The future of women at work: Transitions in the age of automation

 

Here is an excerpt from an article Written by Anu Madgavkar, James Manyika, Mekala Krishnan, Kweilin Ellingrud, Lareina Yee, Jonathan Woetzel, Michael Chui, Vivian Hunt, and Sruti Balakrishnan for the McKinsey Quarterly, published by McKinsey & Company. To read the complete article, check out others, learn more about the firm, and sign up for email alerts, please click here.

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Concerted and creative new solutions are needed to enable women to seize new opportunities in the automation age; without them, women may fall further behind in the world of work.

The age of automation, and on the near horizon, artificial intelligence (AI) technologies offer new job opportunities and avenues for economic advancement, but women face new challenges overlaid on long-established ones. Between 40 million and 160 million women globally may need to transition between occupations by 2030, often into higher-skilled roles. To weather this disruption, women (and men) need to be skilled, mobile, and tech-savvy, but women face pervasive barriers on each, and will need targeted support to move forward in the world of work.

A new McKinsey Global Institute (MGI) report, The future of women at work: Transitions in the age of automation (PDF–2MB), finds that if women make these transitions, they could be on the path to more productive, better-paid work. If they cannot, they could face a growing wage gap or be left further behind when progress toward gender parity in work is already slow.

Women and men face a similar scale of potential job losses and gains, but in different areas. To adapt to the new world of work, they will need to be skilled, mobile, and tech savvy.
This new research explores potential patterns in “jobs lost” (jobs displaced by automation), “jobs gained” (job creation driven by economic growth, investment, demographic changes, and technological innovation), and “jobs changed” (jobs whose activities and skill requirements change from partial automation) for women by exploring several scenarios of how automation adoption and job creation trends could play out by 2030 for men and women given current gender patterns in the global workforce.These scenarios are not meant to predict the future; rather, they serve as a tool to understand a range of possible outcomes and identify interventions needed. We use the term jobs as shorthand for full-time-equivalent workers.The research examines six mature economies (Canada, France, Germany, Japan, the United Kingdom, and the United States) and four emerging economies (China, India, Mexico, and South Africa), which together account for around half of the world’s population and about 60 percent of global GDP.

TABLE OF CONTENTS

    1. Women and men face a similar scale of potential job losses and gains, but in different areas
    2. Women’s jobs may be more prone to partial automation than being entirely displaced by automation
    3. Between 40 million and 160 million women globally may need to transition between occupations
    4. Women will need to be skilled, mobile, and tech savvy to adapt to the new world of work
Men and women tend to cluster in different occupations in both mature and emerging economies, and this shapes the jobs lost and gained due to automation for each. In the mature economies studied, women account for 15 percent on average of machine operators, but over 70 percent on average of clerical support workers. In the emerging economies in our sample, women make up less than 25 percent of machine operators on average, but over 40 percent of clerical support workers. Over 70 percent of workers in healthcare and social assistance in nine of the ten countries (the exception is India) are women. However, less than 15 percent of construction workers, and only around 30 percent of manufacturing workers, are female in many countries.If a scenario of automation unfolds on the scale of past technological disruptions, women and men could face job losses and gains of a broadly similar magnitude.
In this research, we explore various sceno 2030 developed using MGI’s past future of work research, and its analysis of jobs lost and gained. Our current research breaks new ground by adding a gender lens to that work, and by looking at a broad range of effects on women’s jobs including potential job displacement, opportunities for job creation, the changing nature of jobs, and a quantitative assessment of the transitions that women will need to make to capture these new opportunities, including implications for wages and average education levels. Our main scenario to 2030 is based on a “midpoint” scenario of automation adoption, which models automation at a similar scale to that of other major technological disruptions in the past.In the case of jobs lost, women may be only slightly less at risk than men of their job being displaced by automation. In the ten countries, an average of 20 percent of women working today, or 107 million women, could find their jobs displaced by automation, compared with men at 21 percent (163 million) in the period to 2030 (Exhibit 1).
The composition of job displacements could be different for men and women, largely reflecting differences in the mix of occupations in which they tend to work, and the activities that make up those occupations. Some activities, and therefore occupations, are more automatable than others. For instance, both routine physical tasks and routine cognitive work are highly automatable, but those requiring more complex cognitive, and social and emotional skills are less so. Men predominate in physical roles such as machine operators and craftworkers; therefore, nearly 40 percent of jobs held by men that could be displaced by automation in our 2030 scenario are in these categories. Conversely, women predominate in many occupations with high automation potential due to routine cognitive work, such as clerical support or service worker roles; these occupations account for 52 percent of potential female job displacements.

