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Human Capital

Technology can help spring workers from the informality trap

Kristalina Georgieva's picture
Women stitch handicrafts at Everest Fashion Fair Craft in Lalitpur, Nepal. © Peter Kapuscinski/World Bank
Women stitch handicrafts at Everest Fashion Fair Craft in Lalitpur, Nepal. © Peter Kapuscinski/World Bank

Technology and what it will do to change how we work is the driving obsession of the moment. The truth is that nobody knows for sure what will happen – the only certainty is uncertainty. How then should we plan for the jobs that don’t yet exist?
 
Our starting point is to deal with what we know – and the biggest challenge that the future of work faces – and has faced for decades – is the vast numbers of people who live day to day on casual labor, not knowing from one week to the next if they will have a job and unable to plan ahead, let alone months rather than years, for their children’s prosperity. We call this the informal economy – and as with so much pseudo-technical language which erects barriers, the phrase fails to convey the abject state of purgatory to which it condemns millions of workers and their families around the world.

What will be the future of work?

Jim Yong Kim's picture


Do you wonder if the good fortune and opportunities that you’ve enjoyed in your professional life will be available to your children, and to their children? At a time of strong global economic growth, it may seem paradoxical that we face an existential crisis around the future of work. But the pace of innovation is accelerating, and the jobs of the future – in a few months or a few years – will require specific, complex skills. Human capital will become an ever more valuable resource.

In short, the changing nature of work – and how best to prepare people for the jobs of the future – are some of the toughest challenges countries face, which is why they’re the subject of this year’s World Development Report.

Because the future of work matters to all of us, we decided to give this report an unprecedented level of transparency. For the first time since the World Bank began publishing the WDR in 1978, the report is completely transparent throughout the writing process. Every Friday afternoon, the latest draft is uploaded to the World Bank website, so that anyone with internet access has an opportunity to read it and engage with the team of authors. I can’t promise that the WDR won’t have changed a week from now, which is why I encourage you to keep revisiting it as we keep revising it.

For new readers, here are a few insights into the report’s contents that I hope will get you thinking about the future of work:

Spatially awhere: Bridging the gap between leading and lagging regions

Sameh Wahba's picture


As the world urbanizes rapidly, international experience has shown that economic activities concentrate in a relatively small number of places – it is estimated that only 1.5% of the world’s land is home to about half of global production.

Such economic concentration is a built-in feature of human settlement development and a key driver of growth. However, while some countries have succeeded in spreading economic benefits to most of their citizens, many other countries have not.

Especially outside the economic centers that concentrate production, there are “lagging areas” with persistent disparities in living standards and a lack of access to basic services and economic opportunities.

Today, over two billion people live in such lagging areas. Over one billion people live in underserved slums with many disparities from the rest of the city in terms of access to infrastructure and services, tenure security, and vulnerability to disaster risk. A further one billion people live in underdeveloped areas with few job opportunities and public services.

How can countries address the division between the leading and lagging regions?

As discussed at the Ninth Session of the World Urban Forum (WUF9) in Kuala Lumpur, Malaysia, we at the World Bank Group are taking an integrated territorial approach through a “spatially awhere” lens to tackle the land, social, and economic challenges altogether.

[Download: World Bank publications on urban development]

A seat at the table: WBG EDs and CSO discuss investing in human capital.

Anna Molero's picture


At the Spring Meetings of the World Bank and IMF Board of Governors, civil society get to engage directly with the World Bank’s Executive Directors (EDs). This year, I was honored to co-chair the CSO-ED Roundtable with Mr. Herve de Villeroche, Co-Dean of the World Bank Board and Executive Director for France.
 
I came to the Spring Meetings in my role as Chief Government Officer for Teach For All, a global network of 48 independent civil society organizations developing collective leadership to ensure all children can fulfill their potential. As moderator, I represented my CSO peers and noted during my opening remarks the “crucial partnership and dialogue needed between CSOs and the communities they represent at the highest level of leadership in our shared ecosystem.”

Can Ghana’s extreme poor be graduated?

