The Future of ‘Work’ in the Global North and Global South

by Richard Seifman – Former World Bank Senior Health Advisor and U.S. Senior Foreign Service Officer

September 4, 2024

For my offspring and the children of friends here and elsewhere in the Global North and South, I worry about what future jobs will be available for them. I decided to look at some of the most critical factors.

Work in the Global North and Global South is poised to undergo a significant transformation due to multiple factors, including demographic shifts, technological advances, and climate change. Whether called “work” or “labor,” the focus is on producing goods and services from human efforts, whether physical exertion or mental efforts, with or without non-human assistance, done in exchange for economic reward.

These are momentous evolving factors affecting current and future generations, creating uncertainty for many of today’s workers and certainly for future generations.

Throughout history, workforce composition has undergone massive transformations. One of the most significant sectors affected has been agriculture. Until the nineteenth century, agriculture employed roughly three-quarters of the global workforce. By 1970, its share had dropped to 51% of the world’s economically active population. Today, according to the World Bank, agriculture employs roughly 26% of the total global workforce (2022 data). This significant decline — a 50% drop over just 30 years — reflects the shift towards industrialization and service-based economies in many parts of the world. 

For further perspective, consider that direct on-farm employment in the United States accounted for 1.2% of total employment in 2024. By contrast, in one of the fast-growing BRIC countries, South Africa, roughly 20% of its total employed workforce was still in agriculture in 2022. And according to the World Bank, in 2022, Singapore had only 0.11% of its total employment in agriculture, while South Korea and Mauritius had about 5%. 

The point is that in today’s world, agriculture can be minimal in a country’s labor force and still be economically successful. 

The Garment Industry Illustration

Agriculture is one example with a very long history. The garment sector offers another in dealing with changes in a labor force’s past, present, and future.

The garment industry has undergone significant transformation since the 1900s when those working in manufacturing apparel were mainly in developed countries and primarily women. This industry subsequently moved to developing countries; now, technological changes are dramatically altering the industry’s dependence on humans in the design and manufacture of clothing.

Sweatshops in the Global North: In the early 20th century, many garment factories in Europe and the United States were notorious for sweatshop conditions. Workers, often immigrants and primarily women, labored long hours in unsafe environments and for minimal pay.

Shift to Low-cost Labor in the Global South: By the late 20th century, much production had been outsourced to developing countries. Labor was cheaper, and regulations were less stringent. Countries such as China, Bangladesh, and Vietnam became major hubs for garment manufacturing, resulting in more affordable clothing, the rise of “fast fashion,” and export revenues.

Automation and Technological Advances: Today, the garment manufacturing industry is increasingly automated, using robots and AI to perform tasks such as cutting, sewing, and quality control. This new technology reduces labor costs, increases efficiency, and improves product quality, leading to less reliance on unskilled workers and job displacement.

Macro Factors Affecting Future Labor Across All Sectors (as seen from 30,000 Feet)

Experts in many disciplines and institutions deal with this vast subject in depth. That said, a brief non-expert overview can help underscore a few key factors influencing the evolving labor landscape—specifically demographic shifts, including gender, technological advances, and future impacts of climate change.

Demographic Shifts in the South and North

The story is different in the Global North and Global South. let’s take it in turn, focusing on the main differences.

Global South:

Youthful Population: Many developing countries have a relatively young population, higher birth rates than in developed countries, and, consequently, higher numbers of potential workers. 

In 2024, the ten countries with the highest population growth rate are all located in Africa, but high population growth is also occurring in parts of South Asia and the Middle East. 

It will take time to change this dynamic, but many developing countries are beginning to undergo a demographic transition, leading to lower birth rates and changing gender demographics.

Labor Force Participation: The International Labor Organization (ILO) defines the labor force participation rate as the percentage of the population between the ages of 15 and 24 who are active,  either employed or actively looking for employment. This calculation includes people who provide labor for the production of goods and services during a specific period.

The ILO developed the concept of the “jobs gap,” e.g., the number of jobs needed, which complements the calculation of the labor force participation rate and the percentage of the work-age population who are working or actively looking for work. 

In its World Employment and Social Outlook: May 2024, the ILO predicts that in 2024, “[t]he jobs gap in low-income countries reaches a striking 22.8 percent for women, versus 15.3 percent for men. This contrasts with high-income countries, where the rate is 9.7 percent for women and 7.3 percent for men.” 

Further, a significant portion of the workforce in developing countries operates in the informal sector, where labor protections are often lacking. Women are disproportionately represented in informal work, with job insecurity and lower wages.

Global North:

Aging Population: Many developed countries, particularly in Europe, North America, and the advanced economies in Asia, have aging populations resulting from lower birth rates and higher life expectancy. 

Often, the size of their native-born, available labor force is stagnating or shrinking, which has necessitated the use of alternatives to care for their elderly. Japan is an example of a country with an aging population and a low birthrate. It has been using robots as substitutes for humans to provide personal care to older people.

Further, this demographic shift has created a skewed gender ratio, with more women than men in older age groups.
Jobs Gaps:  In developed countries, the composition of the labor force has significantly changed, with increasing numbers of women entering the workforce pool. Some factors contributing to this change have been increased educational attainment among women, greater acceptance of women in roles outside the home, alternatives for childcare, and employers’ policies such as flexible work arrangements and maternity leave.