The composition of job displacements could vary for men and women, largely reflecting differences in the occupations in which they tend to work.

There are differences among countries, too. In mature economies, men may tend to lose machine operator jobs while women could tend to lose clerical and service worker jobs. In emerging economies there is a visible trend of jobs being displaced in agriculture-related occupations in our scenario, even here, however, patterns vary among emerging economies. For instance, agricultural work is one of three top occupational groups driving job displacements for men (21 percent of losses) in Mexico but is not in the top three for women. However, in India where so many women work in subsistence agriculture, losses in this occupational category could account for 28 percent of jobs lost by women, compared with 16 percent of jobs lost by men.

There will be job gains, too. Even with automation, the demand for work and workers could increase as economies grow, partly fueled by productivity growth enabled by technological progress. Rising incomes and consumption especially in emerging economies, increasing healthcare for aging societies, investment in infrastructure and energy, and other trends will create demand for work that could offset the displacement of workers. Women could be somewhat better placed to capture these potential job gains than men because of the occupations and sectors in which they tend to work; however, this gain assumes that women maintain their share of employment in each sector and occupation from the present day to 2030.

By 2030, women could gain 20 percent more jobs compared with present levels (171 million jobs gained) vs 19 percent for men (250 million jobs gained) (Exhibit 2). Across the ten countries in our sample, on average 58 percent of gross job gains by women could come from three sectors: healthcare and social assistance, manufacturing, and retail and wholesale trade. On average, 53 percent of men’s gross job gains could come from the manufacturing, retail and wholesale trade, and professional, scientific, and technical services sectors. Women are well represented in fast-growing healthcare, which could account for 25 percent of potential jobs gained for them.

In our scenario to 2030 in the ten countries analyzed, over 150 million net jobs (factoring in both jobs displacement and jobs creation) could be added within existing occupations and sectors, the vast majority of which will be in emerging economies. Mature economies could experience minimal net jobs growth or even a net decline as any gains in employment in existing sectors and occupations are counteracted by increasing automation. Across the ten economies, 42 percent of net jobs gained (64 million jobs) could go to women, and 58 percent (87 million) to men if current employment trends in occupations and sectors hold.

In our scenario to 2030 in the ten countries analyzed, over 150 million net jobs (factoring in both jobs displacement and jobs creation) could be added within existing occupations and sectors, the vast majority of which will be in emerging economies.

In mature economies, net job growth (taking into account jobs lost and jobs gained) could be concentrated in only two sectors: professional, scientific and technical services, and healthcare. Today, women are well represented in the second, but underrepresented in the first in many countries; in Canada, Japan, the United Kingdom, and the United States women have lower representation in the professional, scientific, and technical services sector compared with their average share in the economy.

In emerging economies, net job growth could occur in a broader range of sectors including manufacturing, accommodation and food services, retail and wholesale trade, and construction (57 percent of net jobs gained in India, China, and Mexico). We find that in China, Mexico, and South Africa women tend to be more present than men in accommodation and food services relative to their overall share of employment and underrepresented in manufacturing and construction. In India, women are slightly overrepresented relative to economy-wide participation in manufacturing and strongly underrepresented in construction and accommodation and food services.

Waves of technological innovation not only displace or change the nature of many occupations, but also create entirely new ones. Historical trends in the United States suggest that up to 9 percent of the population could be employed in entirely new and emerging occupations by 2030. Examples from the past decade range from recently created jobs in machine learning and AI to ride-hailing drivers and roles in sustainability and resource management. If this estimate is extrapolated across our ten-country sample, that could mean that more than 160 million jobs could be created in these entirely new occupations by 2030. In order to meet the demands of such entirely new occupations, women will need the right skills—and also to have the labor mobility and networks to go after these jobs.

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Here is a direct link to the complete article.

Anu Madgavkar is a partner of the McKinsey Global Institute, where James Manyika is chairman and a director, Mekala Krishnan is a senior fellow, Jonathan Woetzel is a director, and Michael Chui is a partner. Kweilin Ellingrud is a senior partner in McKinsey’s Minneapolis office. Lareina Yee is a senior partner in the San Francisco office and chief diversity and inclusion officer for McKinsey. Vivian Hunt is a senior partner and managing partner for McKinsey in the United Kingdom and Ireland. Sruti Balakrishnan is a consultant based in Chicago.

 

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