Dear participants!
Given the unique challenges presented to us by the pandemic, no topic is more urgent during Latvia’s recovery from the crisis than the future of jobs and skills. Therefore, it is my honour to open this conference on ‘The Future of Jobs’.
I
The COVID-19 pandemic has created severe tension, not only in our health care systems, but also on the economy and the jobs market. Those working within the sectors of hospitality, tourism, culture, and aviation will feel this more acutely than anyone. The crisis has created unprecedented impact on everyone, but especially lower-paid workers who will continue to experience uncertainty in the upcoming months.
However, even before the pandemic, we lived in uncertain times when it comes to job markets. The purpose of today’s conference is to identify the trends and main reasons behind this uncertainty and what could be the solutions.
II
The shortage of skilled labour has been a growing problem for Latvia for the last decade and this problem is faced by almost every sector of the Latvian economy. For a small economy like ours, we have always needed all the hands we can get, but in the past decade the financial crisis, subsequent emigration wave and the declining demographics have aggravated the situation.
Reform of the education system is essential to make sure that our home-grown talents remains competitive in the future and I am pleased we are making progress in this area. I am also glad to note Latvia has been very successful in creating an environment where women are given an equal chance to succeed in their career of choice, especially in the STEM field where Latvia is among the EU states where the majority of scientists, engineers and researchers are women.
However, improving the quality of the education system and the levels of citizen’s participation in the economy is only one side of the solution for the future of jobs.
III
In the recent years all over the globe the speed of technological innovation and development has become much faster. The rate of automation and digitalisation is accelerating also in Latvia. We are proud of our companies that are achieving great results in the export markets, but to continue their growth they must recognise the value of human capital investment.
According to the recent survey done by the Foreign Investors Council in Latvia, the rise in unemployment because of the pandemic, has not helped to address labour shortages in some sectors, because the skills of the unemployed do not match the labour market needs.
The Latvian companies should seize the opportunity and invest in the skills of their employees to continue experiencing growth in productivity and gaining competitive advantage. Latvian businesses should take a lead with on-the-job training and provide opportunities to workers to upgrade their skills, especially in the post-pandemic recovery period.
IV
We urgently need to equip our citizens with skills that are necessary to prepare them for the changes our economy will experience in the upcoming years. However, to change something, we first need to recognise that there is a need to change.
The Latvian government must be more proactive and make it a political priority to invest in the reskilling and upskilling programmes for our population, going beyond vocational education and training. A massive investment in skills is needed to achieve the green and digital transformation of our economies. This is recognised across the European Union and it should be recognised in Latvia. The government should look at creating a standardised way towards mapping skills gaps in Latvia and helping economy to fill in the shortages they experience now. Looking into the future and in the context of COVID-19, priority should be given to preventive work with people whose jobs are endangered by the introduction of new technology and automation.
To progress towards a more prosperous and inclusive society, we as individuals also must not only make smarter choices about our education and career’s paths, but we must accept that lifelong learning and acquiring new skills is the future. We must seek out opportunities to update our knowledge and learn new skills.
There is a silver lining to the pandemic because of switching to remote work. The pandemic has contributed to the digitalization and automation of many processes we used to do in person. To work and to be in touch with our loved ones, we have advanced our skills in remote work technologies, whilst product and service providers had to advance their knowledge and use of e-commerce to reach their customers.
V
When it comes to digitalisation, we must not forget that it is changing and will change not only provisions of work but also the relationship and communication between the state and service providers on the one hand and citizens on the other. The transfer from real and human communication to automated and digital must be designed in such a way that it does not diminish the existing rights and opportunities of citizens. Under no circumstances should digitalisation create a new divide in society, the digital divide.
For the society to benefit from digitalisation, we must recognise that digital communication must meet certain standards, which may not be deviated from. The usual banal, meaningless formulas used in this connection, such as ‘user-friendly’, ‘fast and unbureaucratic’ and so on, are not appropriate here.
The new standards and conditions must consider, for example, that the user always has access to his entire file at once and can store it electronically on his local server and print it; or that the user always has a ‘back’ button and can correct his text at any time that he is automatically compensated for damages if his private data is leaked; or the user can at any time switch to talking to the service provider and not just with a chat bot, etc.
In short, we must have a clear understanding about the kind of relationships we want to digitalise, as well as know the real costs and the real savings of digitalisation for our society. Therefore, we must enter this new digital age with citizens equipped with good basic digital skills that can fully benefit, as well as take part in the digital economy.
At the heart of successful digitalization will be the talent able to carry out changes effectively. According to the European Digital Economy and Society Index, people in Latvia have one of the lowest levels of basic digital skills among the EU countries. We need to change that, because in the modern age we have very complex problems to solve, like pandemics, income inequality, threats from disinformation, cybersecurity problems, and by far the most global of them is the climate change.
VI
Speaking further about remote working, I would point out it is not only a question of working space and communication channels. That certainly calls for adaptation of skills, but that is not all. With the expansion of remote work, the whole concept of work and its content, the place and role of work in a person’s life changes in the sociological sense.
Let me remind that since ancient times people have worked in order to earn a living, but the understanding of the meaning and content of ‘work’ as we use it today, is closely linked to the rise of industrial capitalism into our economies, beginning with the eighteenth and especially nineteenth century. Thanks to the workers movements, trade unions, the situation of workers has continually improved.
These days it is regulated by labour laws. Modern labour laws that regulate working hours, vacation, relations with the employer, salaries, insurance, and many other work-related issues, are regulated in the European Union on two levels – the national and the EU level.
Labour laws form the legal framework for labour relations. However, they are rooted in the classical model of work – physical presence, full-time, with one employer. Of course, in recent years, given the changes in the real situation, labour laws have to some extent become more flexible.
However, they do not yet reflect sufficiently the situation of remote workers. Labour laws primarily insure workers against exploitation and protect their health. For example, what is the work schedule of an employee, how it is registered, whether the employer is allowed to communicate with an employee outside working hours, as well as insurance and many other specific issues.
So, as remote work becomes more widespread, the protection of employees must not decrease. The same applies to the self-employed or semi-independent workers. Their protection, especially against exploitation and self-exploitation, must be ensured.
In this context I will point out another problematic area regarding remote working. That is the question of living in one country, for example Latvia, and working remotely in another country, for example Germany, UK or Singapore. And vice-versa, of course.
Such opportunities to work remotely have become much more real. Yet how do rules for labour protection apply in such cases? In particular, has the taxation system adapted to such a situation? I know personally of several cases where companies refuse to employ suitable candidates living abroad, because they say it is too complicated.
In any case, if we speak about the future of employment, qualifications, and skills, and we see that remote work can and will be increasingly widespread, we need to involve a wider circle in the discussion – lawyers, government, parliament, who ought to turn without delay to the development of regulations covering remote work, so that the legal framework for labour relations does not create unnecessary complications that only slow down the economy. This applies both to the EU and the national legislator.
I urge in particular Latvia’s lawyers and lawmakers to be among the first in the EU to find a satisfactory legal solution to these issues. That would be a good, achievable challenge.
VII
Today you will hear an impressive line-up of speakers, both local and international. They are researchers, policymakers and practitioners who are in the fore-front of the changing landscape of work.
I sincerely hope that you will take away from today not only quality information and new ideas, but also become more inspired to be a part of the changing future of Latvia.
We live in times of reinvention and rapid change, but if anyone knows something about resilience and adapting to change, our people do.
We are able to contribute with our solutions.
I wish you all a good conferences and fruitful discussions!