Turning the risks of Industry 4.0 into job opportunities

On Thursday, June 13th, 146 scholarship recipients who are completing their graduate degrees at different Spanish universities attended an event at the Museum of the Americas. BBVA’s Executive Board Member, José Manuel González Páramo, gave the closing speech at the event with a presentation on the future of employment.

As González-Páramo explained at the event, “The relationship between technological advances and jobs is one of the most controversial issues in our society.” In this regard, it’s evident that we live in a new age of transformation called the fourth industrial revolution, which is characterized by interconnectivity, technological infrastructure, artificial intelligence and data management.

Although rejection of technological change has existed in all industrial revolutions, as  González-Páramo noted, “The quality of life and jobs are now better than ever.”  To demonstrate this, González-Páramo made a comparison that showed how the GDP of the U.S. has multiplied by 7.4 over the past century, and the U.K.’s by 5.7. Moreover, “technological advances did not destroy jobs on an aggregate level” during this period.

How to overcome the challenges of Industry 4.0

The current stage of disruption opens the door to great opportunities in the workplace, but also to new demands and characteristics. According to González-Páramo, the jobs of the future will be “less routine and standard; more fragmented; and subject to continuous change.”

The biggest risk posed by technological transformations in terms of jobs has to do with the possible increase in inequality due to the inability of some sectors to adapt to the changes. This inequality could emerge among workers, companies and countries.

Another threat is that automation could lead to the destruction of jobs. A BBVA Research study shows that 36 percent of workers are in jobs at risk from automation in Spain; 52 percent in Mexico and up to 61 percent in Peru. However, as González-Páramo emphasized, innovation will also “create new jobs - jobs that will seem as strange to us as today’s jobs seem to our grandparents.”

In his opinion, both the public and private sectors have a responsibility to combat the risks posed by this digital transformation age, protecting people, and not jobs. “The response from the private sector should focus on radical change in companies in four areas: strategy, finance, technology and culture, and leadership,” he affirmed. In particular, this cultural change is based on moving toward a flatter organization with agile methodologies, in which employees play a leading role in their professional development and are provided platforms for continuous learning. BBVA has become a leader in terms of incorporating this cultural change.

Ultimately, González-Páramo indicated that: “The jobs of the future will be very different from those we are familiar with. Authorities and the private sector have to anticipate the changes in the job market and bring the age of opportunity to everyone.”

Scholarships for Latin American youth

BBVA is highly committed to Latin America, promoting access to financial services to the entire population, as well as small and mid-sized enterprises. The historic relationship between the bank and the Carolina Foundation is an example of BBVA’s important connection to the Latin American region.

The Carolina Foundation is an institution that promotes cultural relations and educational and scientific cooperation between Spain and the other countries in the Ibero-American Community of Nations. BBVA is an institutional trustee of the foundation.

Apart from reflecting on the future of jobs, the purpose of the Carolina Foundation’s June 13th event, which José Manuel González-Páramo attended, was to increase contact between the foundation’s staff and the collaborating companies and institutions, like BBVA, and the foundation’s scholarship recipients.