50th St. Gallen Symposium "Freedom Revisited": 7–8 May 2020


The Shadow Economy and The Future of Jobs

What is the first picture that comes to mind when you hear ‘The future of jobs’? A blue-collar worker in a car assembly line in Detroit replaced by a robotic arm? The populist movements that won the American elections and voted for Brexit, with people shouting slogans like “bring our jobs back to our country”?

Intelligent physical robots and artificially intelligent software or digital robots are expected to replace 35–47% of jobs in the developed world – based on studies conducted in these regions. These regions, primarily in North America and Western Europe, lead the fourth industrial revolution, which is raising the question we’re discussing today – the future of jobs.

This is my main friction with the existing narrative – the excessive focus of this topic on developed economies and the lack of nuance in differentiating fundamentally different populations – socially, economically and politically.

Longer-term forecasts suggest that today’s developing and emerging countries are likely to account for nearly 60% of world GDP by 2030. An integral driver of these markets is the shadow economy, which is work done for cash, where taxes aren’t usually paid, and regulations aren’t strictly followed.

The context of labor is completely different in these countries. For example, an upper middle-class household in India can afford a domestic help for their houses and drivers for their cars, unlike their western counterparts. The shadow economy accounts for almost 18% of the country’s GDP. These jobs are major contributors to the economy, among a hundred other forms of shadow labor. As a percentage of GDP, the shadow economy ranges from 25–60% in South America and around 13–50% in Asia. These countries are human labor intensive and for reasons beyond the availability of knowledge of automation.

The context of labor is completely different in these countries.

Yet, very few studies and experts address the future of the majority of the global population – countries in Asia, Africa and South America. Also, most of the experts and thought leaders on the topic are western-educated and from industrialised, rich and democratic societies.

Clearly, the narrative on automation and jobs needs nuance and diversity. The more pertinent questions in my opinion are – What is happening in the rest of the world, where the majority of earth’s population live; how are they different and how we can we help their transition to the fourth industrial revolution? It’s time to look beyond the tip of the iceberg and explore the vast expanse below.

Clearly, the narrative on automation and jobs needs nuance and diversity.



 Future jobs appears to be a blessing but unfortunately tecnology is on the verge of taking manual labor and making it technologically oriented. It is true, they taking over businesses and labor. 

I agree with the article, the developed nations will be the ones which will experience the progress of technology and hence lead to an effect on human labor. The developing nations will take some time to feel the effect but in the end will feel it gradually, both good and bad. 

its those effects and the extent of that would either make or break them, lets pray the Divine Intervention of Christ Jesus

Honestly we've been REALLY looking into automation for Orlando Pool Resurfacing. While it cuts jobs out of the US that's okay becasue we're adding to the business which will in turn create more jobs in reality.