New Technologies, Potential Unemployment and ‘Nescience Economy’ in the Russian Regions

Abstract

The use of unmanned technologies can cause a decrease in the level of employment. The article discusses the compensation mechanisms and conflicting results of empirical studies. Using internationally comparable methods, we estimated that approximately 27.6% of employees work in professions with a high probability of automation (Frey, Osborne, 2017), and about 44% of the workers in Russia (≈20.2 million) are engaged in routine, potentially automated activities (Manyika et al, 2017). These values are lower than in most developed and developing countries, although we expected them higher because of much lower labour productivity in Russia. In the regions, specializing in the manufacturing industry, the second value is higher; the lowest proportion of workers are at risk of automation in the largest agglomerations with high share of digital economy and in the least developed regions with large informal sector. We proposed a methodology to take into account informal employment and constant unemployment rate. Long-term mismatch between the exponential increase in automation rate, the compensating effect of retraining and new jobs creation is possible. Some people will not be ready for a life-long learning, development of new ideas, technologies and products, competition with robots, and accordingly there is a possibility of their technological or even social exclusion in the future. The term ‘nescience economy’ was proposed to describe these processes. Using an econometric model, we identified factors that reduce these risks in the regions: a high concentration of human capital, favourable institutional conditions for entrepreneurship, a low level of inequality, and the development of ICT infrastructure.