The Impact of ICTs on Latin America’s Employment Prospects
The purpose of this research is to determine the manner in which employment will evolve as a result of information and communication technologies. Prior research has shown that both communication and automation are displacing certain type of employment, mainly those with middle level skills. Given the evidence from countries with greater penetration of ICTS we expect Latin America to follow a similar path and potentially be negatively affected by the elimination of some professions.
Researchers that have analyzed the impact of ICTs on employment have found that there has been a gradual move from agriculture, to manufacturing and to services with service economies being the latest iteration in development. The economic prospects for these service economies, however, will depend on the composition of the service professions. Ideally we would want people to be employed in professions that require higher level skills as they will also entail higher incomes over some service professions that pay minimum wages.
ICTs are currently generating employment in the Latin American region and this is likely to remain the case for some years as these technologies make business and government operations more efficient.
In the long term, however, the problem for Latin America is that without “knowledge and innovation policies” that invest in education as well as in research and development the region may be relegated to providing simple services that pay low wages, potentially increasing poverty in the region.
Using statistics from the International Telecommunications Union, the World Bank and the International Labor organization this author developed a panel of 200 countries over a 20 year period to allow for comparisons across regions, specifically Europe with Latin America, and to determine if countries that have invested in education and R&D also benefited from service employment with higher level skills. The paper concludes with policy recommendations.