Industrial Relations and New Technologies

Exponential Technologies are destroying but also creating job positions, recycling and creation is directly proportional to each startup that is developed but inversely proportional to time.

Published in El Cronista on November 12, 2019
As a matter of fact, job destruction and creation occur in a context where on the one hand, resources are democratized with a general scope, like in the case of Smartphones; and on the other, resources are selective based on individuals’ skills to use new technologies. In this case, it depends on training and education at the elementary, secondary and university level with job opportunities.

The rising development of new technologies is mainly found in R&D centers in countries who enjoy a strong growth policy in a context of greater social, economic and political stability. In these countries, growth is tied to the business model. In Argentina an original and disrupting business model has succeeded against all odds; this is the case of Unicorns, Toyota or other companies related to land exploitation, livestock and industrial byproducts that have grown and started to export.

However, Artificial Intelligence (AI) is replacing manpower with self-managed, self-propelled and self-sufficient robotics. Furthermore, machines are manufacturing machines, and this is the first stage. Today machines that repair machines are in full swing. Right now machines that invent machines are being developed and this is what is coming along. Everything will have online virtual support, and the globe will go paperless.

The future is TODAY with the invasion of new apps that day after day are making customers’ interaction and satisfaction more dynamic and immediate, driving producers and distributors closer together, eliminating several steps of intermediation.

Take for instance MercadoLibre, Despegar.com, Uber, PedidosYa, Glovo, and car, bike and micro scooter direct on-demand rentals. Soon there will be available cars to be occasionally rented for short periods of time where users take cars at designated rental points and leave them at any authorized parking space. Users are charged service fees for the time actually used only. With the passage of time nobody will buy cars; they will be rented out when needed. The new app will serve as an efficient guide to access the service.

But there are other services that are not open for debate that are changing clients’ customs and habits. In fact, home banking allows clients to manage their bank accounts anywhere, and bank branches are gradually becoming fully automated virtual centers with no human presence on-site. Now thanks to delivery services, shopping at supermarkets, malls and stores will no longer require visitors to walk around.

These apps revolutionize processes, customs and usages, and especially create new consumption alternatives and benefits that in general tend to make operations cheaper and easier.

At the XI Symposium on Labor Law and Industrial Relations [XI Congreso de Derecho Laboral y Relaciones del Trabajo] organized by Universidad Nacional de Tres de Febrero, headed by Julio Grisolía, in the city of Mar del Plata, every voice was heard, even with contradiction.  Some people in favor, others against: no agreement was reached as to a reasonable solution to characterize the relationship of those who participate in the sharing economy through apps, in particular because it is known that any form of regulation may threaten the initiative with its extinction, and now, whether precarious or not, the sharing economy is creating job positions by the thousand.

In fact, it is said that the traditional model of industrial relations in Argentina is not competitive and drives workers out of the system. Hiring costs are really high; payroll taxes are absurdly high; there are problems of productivity during employment; and employment termination is extremely costly with serious issues if disputes are taken to Labor Courts, where the outcome is unpredictable and in general completely disproportionate.

The number of registered workers at ANSeS should be around 9 million, but it’s been almost a decade now that it does not exceed 6.3 million. Actually it does not keep up with the natural increase rate that today exceeds 250K job positions necessary to employ those new people who join the market minus those who leave because of retirement, disability or death.

The market of IT companies and enterprises knows no time or space, no national origin, no tradition, custom and usage, no religion, faith or God. It creates new environments without territorial boundaries, without an actual place to physically install their databases, which are usually stored in the Cloud, piercing any restriction and oftentimes evolving at such high speed that creations are outside the law, above the authority or scope of one national government, and therefore not subject to any local or international regulation.

To some extent, the big corporations that manage these new apps and other online media, such as social media, affinity groups or new communication systems, including LinkedIn, or WhatsApp, which has displaced email messaging, have taken over everything that we do, think, communicate or disclose every day. Snail mail will disappear.

Now in addition to national states, international organizations and social actors, such as unions and employers, there are now corporations that have acquired new telematics tools (communication + IT) that will undoubtedly be the leading figures of big events that will mobilize the world of the future that is TODAY.

By Julian A. de Diego
Director of the postgraduate course on Human Resources at the School of Business at UCA.