There is no escaping employment market upheaval in the digital age. Consider the global trends cited by Erik Brynjolfsson and Andrew McAfee in a recent interview with HBR.
In most countries, both developed and developing, private employment and median family income have stopped growing at the same pace as labor productivity and real gross domestic product (GDP) per capita—mostly due, they argue, to technological advances. In emerging markets, labor’s share of gross domestic product is declining in 42 out of 59 countries, including China, India and Mexico—areas with 90 percent of the world’s population. Fewer jobs and diminishing wages can only lead to greater inequality and global instability.
So what are we to do? Learn from countries that are bucking the trend. In Singapore median income, GDP per capita and labor productivity have all grown dramatically over the past 30 years; unemployment stands at just 3 percent; wages account for a larger percentage of GDP than they did in 1980; and middle-income earnings have increased sixfold in the past five decades.
With the highest median wage among newly industrialized Asian nations, the city-state also ranks first globally in worker productivity and attitude. Singapore has succeeded by investing large portions of its public budget in education, a strong civil service and the development of great leaders, proactively moving its economy toward technology-based manufacturing, and more recently to knowledge-based research and development sectors.
Professions-based education—which strengthens future employability for students—has also been a key area for investment and innovation in Singapore. Today, 95 percent of its young people progress to post-secondary education institutes, but there are also different pathways to work, including a German-style apprenticeship and certification program. Most recently, Singapore launched a fund in which the government provides a yearly stipend to be used for continuing education at all levels.
Can other countries follow this model? With the right leadership, I think so. On a recent trip to Africa I was greatly impressed by the African Leadership Academy, founded in 2008, which offers a highly selective two-year pan-African pre-university program.
Nearly 800 young people have already studied there, and the goal is to develop 6,000 leaders over the next five decades—who will, it’s hoped, transform Africa as national presidents, central bank governors or CEOs of major corporations. This is the sort of institution that public and private organizations around the world should look to build. We need extraordinary leaders to face the monumental challenge of preserving human dignity in the digital age.
Claudio Fernández-Aráoz is a senior adviser at the global executive search firm Egon Zehnder and the author of It’s Not the How or the What but the Who.