Though considered as an up-gradation of the third industrial revolution, this is particularly a fusion of technologies; a sound, promising, affluent, and visionary and altogether different revolution coming up soon!
The First Industrial Revolution came up to mechanize production using water and steam power, while the Second Industrial Revolution started to create mass production. Automated production using electronics and information technology was the mission of the Third One. The awaiting transformation cannot be considered as a prolongation of the Third Industrial Revolution due to its disruptive propagation, exponential evolution and a speed transformation with no historical precedent.
What is the Fourth Industrial Revolution?
We are at the brink of technological innovation; a change; a surreal transformation! According to World Economic Forum (WEF) founder and executive chairman Klaus Schwab, as a
“technological revolution that will fundamentally alter the way we live, work and relate to one another”
The soon-to-happen and highly awaited Fourth Industrial Revolution combines digital, biological and physical systems and will propagate a new interaction between humans and machines. Built upon the first three Industrial Revolutions, this will prove the rapid speed of technological progress by fusing their boundaries.
Artificial Intelligence (AI) will rule the Fourth Industrial Revolution!
Technological innovation will be the best and the promising part of this phase of the Industrial Revolution. Driverless cars, smart robotics, 3D printing, autonomous vehicles, nanotechnology, biotechnology, digital fabrication, synthetic biology, computation design, energy storage, quantum computing and the Internet of Things will be the milestones set in the Fourth Industrial Revolution. A WEF paper by Nicholas Davis, Head of Society and Innovation says that,
“reliant on the technologies and infrastructure of the third industrial revolution… , represent entirely new ways, in which technology becomes embedded within societies and even our human bodies. The new ways include genome editing, new forms of machine intelligence, and breakthrough approaches to governance that relies on cryptographic methods such as block chain”.
Why is this buzz about the Fourth Industrial Revolution?
Because there are both massive opportunities and grave challenges!
Skills will rule the Labour Market!
One of the biggest and direct impacts of the Fourth Industrial Revolution will be felt by the labour market. The increasing technological invasion will lead to a large tranche of job losses, especially for low- skill jobs. There will be high demand for high-skill jobs. You will definitely smart coders for driverless cars, isn’t it? According to economists Erik Brynjolfsson and Andrew McAfee, there will be a rise in inequality in the labour market. Larger technological automation will lead to the net displacement of workers and subsequently an increase in the growth and demand of safe and rewarding jobs. Oxfam estimated that just 62 individuals own as much as the poorer half of the world’s population and that the wealth of the poorest 50 per cent fell by 41 per cent since 2010.
A report by the Swiss bank UBS said that the spread of AI and Robotics will harm economies like India and some Latin American countries by cutting their cheap labour advantage. Earlier, researchers at Oxford had estimated that 35 per cent of workers in the UK and 47 per cent in the US can lose their jobs to technology over the next two decades. Hence the labour market will go like this: “high skill-high demand-high pay” and “low skill-low demand-low pay”. In other words, talent will acquire a bigger space and will be much in demand in the labour market than the capital during the Fourth Industrial Revolution.
Improvise the Quality of Living
Technology has improvised the quality of life for populations since its inception. Availability of new products, easier accessibility to market, increased efficiency and pleasure of personal lives and an affordable digital world awaits ahead. Starting from high end crucial daily requirements like making a transaction, buying a product till casual personal needs like listening to music or watching a movie; will be done remotely and easily. The Fourth Industrial Revolution will indeed result in a qualitative transformation in the life of people.
Tremendous Gain in Efficiency and Productivity
Needless to say that automation and technological innovation will cause a miracle in terms of efficiency and productivity. Long term gains are assured. Drop in the transportation and communication costs, increased effectiveness of logistics and global supply chains and reduced cost of trade will gear up the economic growth as well as propel new markets to open up. It is easier to run trade with fewer workers today than it was half a quarter of a century ago. A company can earn good money with a smart app with a minimum requirement of capital leave alone the storage, logistics and transportation charges. Explaining in terms of economics jargon, marginal costs per unit of output will tend to zero and Return-of-Investment will be on a higher side; abruptly higher!
