LABOR MARKET TRENDS, WAGE

DETERMINATION, AND THE IMPACT OF

AUTOMATION AND TECHNOLOGY ON
EMPLOYMENT
ANAGHA MOHANAN
MARIYA U S
PRIYAMVADA B M
LABOR
MARKET

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LABOR MARKET?

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 LABOR MARKET?
The labor market, also known as the job market or employment market, is a dynamic economic
environment where employers and job seekers interact to facilitate the exchange of labour services.

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 Employment & Economic
Growth

LABOR Gross Domestic Product

MARKET & Productivity and Economic

ECONOMY Prosperity

Wages & Consumer Spending

Economic Cycles and Labor Market

Fluctuations

Education and skills development

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DEMOGRAPHIC SHIFT
Aging Workforce

youthful workforce

Generational Differences

Immigration

Urbanisation & Geographic shift

Gender composition

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SKILL GAP

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 Remote and Hybrid work

Upskilling and Reskilling

CURRENT
Remote Hiring and Onboarding
TRENDS
Sustainability

_________Growth

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Gig economy growth
 Indicator of Economic Health

LABOR FORCE Demographic Variations

PARTICIPATION International Comparisons

RATE Policy Considerations

Labor Force Labor Force

= _______________ x 100
Participation Working-Age Population
Rate

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WAGE
DETERMINATION
FACTORS

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 01
Labor Supply &
Demand
Correlation

02
Between
Education & Skill
Levels

03 Labor Unions

WAGE
04 Government
Regulations

05 Geographic
Location

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06 Experience &
Seniority
LABOR SUPPLY &
DEMAND

Increased supply can lower

wages while decreased supply
can raise wages.
Increased demand can raise
wages while decreased
demand can lower wages.
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CORRELATION BETWEEN
EDUCATION & SKILL LEVEL
Individuals with higher levels of
education tend to earn higher
wages compared to those with
lower levels of education.
Skill level plays a crucial role in
determining wages. Individuals
with advanced skills relevant to
their job function often
command higher salaries.
The combination of education
and skills is powerful. Individuals
with formal education who also
acquire and apply relevant skills
in their jobs are well-positioned
for career advancements and
higher wages. 14
LABOR UNIONS
LABOR UNIONS PLAY A SIGNIFICANT
ROLE IN INFLUENCING AND
DETERMINING THE WAGES OF WORKERS.

Collective Bargaining
Wage Increases
Minimum Wage Standarads
Skill Based Pay
Seniority Based Pay
Benefits and Perks
Dispute Resolution
Industry Standards
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 GOVERNMENT
REGULATIONS

Minimum Wage Laws

Equal Pay for Equal Work
Working Hours and Overtime
Bonus Act
Social Security and Provident
Funds
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GEOGRAPHIC
LOCATION
SEVERAL FACTORS CONTRIBUTE TO THE VARIATION
OF WAGES WITH RESPECT TO GEOGRAPHIC LOCATION.

Cost of Living
Population Density
Economic Conditions
Local Job Market

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 EXPERIENCE
& SENIORITY

Increased skills and expertise

Value to the employer
Seniority-Based Wage
Increases
Promotion Opportunities
Negotiation Power
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IMPACT OF
AUTOMATION AND
TECHNOLOGY ON
EMPLOYMENT

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THE 4TH INDUSTRIAL REVOLUTION

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AUTOMATION
Automation is the use of Optimize Improve Save time
operations efficiency
technology, machinery, or
software to perform tasks or Reduce errors Cost and
processes with minimal human Resource Saving

intervention. Traffic Lights

In an automated system, a Automated bankings
sequence of actions is Home Automation
Automated data entry
executed automatically based
Automated testing
on predefined rules or Chatbots
instructions. Robotic Assembly Lines
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ARTIFICIAL Virtual Personal Assistants

INTELLIGENCE
Artificial Intelligence (AI) is the
simulation of human intelligence in
machines, enabling them to perform
Machine Learning Algorithms
tasks that typically require human
intelligence, such as problem-solving,
language understanding, and learning.
AI systems are designed to analyze data,
make decisions, and adapt to new Natural Language Processing (NLP)
information or situations, often
replicating or surpassing human-level
performance in specific domains.
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 ARTIFICIAL
Image and Speech Recognition
INTELLIGENCE
Autonomous Vehicles

Healthcare Diagnosis

Financial Fraud Detection

Recommendation Systems in
E-commerce
Robotics

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JOB DISPLACEMENT DUE TO
AUTOMATION AND AI
A situation where workers lose their jobs
or face a reduction in job opportunities
because tasks or roles they once
performed are now being automated by
machines or AI systems.
This displacement occurs when
automation and AI technologies can
perform tasks more efficiently,
accurately, and cost-effectively than
humans, leading employers to replace
human labor with automation. 24
 JOB DISPLACEMENT
Automation of AI in Data Analysis Customer Service
Repetitive Tasks Chatbots

E-commerce
Autonomous Vehicles Retail Automation
Fulfillment Centers

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 POTENTIAL JOB LOSSES
Reduced Labor
Skill Mismatch Wage Pressure
Demand

Structural
Economic Disparities
Unemployment

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forbes
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STATISTICS ABOUT JOB LOSS
A 2020 study suggested that 82% of restaurant jobs are at risk of automation.
A 2020 study suggested that 82% of restaurant jobs are at risk of automation.

10. 37% of workers worry they’ll lose their jobs due to automation.

20.7% of Power and IT companies were recruited for at least one robotics-
related position in January 2022.

20 million manufacturing jobs will be lost to automation by 2030

Above 40% of workers with low levels of education will suffer displacement by
2030, compared to 10% of workers with high-level education. 28
JOB AUGMENTATION
Job Augmentation is the utilization of
automation and AI (Artificial
Intelligence) technologies to enhance
and amplify human work and
capabilities, rather than replacing or
displacing human workers.

This approach focuses on leveraging

automation and AI as tools to assist
and empower individuals, making
their jobs more efficient, effective,
and productive. 29
HOW AI AND Enhanced Decision-Making

AUTOMATION Increased Productivity

Improved Accuracy

COMPLEMENT Efficient Customer Service

Personalization
HUMAN SKILLS AND Safety and Risk

IMPROVE
Management
Data Analysis

EFFICIENCY Language Translation

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AUTOMATION CREATES JOBS
A 2020 study suggested that 82% of restaurant jobs are at risk of automation.
Artificial Intelligence created 58 million new jobs in 2022

71% of the total current task hours are completed by humans, as opposed to 29%
by robots.

70% of workers believe that automation is more of an opportunity to be highly

skilled.

AI could create as many jobs in the UK as it could displace them over the next 20
years.

Although robots replace other jobs, statistics reveal that the industry employs
over 150,000 people globally to engineer and assemble robots. 31
AUTOMATION CREATES JOBS(CASE)
The rapid While the number of
adaptation of bank tellers per
Automated Teller bank office initially
Machines (ATMs) decreased
had a similar effect
on the labor market.

The ATMs lowered the cost of opening new offices and increased the
number of offices, leading to even more hired employees. In recent years,
around 400,000 ATMs existed in the US, while the number of bank tellers
was around 500,000.
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THANK YOU