About 1.4 million U.S. workers are expected to lose their jobs as a result of the Fourth Industrial Revolution and other structural changes over the next decade. According to a new World Economic Forum report, it will be possible to transition 95 percent of at-risk workers into positions that have similar skills and higher wages for a price tag of roughly $34 billion. The cost of reskilling these workers will largely fall on the government, with the private sector only able to profitably reskill 25 percent of the 1.4 million workers at risk. For the rest, it would be more cost-effective for businesses to replace them with workers with the correct skill-set. The ability of the private sector to profitably absorb the reskilling burden could rise to 45 percent of at-risk workers if businesses collaborate to create economies of scale. The report also finds that the government could reskill as many as 77 percent of all at-risk workers, with a clear return on investment coming from increased tax returns and lower social costs, such as unemployment compensation. For the remaining 18 percent, the costs outweigh the economic returns to government, while for 5 percent a similar-skills and higher-wage pathway is not available. With 18 percent of all at-risk workers unable to be profitably reskilled by either business or the public sector, the report suggests that governments should consider expanding welfare and social support, paying for negative-return reskilling due to its societal returns and reducing the costs of reskilling and retraining through incentives to and collaboration with the private sector and educators, including apprenticeships and online learning.
Read the full article on WEForum.org.