Suleiman Namara's picture
A stronger focus on human capital investments of children from these households with a particular focus on skills for future jobs will be key. (Photo: Arne Hoel / World Bank)


Ghana was the first country in Sub-Saharan Africa to meet the Millennium Development Goal (MDG1) target of halving extreme poverty by 2015. A share of the population living in poverty decreased from 52% in 1991 to 24% in 2012. Ghana is eager to lead the way in Africa again, but this time to graduate extreme poor households, out of poverty. The current policy debates are around graduating in about three to four years some 8.4 % of households living in extreme poverty. But to what occupations?

Amp up your 2018 Spring Meetings experience

Bassam Sebti's picture


Our 2018 Spring Meetings is just around the corner and it’s time to get organized. Mainstage speakers include representatives from top-notch institutions such as LinkedIn, Oxford University, Financial Times, Brookings Institution — in addition to influencers Bill Gates and Jeff Weiner.

Connect, engage and watch to take full advantage of everything the #WBGMeetings has to offer. 

Toward a linked and inclusive economy

Jim Yong Kim's picture
The arrival of broadband internet is set to significantly improve medical services in Tonga. © Tom Perry/World Bank.
The arrival of broadband internet is set to significantly improve medical services in Tonga. © Tom Perry/World Bank.

While some studies predict automation to eliminate jobs at a dizzying rate, disruptive technologies can also create new lines of work. Our working draft of the forthcoming 2019 World Development Report, The Changing Nature of Work, notes that in the past century robots have created more jobs than they have displaced. The capacity of technology to exponentially change how we live, work, and organize leaves us at the World Bank Group constantly asking: How can we adapt the skills and knowledge of today to match the jobs of tomorrow?
 
One answer is to harness the data revolution to support new pathways to development. Some 2.5 quintillion bytes of data are generated every day from cell phones, sensors, online platforms, and other sources. When data is used to help individuals adapt to the technology-led economy, it can make a huge contribution toward ending extreme poverty and inequality. Technology companies, however well intended, cannot do this alone.

To build a brighter future, invest in women and girls

Jim Yong Kim's picture


Arne Hoel

As we mark International Women’s Day 2018, there has never been a more critical time to invest in people, especially in women and girls. 

Skills, knowledge, and know-how – collectively called human capital – have become an enormous share of global wealth, bigger than produced capital such as factories or industry, or natural resources.

But human capital wealth is not evenly distributed around the world, and it’s a larger slice of wealth as countries develop. How, then, can developing countries build their human capital and prepare for a more technologically demanding future?

The answer is they must invest much more in the building blocks of human capital – in nutrition, health, education, social protection, and jobs. And the biggest returns will come from educating and nurturing girls, empowering women, and ensuring that social safety nets increase their resilience.

According to UNESCO estimates, 130 million girls between the age of 6 and 17 are out of school, and 15 million girls of primary-school age – half of them in sub-Saharan Africa – will never enter a classroom. Women’s participation in the global labor market is nearly 27 percentage points lower than for men, and women’s labor force participation fell from 52 percent in 1990 to 49 percent in 2016.

What if we could fix this? Fostering women’s labor force participation, business ownership, and improvements in productivity could add billions to the global economy.

Growth miracles: Are they things of the past?

Vinaya Swaroop's picture



Is the era of industrialization and manufacturing exports growth miracles – a period of rapid economic growth exceeding expectations, last seen in East Asian countries, most notably in China – over? If you listen to Harvard’s Dani Rodrik, the answer seems to be: pretty much! Does that mean, Africa, the only continent which hasn’t seen rapid export-led manufacturing growth, would not have many growth miracle stories?

In Senegal, a call to invest in people and the planet

Jim Yong Kim's picture


For three days this month, the West African nation of Senegal was in the spotlight of global efforts to combat climate change and improve education in a rapidly changing world.

French President Emmanuel Macron and Senegal’s President Macky Sall co-hosted a conference in Dakar to replenish the Global Partnership for Education (GPE) – a funding platform to help low-income countries increase the number of children who are both in school and learning.

African leaders and partners stepped up to announce their commitment to provide an education that prepares children to compete in the economy of the future and advances socio-economic progress.

Heads of state from across the continent described their challenges—including terrorism, insecurity, the influx of refugee children who need an education, the strain on national budgets, and the cultural bias against educating girls.


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