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Austria in 2030: Will you be an entrepreneur or out of work?

03/06/2018

by Prof. Nikolaus Franke

Many people wonder how they can protect themselves and their children against the negative effects of job-market changes.

 

Prof. Nikolaus Franke, Academic Director of the WU Executive Academy's Professional MBA Entrepreneurship & Innovation and Head of WU Vienna's Institute for Entrepreneurship & Innovation, has clear answers for them.

 

The repercussions of digitalization, robotics and artificial intelligence

There are a number of studies analyzing the effects that technological advances in the fields of digitalization, robotics and artificial intelligence have on the job market. In a current piece of research, Frey and Osborne, for instance, have found that in developed economies 47% of jobs might fall victim to automation over the next few years. The various forecasts differ in terms of numbers, but they all make one thing clear: Sweeping change is imminent. Like in the 19th century at the time of what is called the industrial revolution, the change is driven by technology. Back then, machines replaced physical work. Nowadays and in the future, learning algorithms can do office work and provide services in a better, faster and less error-prone manner than humans.

Picture of a computer chip
Yesterday machines, today learning algorithms - the driving force for job-market changes was and still is technology. Photo © CC0 Licence

Fighting the machines? Prohibiting them? Giving oneself over to resignation?

In the 19th century, workers tried to fight the effects of mechanization by destroying newly erected factories. They did not succeed. Since then, things have become even more complicated as intangible cloud-based algorithms are much harder to combat than machines. Passing legislation prohibiting the use of machines is another possible approach to keeping automation at bay. In the USA, for instance, more than half the population is in favor of restricting the proportion of jobs machines are allowed to replace. In Austria, too, some people advocate this idea. At the end of the day, they will not have their way because by adopting such measures countries not only reduce their international competitiveness—which is fatal for export-dependent nations like Austria—but they also forego prosperity. If machines do the work, the same amount of work will produce people more and better products and services. So, generally speaking, this is a beneficial development. But what about the individual? How can you ensure that you will not fall victim to automation?

 

The right response: entrepreneurship

Algorithms cannot replace all types of work equally well. They are most powerful when applied to tasks involving, above all else, regular, simple patterns. Such routines can be turned into neural networks, for instance, and be reproduced with a high degree of perfection. Subsequently, the task can be automated. At the other end of the spectrum, there are activities that involve inventing things or combining existing ones in novel ways, identifying new approaches and spotting opportunities that others do not yet see. In this context, previously used patterns are, by definition, non-existent or practically non-existent. That is to say: Innovation is key, and entrepreneurs, who are the drivers of innovation, will have a bright professional future.

Picture of a lightbulb as a symbol for ideas
Algorithms cannot replace all types of work equally well: creative thinking will be remain a human domain (for now). Photo © CC0 Licence

Will we all become entrepreneurs?

Obviously, this does not mean that we will all become entrepreneurs in the legal sense of the term, i.e. not each and every one of us will start and run his or her own business; that said, entrepreneur is a job that will continue to gain in importance. What this means, though, is that all jobs that have an entrepreneurial side to them will become increasingly important, and that the entrepreneurial side will gain in significance in any job. Entrepreneurship is about creativity, a self-starting attitude, responsibility, the willingness to take risks, resourcefulness and perseverance when it comes to implementing things and making them succeed. Blue-collar and white-collar workers in business also need these entrepreneurial qualities, and the same goes for those who make a living in public administration, in politics, in research or in education. Entrepreneurship is, and always will be, the exclusive preserve of humans.

 

The revolution has long begun

We are not talking about change in the distant future; we are talking about change that has been going on for quite a while. Analyses by Goos and Manning, for instance, show not only the significant extent to which people are winning and losing already as a result of job-market changes but also the considerable problems facing those unable or unwilling to adapt to the new realities. This is a huge political challenge, and education will play a key role in addressing it. Above all else, investments will need to be made in entrepreneurship and innovation—and this is particularly true as far as the individual is concerned: The best protection against being driven out of work is to develop and train your ability to think and act like an entrepreneur.

 

To get more information about Entrepreneurship and the Professional MBA Entrepreneurship & Innovation click here.

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