Impact on Business World; Can be a reliable promise as well as a fatal peril!
The Fourth Industrial Revolution will however mark a major impact on the business world. Development and prosperity will rest on four platforms: customer expectations, on product enhancement, on collaborative innovation, and on organizational forms. Customers will form the epicentre of the business. Increased digital transparency in the business sector will lead to a major change in the world of customer experiences, data-based services, and asset performance. The rise of new global niches and business models will definitely need a makeover and re-touch of the existing talent, culture, and organizational forms. Business leaders need to understand their changing environment, challenge the assumptions of their operating teams, and relentlessly and continuously innovate to be in the changing league.
Grave Challenge Ahead for Governments
What will happen if citizens voice their opinions and circumvent the work of the government? A serious approach to public engagement and policymaking should be started! And this is what is going to happen very soon in the age of Fourth Industrial Revolution. Rapid digitisation will enable the citizens to opine more about the work of the Government subsequently putting more pressure on the latter due to redistribution and decentralization of power. Agile governance is the need of the hour. To do so, governments and regulatory agencies will need to collaborate closely with business and civil society. Technology can increase the risk of new fears related to warfare at the same time it will also create the potential to reduce the scale or impact of violence, through the development of new modes of protection, for example, or greater precision in targeting.
Female mass will have a prominent part in this revolution
Negative effect on the labour market can have a disproportionately negative impact on women than men. However, with the increasing female talent pool, the proportion of women expected to progress to medium and senior roles by 2020 is set to rise by nearly 10%. Job loss due to automation of technology will affect women and men relatively equally. However, the fact that women make up a smaller share of the workforce means that today’s economic gender gap may widen even further.
According to The Industry Gender Gap Report,
“The Media, Entertainment and Information sector is the only one that will see a reduction in the number of women in the next five years, with female composition expected to drop across all job levels, from 47% to 46%. However even here, women can expect to see more opportunity, with the proportion of women in mid-level and senior-level positions expected to grow from 25% in each today to 32% and 33% respectively”.
When will be the onset of the Fourth Industrial Revolution?
Resting upon the Third Industrial Revolution, the fourth is waiting for a major disruptor to mark its inception. A lot of instabilities and unpredictability are associated with the onset of this new digital revolution. A possible change in the Smartphone industry or just any new technological innovation that will wipe down the current technical aspects will mark the beginning of the Fourth Industrial Revolution. An invention that will “robotize” humanity will set the Fourth Industrial Revolution.
How will the Fourth Industrial Revolution affect India?
- It will affect the cheap and unskilled labour market of India. According to a UBS report, “Automation will continue to put downward pressure on the wages of the low skilled and is starting to impinge on the employment prospects of middle-skilled workers. By contrast, the potential returns to highly skilled and more adaptable workers are increasing.”
- There will be a need to upgrade the skills and invest heavily in skilling initiatives. “The greatest disruption, however, could be experienced by workers who have so far felt immune to robotic competition, namely those in middle-skill professions,” the UBS report says.
- Indian governance will face a major challenge to work on dynamic real-time data. However, there will be an increase in transparency especially in notoriously opaque sectors like real estate. There will be the use of eWallets than cash.
- Induction of 4G connectivity will enable Massive Open Online Courses (MOOCs) for the small town and village youths and help to merchandise the agricultural products at the right price.
- There can be a potential side effect of increased connectivity as well. “Connectivity increases the risks posed by cyber threats and the magnitude of these threats rises further as a result of networks becoming more connected. Extreme connectivity also fosters geopolitical tensions, as it increases the ability of diverse groups to organise and protest,” noted the UBS.
- Age of 3D printing will increase India’s investment in space research. 3D printing can help to build space satellites easily.
- A progressive tax regime will render equity.