“Superstar” technology companies are hurting the global wage growth across industries, the Organisation for Economic Co-operation and Development said as part of its Wednesday report on a trend of rising employment that’s “overshadowed by unprecedented wage stagnation.” The group that monitors the majority of the Western economy estimates that close to 62-percent of all people aged 15 to 74 were employed at the end of 2017, with the figure being significant as it signals the first occasion on which there are more employed people in the West than there were before the global economic crisis of 2007 and 2008.
Traditionally disadvantaged groups such as immigrants and mothers with young children experienced particularly significant improvements in employment, but the wage growth in OECD countries now amounts to only 1.2-percent, a significant decline compared to 2.2 percentage points recorded prior to 2008, as per the same report. The extra money that used to be going toward pay rises is now being invested in technologies utilized by companies with fewer workers on average, with the main implication being that automation is not only eliminating certain jobs but is preventing others from being valued more highly. Countries whose economies largely relied on low-skilled work are hit the hardest, though the majority of those in the OECD area are now experiencing wage growth stagnation, the organization said.
A number of technology juggernauts such as Google previously proposed a large-scale effort to rethink education as the most reliable tool for combating the growing threat new automation solutions pose to existing jobs and while some investments in the field have already been made, such initiatives are likely to take years, whereas wage stagnation is now being widely interpreted as a problem that requires a more immediate response. OECD Secretary-General Ángel Gurría concluded countries around the world need to “help workers,” especially those with low-skilled and highly repetitive jobs, having acknowledged that education should be an important part of any efforts to do so but also not their only component.