BUSINESS24 | MONDAY FEBRUARY 17, 2020
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Feature
Making technology work for workers By Shamina Singh
For workers, coping with the rapid technology-driven transformation of labor markets, without sacrificing dignity, autonomy, or ambition, will require a combination of economic mobility and financial security that can be delivered through a new kind of social safety net – one that puts benefits squarely in the hands of the individual. As technological innovation transforms our economies, workers all over the world are doing whatever it takes – whether crossing borders, changing jobs, or starting businesses – for a chance to thrive. Yet, social safety nets have been much slower to change, meaning that workers in transition are often highly vulnerable. What will it take to safeguard workers in the labor market of the future? In the not-too-distant past, most workers were employed in the same industry – often at the same company – for most of their careers. But today, nearly 40% of employed people in the European Union are in atypical employment (not working under a full-time, open-ended contract) or self-employed. The average working-age American today will hold 11 jobs over their lifetime, with many working multiple jobs at once. Globally, the McKinsey Global Institute estimates that
by 2030, up to 375 million workers (14% of the workforce) will need to switch occupational categories in order to meet the needs of a shifting labor market. Moreover, all workers will need to adapt – acquiring new knowledge and skills – as their jobs evolve alongside increasingly capable machines. If automation will shape the future of work, life-long learning will determine the future of workers, especially as workers’ lives become longer. Coping with these changes, without sacrificing dignity, autonomy, or ambition, will require a combination of economic mobility and financial security that can be delivered through a new kind of social safety net – one that puts benefits squarely in the hands of the individual. Workers should not have to choose between facing a period of severe vulnerability as they shift occupations and clinging to the same job until it becomes obsolete, just so they do not lose their benefits. Just as technology is disrupting their work lives, it can ensure that they are protected by enabling the delivery of benefits that accrue over a person’s working life, regardless of the type of work they do or where in the world they do it. Some governments are already responding to this imperative. In 2015, France established individual training accounts for all private-sector workers, accessible from when
they first join the labor market to when they retire. Every employee receives 24 hours of training per year of full-time work until they reach a threshold of 120 hours, at which point they receive 12 hours per year of training. More recently, Singapore created “individual learning accounts” for each citizen over age 24. Account balances can be spent on skills training from approved providers. Similar models have been proposed in Canada, China, and Egypt. In the United States, legislators in a handful of states and cities are drafting bills to test and fund portable benefits. But, the responsibility for developing universal portable benefits cannot fall only on governments. The private sector must also help to ensure that all workers – from the migrant to the miner to the marketing professional – have access to the tools and services they need to achieve financial security today and remain agile and productive throughout their lives. Fortunately, progress is being made here, too, with some startups offering the kind of people-centered tech that will underpin the social safety nets of the future. For example, Trezeo developed a bank account that, using artificial intelligence, provides interest-free loans and ensures consistent pay for independent workers, even during slow periods.
Shamina Singh
France’s Bob Emploi uses AI and government data to provide job seekers with personalized assessments of their prospects. To encourage continued progress, Mastercard has joined with the Royal Society for the encouragement of Arts, Manufactures and Commerce Future Work Centre to create the Economic Security Impact Accelerator. The partnership – which aims to facilitate the development and deployment of innovative initiatives that directly promote good work and civic inclusion, while ensuring secure and reliable household incomes – shows how private-sector actors can come together and discover new ways of working by leveraging their technology and knowhow. We have seen firsthand the impact of such joint projects. Jaza Duka – a partnership among Mastercard, Unilever, and Kenya Commercial Bank – is a digital platform that, since
its introduction in 2017, has been helping to ensure that small merchants have access to the working capital they need to compete and grow. But, developing such a program in one market is only the first step. A common framework must also be created so that such programs can be scaled up and implemented in different contexts. For example, delivering benefit “points,” rather than money denominated in a particular currency, would allow schemes to operate across borders at a time when workers increasingly need to do the same. And standardized educational credentials would retain their value as they moved with those who have earned them. As the nature of work changes, so must the nature of benefit systems. To deliver opportunities and security to everyone, everywhere at a time of widespread technological disruption, governments and private-sector actors must work together to advance innovative solutions that meet the urgent and evolving needs of workers. The best way to do this is by taking advantage of the very technologies that are causing the upheaval.
