The Impacts of Globalization and Technological Advancement
The incomes and general well-being of people around the world have improved as a result of globalization and technological advancement. Although it has gained increasing attention in the recent three years, globalization has roots in the nineteenth century, during the time of Karl Marx (Dicken, 2007).
The Advantages of Digitization
The advantages of digitization include easier access to services and other items at cheaper search and transaction costs. Additionally, efficiency and convenience are boosted because business owners may sell their items, check client reviews, and advertise online (Dicken, 2007).
Challenges and Income Inequality
However, there have been a number of problems with regards to job losses, relocation, and persistent marginalization. Income inequality is becoming a big concern in the world due to the big gap between the rich and the poor. Consequently, several bodies have shown interest in coming up with possible solutions that can help to reduce such challenges. Some of organizations include labor movements, states, firms, GCSES which ensure that more workers remain viable in a globalized society. The factor that is the most relevant in explaining the mentioned outcomes is accelerating technological change by making many skills, tools, and knowledge obsolete.
The Role of Technology in Income Inequality
Technology is widening the gap between the rich and the poor creating a wide income inequality gap across the world. Demand for skilled labor has a big adverse impact on the distribution of incomes in every part of the globe including the developing ones. People with inadequate skills are left unemployed or are forced to do low-paying jobs to sustain their lives. Technological advancement is associated with high growth thus any income disparities arise due to unequal increase in acquisition of higher skills by individuals.
Those with advanced technological knowledge are at a greater advantage since they are highly sourced for job opportunities especially the high-paying ones. Individuals with low skills end up unemployed or do jobs that do not require application of modern technology.
High-tech sectors have firms that are highly digitized and mostly collaborate with suppliers to ensure high-quality products (Shearmur, 2012). Such firms may be forced to employ only individuals that have skills in certain fields. The people that are employed in positions, which fetch huge incomes such as IT managers, Web designers, and automation among others compared to the ones that take other jobs such as field managers. Again, owners and top employees of huge technological organizations such as Google, Facebook, Samsung, Apple, and others earn huge incomes. Therefore, technology is one major factor associated with increased income inequality gap in the globe.
Job Displacement and Technological Advancement
Job displacement can be defined as involuntary loss of jobs due to economic factors such as economic recessions, restructuring, and technology. Technology of a major factor causing displacement of jobs in the globe leading to increased job loss.
For instance, automation is leading to massive loss of jobs as machines replace human labor in areas such as medicine, industries, and other fields. Use of robots is on the increase in which software is replacing human beings especially in automotive manufacturing industries. Rapid technological development has been leading to massive job losses instead of creating them (Dicken, 2007). This in turn leads to stagnation of economic growth and increasing growth of inequality in countries including the United States.
There are many modern automotive plants, which are run by robots leading to decreased demand for human labor. Automated robots tasks such as painting, which were once performed by human beings displacing human labor, do. Computer technology is changing the type and nature of jobs available. They have taken over tasks such as clerical work, bookkeeping, and other production jobs in various sectors. Only jobs that are not possible to automate such as janitors, restaurant workers, and home health have increased. Technology has destroyed some types of jobs while creating new ones in the markets.
Digital Exclusion and Inequalities
Digital exclusion results from social and cultural, gender, age, education, and class affiliation of individuals. It creates inequalities in accessing technology due to asymmetrical distribution of economic resources such as money, social relations, skills, capital, and power. These create structural inequalities due to lack of experience in the emerging technological developments. For instance, the internet has a big relationship with social inequality since some people have a problem of accessing online platforms. This has led to social inequalities due to the wide gap existing between proficient internet users and others with little knowledge.
In addition, unequal access to internet networks and information leads to establishment of class structures. The introduction of 3G and 4G internet is aimed at promoting reliable internet access and bridge the inequity gap (Dicken, 2007). The newest form of social inequality is the digital divide creating social gap due to difficulties in accessing internet technology or inadequate knowledge about hardware and software. It happens when one section of the population can access the internet while the other while the other has none. Digital inequity is common as people are immigrating into cyberspace and communication technology is becoming quite important. However, digital equity has not been achieved leading to social inclusion of some individuals such as the aged, uneducated, and low-income earners who may not afford the cost associated with digitization. Low digital literacy can also be blamed for digital exclusion especially for senior citizens. Such groups may want to be in digital forums and share online with friends but may not have adequate knowledge about the internet. Computer illiteracy can be blamed for the problem leading to suffering since the affected individuals have to seek for assistance even when dealing with tax issues. People with disabilities suffer more since they are always disadvantaged and may not be able to access the internet due to incomes.
Solutions to Globalization and Technological Advancement Challenges
The problems caused by globalization can be solved through increased investments as emphasized by Keynes especially ones that encourage innovativeness (Mazzucato, 2015). Firms should ensure continuous innovation and involve the employees in creation of high-quality products. Companies such as Apple have been innovative for its production of several products and are considered as one of the frontiers of digital revolution and consumer electronics.
Another major measure is by states creating rules that welcome international entrepreneurs such as immigrant workers. Nations should regulate communication to promote utilization of the most recent technology. For instance, America through its citizenship and immigration services (USCIS) proposes a new rule to enable international businesspersons to have temporary permission to live in the US and start small businesses (USCIS Proposes Rule to Welcome International Entrepreneurs, 2017). The country can benefit a lot from utilizing foreign workers living in the country doing business in areas such as the Main Street and Silicon Valley. Entrepreneurs need to think globally to reduce cases of digital exclusion, reduce wealth gap, and lower the rates of job displacements.
Firms have a responsibility of ensuring in-job training to promote the skills of the employees for increased productivity. Instead of replacing their staff with the ones with modern technology, they should have refresher courses that keep their staff up-to-date with the latest technology. Organizations such as Telecommunication Civil Aviation Organization and the International Telecommunication union have roles of regulating global communication to enable establishment of global trading companies. These can create many jobs and help in minimizing the challenge of unemployment, job displacement, as well as digital exclusion. Spreading ranches over several countries helps in growth of business empires as well as solving major global challenges.
Conclusion
Globalization and technological advancement have promoted development and economic growth in various countries. However, several problems have also emerged due to unequal distribution of resources. For instance, technology has caused loss of jobs for some groups and job displacement especially those with inadequate technological knowledge. In areas with poor network underdevelopment, there is digital exclusion of some people since some cannot afford gadget that can allow them to be connected while others find it difficult to connect to the internet. Globalization and technological advancement are also causing income inequality in the globe. However, immigrants and improvement of communication among others can address the issues through measures such as promoting entrepreneurship.
References
Brynjolfsson, E., & McAfee, A. (2014). The Second Machine Age: Work. Progress, and Prosperity in a Time of Brilliant Technologies, New York.
Dicken, P. (2007). Global shift: Mapping the changing contours of the World Economy. SAGE Publications Ltd.
Mazzucato, M. (2015). The Entrepreneurial State: Debunking Public Vs. Private Sector Myths (Vol. 1). Anthem Press.
Shearmur, R. (2012). Not being There: Why Local Innovation is not (always) related to Local Factors. Foundations of the Knowledge Economy: Innovation, Learning and Clusters, 117-139.
USCIS Proposes Rule to Welcome International Entrepreneurs (2017). https://www.uscis.gov/news/news-releases/uscis-proposes-rule-to-welcome-international-entrepreneurs
