Erik Dølvik.

These are the streams in society which might remind us of the Gulf Stream, where the actual pump is cold water sinking down in the Arctic, creating pressure pushing warm water from the southern hemisphere up through the Atlantic. In the same way climate scientists worry about increasing temperatures’ potential for changing the Gulf Stream, the capital streams might also change. 

In some countries with large raw material deposits, like several oil producing countries, this is not functioning. Ordinary citizens never get to share the wealth and there can never be economic development. Countries which have pumped up oil for hundreds of billions of dollars are poorer than neighbouring countries which have not found oil, and as a result have had to invest in different and more labour-intensive trades than oil.

Productive justice

Who says the Nordic countries cannot be the ones benefiting the most from the changes which are now taking place in the labour market?

“We have special institutional features which have contributed to a kind of ‘productive justice’. Gains created have been divided and to a large extent benefited citizens who in turn can ask for new goods and services.

“This does not mean there are no threats to the Nordic model, because these special features are under pressure. New ways of organising work, for instance in the platform economy, where short-term working tasks are run by algorithms, means union membership numbers will probably fall. It is also worth noting that the technological development has a greater impact on routine working tasks found in the middle of the occupational pyramid, where trade unions and collective agreements are strongest.

“But the future of work is something we have a chance to shape ourselves. If we focus enough on life-long learning and make sure the institutions we have in the Nordic model are innovative and adaptable enough, we can also handle unexpected change,” says Jon Erik Dølvik, and reminds us that the Nordic region, despite pessimistic predictions, is one of the regions which have gained the most from globalisation. 

Comprehensive research project

The research project on the Nordic model has been structured around four themes:

• Which are the drivers that influence the labour market?
• Digitalisation and automation
• Atypical forms of employment
• New actors, like platform-based companies

 The researchers will also be looking at three overarching issues:

• How working environments develop, across different trades
• How labour law develops
• How the Nordic model is influenced 

Jon Erik Dølvik says the aim of the research, which ends in 2020, is not primarily to provide specific political advice, but rather give the politicians and social partners an idea of which elements can be influenced. 

“As always, the best advice is to prepare the ground for life-long learning. The main challenge is whether we in the Nordic region manage to maintain a political economy where surplus and value creation is channelled into investments in new growth industries,” he sums up.