Technological change and the future of work

The Government asked the Productivity Commission to explore the impacts of new and changing technology on the quantity and nature of work.

The final report makes 35 findings and 18 recommendations. It focuses on what steps the Government can take to improve the ability of New Zealand and New Zealanders to adapt to and benefit from greater technological change. 
What did the inquiry find?
Technology doesn’t just replace jobs; it also creates them. Technology has many effects on the labour market, some of which are positive for workers, the quality of work, and jobs.

Predictions that technology will inevitably replace work are simplistic and out of step with historical experience.

There isn’t much sign of looming technological disruption. Faster technological progress would be evident in labour market and economic measures, such as productivity growth, occupational churn, and business start-up rates. But across the developed world, all of these measures are slowing or declining.

New Zealand needs more technology, not less. Technological progress and adoption drives productivity and income growth. If we want higher incomes for ourselves and our children, New Zealand firms need to take up technology at a faster rate than has been the case in recent years.

New Zealand is well-placed for faster technology adoption in some respects, but not in others. By international standards, adult New Zealanders are skilled and train at high levels. Our policy settings generally encourage openness to ideas, goods, services, investment and skills. And our labour market has historically done a good job of creating lots of jobs.

On the other hand, core skill levels in our schools are dropping; high house prices make it hard for some workers to move to better jobs; and New Zealand’s business environment lacks dynamism.

New Zealand should build on its strengths and address its weaknesses. The Productivity Commission recommends a number of policy changes to better prepare current and future New Zealanders for the future of work:

Make the training system more flexible and accessible. 
Improve and expand careers advice and employment support. 
Urgently address the performance of the school system. 
Update employment law to target harms, not platforms. 
Explore options for better income smoothing. 
Update regulation to remove barriers to technology and promote worker mobility. 

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