Shamina Singh is President of the Center for Inclusive Growth, Mastercard’s philanthropic hub, and Executive Vice President of Sustainability at Mastercard
Trump’s Travel Ban Benefits Only China By Cobus van Staden
Overwhelmed by the coronavirus panic, US President Donald Trump’s impeachment folderol, and the chaotic Iowa Democratic caucuses, few took notice of the Trump administration’s announcement that it will expand its controversial 2017 travel ban to six more countries, including four in Africa. It is a politically expedient move that will do nothing to make Americans safer – and will help a country that the Trump’s own White House describes as a “strategic competitor.” Trump’s original policy, unveiled in 2017, barred travelers from Iran, Libya, North Korea, Somalia, Syria, Venezuela, and Yemen from entering the United States. The expanded version prohibits anyone from Eritrea, Kyrgyzstan, Myanmar, and Nigeria from applying to live and work in the US, and blocks Sudanese and Tanzanians from participating in the Diversity Visa Program, the annual green card lottery created to boost immigration from underrepresented countries. The Trump administration claimed that the 2017 ban was needed to protect Americans from Islamist terrorism. Its justification for the ban’s expansion is “information-sharing deficiencies and national security risk factors,” such as lapses in tracking suspected terrorists. But, just as Trump’s border
wall is unlikely to stop inflows of undocumented migrants from Central and South America, the travel ban never had much potential to make Americans safer. None of the 14 most significant terrorist attacks or attempted attacks on US territory in the last quarter-century would have been prevented by it. The expanded travel ban is about politics, not security. An election looms, and Trump wants to boost his approval ratings. The expanded travel ban – with its blatantly racist undertones – is red meat for Trump’s Republican base. Trump’s disdain for African countries is well documented. In 2018, he reportedly referred to them – as well as Haiti and El Salvador – as “shithole countries,” suggesting that the US should instead attract more immigrants from countries like Norway. The previous year, he commented that, once Nigerians get to the US, they will never “go back to their huts” in Africa. Since then, the Trump administration has worked actively to restrict immigration from Nigeria. In 2018, the US denied 57% of Nigerian applications for short-term visas – among the highest denial rates for any country. The revamped travel ban cements this pattern as the long-term default, making it almost impossible for Nigerians to emigrate to or work in the US. The targeting of Nigeria is baffling. Statistically, Nigerians
are model immigrants: 59% of Nigerian immigrants to the US have bachelor degrees or higher (compared to 31% of the total US population); Nigerians contributed more than $500 million to the US education system last year; and Nigerian businesses invested $75 million in the US in 2018. Moreover, the Nigerian diaspora in the US has led to strengthened diplomatic ties between the two countries. Nigeria is also among America’s key African partners in the fight against terrorism. And as Africa’s most populous country and largest economy, Nigeria has a crucial role to play in the Trump administration’s “Prosper Africa” initiative, which aims to unlock business opportunities on the continent. By preventing Nigerians from securing work and residency visas, the Trump administration will undermine Nigeria’s prosperity. The country’s tech sector will be hit particularly hard. It was supposed to be a powerful engine of Nigerian growth and development: last year, venture capital investment in the Africa tech sector exceeded $1 billion for the first time, with Nigeria receiving the lion’s share. But continued progress depends on exchanges with the US, which Trump’s new rules will significantly impede. Prosper Africa was never only about economics. As then-National Security Adviser John Bolton noted in 2018, the ini-
tiative is also supposed to help counter China’s rapidly expanding influence on the continent. Nowhere is that influence more apparent than in Nigeria. Last year, two Nigerian fintech startups, OPay and PalmPay, together received $210 million in Chinese venture capital. China is also a major buyer of Nigerian oil, and a major supplier of communications satellites, 5G networks, and armed drones. China is now financing a $3.9 billion railway project between Abuja and the Nigerian coast, a $7 billion rail link between Lagos and Kano, and several road projects, including a trans-Sahara highway connecting Nigeria with five other countries. The effects of China’s soft-power offensive extend beyond economics. For example, Nigeria’s government is currently considering draft legislation that, following the Chinese model, would restrict free speech on social media. If the US wants to counter Chinese influence in Africa, greater engagement with Nigeria seems like a no-brainer. But that would mean taking Nigeria’s development ambitions seriously and engaging with actual Nigerian businesspeople, graduate students, and civic leaders. The US may claim that it wants to focus on “trade not aid” in Africa, but the expanded travel ban makes this kind of long-term strategy considerably harder to execute. Instead, the ban is perpetuating a racist stereotype of Africa
Cobus van Staden
as a burdensome charity case. For Africans, the travel ban is America’s, not Trump’s. It is America that is rejecting them. China has no such problem with African promise, talent, and money. And it is more than happy to swoop in to capitalize on what the US has abandoned. But that won’t help Africans who hoped to work – or join their families – in the US. The Trump administration has systematically – and perhaps permanently – shattered Africans’ perceptions of the US as a land of freedom, justice, and opportunity. As Africans increasingly turn to China for trade and financing, they will not simply redirect their hopes there. They will remember America’s rejection for the rest of their lives. Cobus van Staden is a senior foreign policy researcher at the South African Institute of International Affairs. © Project Syndicate
