How 5G will impact the future of work

Apple’s latest iPhone models, announced in mid-October, are the first smartphones built to connect with 5G networks. The promise of 5G, the latest major advance in cellular connectivity, is bringing everyone, everywhere, fast internet without wifi.

The implications are enormous. “[5G is] going to have a big impact on all sorts of industries from manufacturing to robotics to even self-driving cars,” said Will Knight from MIT Technology Review.

How will 5G impact the future of work? In reports from think tanks and talks from experts in the field, I found predictions that 5G will lead to job growth, better jobs, and reduced economic inequality.

An extremely brief intro to 5G

What is 5G? Basically, the promise of 5G is internet access with WiFi speeds (meaning you can, for example, download a two-hour movie in seconds) wherever you have cell service.

5G is the “fifth generation” of mobile networks. Muriel Médard, Professor of Electrical Engineering and Computer Science at MIT, informally defined 5G as a “suite of enabling technologies for ubiquitous communications.” Cellular service providers have been upgrading their antennas, cell towers, and frequency ranges since 2019 to expand and improve their cellular networks. Current 5G offerings are 20% faster than 4G LTE connection speeds and have much lower latency.

Considering the fact that 39% rural Americans don’t have access to the internet at all and only 65% of Americans’ home internet is fast enough for Zoom, widespread 5G represents a massive change in connectivity for most of the US.

Some journalists are encouraging people to keep their expectations in check. Right after the iPhone announcement, Brian X. Chen warned that 5G’s current technical limitations means the vast majority of America won’t see blazing-fast speeds anytime soon.

Three ways 5G is likely to impact the future of work

The Progressive Policy Institute recently released a report containing their predictions on how 5G will impact American labor over the next 15 years. PPI expects AT&T, Verizon, and T-Mobile to be “heading towards nationwide 5G networks by the end of 2020.” They argue, and we agree, that widespread remote work has intensified the need for wider internet access, including 5G.

1. More jobs

CNBC calls 5G “a catalyst for the next industrial revolution.” Bloomberg’s Nico Grant said there’s a “broad expectation” that 5G will significantly push the internet of things (IoT) forward. One obvious ramification is a greater proliferation of “smart” factories.

Currently, machines in factories send and receive data via slow, low-bandwidth, high latency disparate networks. 5G will likely replace technologies like Ethernet, WiFi, and 4G LTE, making it more cost-effective to buy and set up robots. The end result is likely smarter factories with more automation.

For example, 5G has transformed a new Ericsson factory in Lewisville, Texas. There, remote support personnel assist on-site workers via augmented reality and remote pilots guide automated guided vehicles (AGVs) and drones around the facility, all using 5G.

While there’s widespread concern that automation will drive salary decreases and job losses in the US, the data shows the relationship between automation and employment and wages isn’t straightforward. That’s because while automation does replace existing jobs, it also creates new jobs.

PPI expects the technological advancements that 5G will help facilitate are likely to lead to total employment gains, not losses. They expect that 15 years after networks introduced 5G in 2019 5G and related tech will create 4.6 million more jobs than the economy would have otherwise created. They point to the fact that companies created 106,000 jobs as of April/May 2020 just building out 5G.

PPI expects 5G to significantly boost employment in Agriculture, Construction, Utilities, Manufacturing, Transportation and Warehousing, Educational Services, Healthcare and Social Assistance, and Government.

Even though increasing automation is likely to have a positive effect on overall job growth, it’s important to keep in mind that it may also, according to McKinsey, “widen existing disparities between high-growth cities and struggling rural areas, and between high-wage workers and everyone else.”

2. Better jobs

PPI also expects the jobs created by 5G to be higher paying than the ones we’ll likely lose to automation. “In an important sense, 5G job creation is a countervailing force to job destruction from automation and globalization, and critically important in the post-COVID world,” the authors write.

Colleen Berube, Chief Information Officer at Zendesk said her company is focused on automation “at every turn.” She expects automation of rote work will help free up time for workers to focus on “higher order work” like analysis, strategic thinking, and creativity.

Engineers and software developers are going to be in especially high demand to make 5G a reality. Looking at roughly 50,000 job postings nationwide at the end of April, about 0.6% included the term “5G.” In late April and early May 2020 titles in job ads included “Engineer, Principal 5G Systems,” and “Wireless Core Engineer,” and “5G Wireless SME / Senior Systems Engineer Level 6.”

3. Reduced inequality

Economic inequality in America is growing and is the highest of all the G7 nations. Meanwhile, economic mobility in the US has been flat (or declining) for decades and is lower than similar countries.

The vast majority of new high-paying jobs go to high-skill workers like software developers. “Technologies have replaced workers on the shop floor and in clerical tasks and rote information processing, “Andrew McAfee told HBR. “By contrast, big data, analytics, and high-speed communications have enhanced the output of people with engineering, creative, and design skills and made them more valuable. The net effect has been to decrease the demand for low-skilled information workers while increasing the demand for highly skilled ones.”

PPI believes that 5G will create jobs which don’t fall neatly into lower paid “blue collar” or higher paid “white collar” jobs, but are instead “mixed ‘cognitive-physical’ skilled jobs.” We’ll need installers and maintainers to apply and connect the sensors that power 5G for physical industries, including agriculture, energy, construction, manufacturing, transportation, and healthcare.

The PPI authors claim that productivity gains from digitization will increase revenues, job quality, and international competitiveness for industries like manufacturing, construction, and healthcare. However, they also claim that productivity gains will lead to faster wage gains. But that analysis seems to ignore how productivity and wage gains have split apart in America since the 1980s.

How to prepare for a 5G world

Even if 5G will create higher quality jobs available to workers at all skill levels it’s not a bad idea to keep your tech skills sharp. When asked how 5G and automation impacts hiring decisions, Berube said Zendesk is always looking for candidates with both domain expertise and technical proficiency. Southwick echoed Berube, saying that when Pure Storage is evaluating candidates, hard skills are “table stakes.” In addition they’re looking for workers with “hybrid capabilities.” For example, a hardware engineer who can also write software.

It’s also important to remain cognitively flexible and keep abreast of new technologies. “We’ve enhanced how we think about hiring to also include soft skills,” Berube said. Zendesk is looking for workers who are comfortable with change and who are resourceful when solving problems.