Another cross-cutting facet is globalization, which affects labor demands in both developing and developed countries. It has a major impact on where and what is produced, as well as the numbers and kinds of workers needed throughout the supply chain. Consequently, changes in globalization owing to great-power tensions and other factors are likely to significantly affect the demand for workers in individual countries.

Technological Advances

Increasing technological change, such as the rise of robotics and artificial intelligence, has had and will have massive ramifications on how goods and services are produced and delivered. Such innovations have increased productivity, which, as a result of greater competition, translates into lower prices and gives consumers opportunities to buy additional goods and services.

Fears of technological unemployment go back at least to the early 19th century.  Nobel economist Paul Krugman noted, “While technology has often eliminated some jobs, however, historically this has always been, as [Maynard] Keynes wrote, ‘a temporary phase of maladjustment,’ with other forms of employment rising to replace the jobs lost.”  

With respect to AI, the investment company Goldman Sachs’ base case is for AI to increase the growth rate of productivity — output per person-hour — by almost 1.5 percentage points a year over a decade, or for ten years, about 15 percent.

Another significant factor shaping where and how work is performed is the result of much-improved access to the worldwide internet. It has revolutionized and accelerated remote work by making it possible for people to function from anywhere in the world, thereby breaking down geographical barriers that once limited private and public sector operations. 

Organizations can now look for and find talent beyond their immediate geographic area, which benefits both developed and developing countries by allowing skilled individuals to participate in a global economy while remaining in their local communities. This could have a countervailing effect to AI job destruction, and as WEF economists put it in a recent article, it could be one reason “why AI will not lead to a world without work.”  

The Global South: 

In developing nations, the implementation of robotic processes will affect low-skill jobs in manufacturing, agriculture, and even mining operations, increasing productivity without a massive workforce.  

That said, as technology becomes better understood and accessible, developing countries can pivot to creating tech-driven jobs and fostering their workforce to meet the needs of a digital economy.

The Global North: 

Both robotics and AI are increasingly performing tasks traditionally done by humans, especially in manufacturing, logistics, and even professional services. 

This trend has job-displacement implications but also creates opportunities for more highly skilled positions designed to work alongside technology. As happened when the automobile replaced horses, the se new technologies have and will likely incur pain with the econommic transformation, but with productivity and wealth gains.

Climate Change

Climate change has many dimensions that have a major effect on future work environments, workforce needs, and the size and composition of a workforce. 

For example, as different geographic regions experience severe climatic change, working-age individuals and their families migrate, affecting both the departing and recipient countries. There are, of course, other aspects of climate change that will necessitate finding ways to adapt to known, foreseeable, and unforeseen events and putting in place the skill sets needed.

Global South: 

Climate change is often felt acutely in these countries, as they are challenged by extreme weather events, droughts, and rising sea levels but have limited human and financial resources. 

Adaptation strategies will require new, trained, and better-equipped workers to address climate resilience and sustainability practices. 

Policies will be needed to enable workers to transition to new, sustainable sectors, away from traditional, carbon-intensive industries.

Global North: 

Richer countries are beginning to take on the initially costly investment in green technologies, renewable energy, and sustainable practices. 

For them, transitioning to a “green economy” will create jobs directly linked to environmental sustainability and provide innovations in other sectors.

Convergence of Trends for both the Global South and North

In assessing the future of work, it becomes evident that several interrelated trends will shape the global workforce:

Adapting Education Systems: Countries will need to rethink the role of their education systems to ensure that the skills taught align with future demands. 

Emphasizing STEM, critical thinking, creativity, and software skills will be crucial and will need to be supported by collaboration among governments, educational institutions, and employers.
Public Policy and Support: Governments play a pivotal role in shaping the future of work. Policy frameworks that support innovation, protect workers’ rights, and ensure social safety nets will contribute to managing disruptions caused by technology and climate change. 

In the New York Times April 2024 “New Ways to Bring Wealth to Nations,” the case is made that developing country economic management must include how it will include the private sector, attract and shape foreign investment.

For developed nations, it also means addressing automation and unemployment; in developing nations, it will involve creating a conducive environment for job creation and investment. Moreover, policies will be needed to address the initial disruptions in the workforce resulting from changes in demography, technology, and climate, and the responses to those changes.
Inclusive Economic Growth: As technology transforms industries, it often exacerbates existing inequalities and their effect on the workforce. Both developed and developing countries need to ensure that all population segments benefit from the changing world of work. This need includes supporting marginalized communities, women, and low-income workers through inclusive policies and open access to resources.
Global Collaboration: Demographics, technology, and climate change pose global challenges that require international cooperation. 

Developed and developing countries will need to collaborate on innovations, share best practices, and create pathways for sustainable growth that benefit everyone. Such collaboration can take many forms, including bilateral agreements, multilateral coalitions, and partnerships between private and public sectors.

What’s Next

A complex interplay of demographic changes, technological advances, and climate imperatives will shape the future of work. 

Developed countries will need to adapt to an aging workforce and the rise of automation. In contrast, developing countries will face the challenge of harnessing their youthful populations in a world increasingly driven by transformational changes.

Both must prioritize education, inclusive growth, and robust public policies to navigate these transformations successfully. 

Ultimately, by fostering resilience and innovation, societies can create a future of work that is not only sustainable but also equitable and prosperous for all. The key lies in adapting to these changes proactively and collaboratively in the face of new challenges and opportunities.

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Richard Cooper contributed to this article.

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This article was originally published on IMPAKTER. Read the original article.