Staying ahead as train moves faster

The rise of robots, leaps in artificial intelligence and 3D printing becoming more widely used have sparked a debate over the implications of what has been called the Fourth Industrial Revolution by Professor Klaus Schwab, founder and executive chairman of the World Economic Forum. In Singapore last week for a series of talks with business and government leaders, he sat down last Tuesday with Straits Times editor Warren Fernandez to discuss what the future might hold.

Professor Klaus Schwab feels the world is not sufficiently prepared for the Fourth Industrial Revolution. "We need to be much more agile," he says. Some countries - such as Germany, South Korea and Singapore - which have recognised the opportunities,
Professor Klaus Schwab feels the world is not sufficiently prepared for the Fourth Industrial Revolution. "We need to be much more agile," he says. Some countries - such as Germany, South Korea and Singapore - which have recognised the opportunities, are moving much faster, while some countries have the feeling of being left behind, he says. ST PHOTO: MARK CHEONG

Q. At this year's forum in Davos, it was fascinating to see the way you brought robots and 3D printers into the conference centre so that delegates could see for themselves how fast things are changing. What prompted you to do that?

A. Yes, when you look at the Fourth Industrial Revolution, we feel that the world is not sufficiently prepared for it. We need to be much more agile; the speed of technological development is so fast that governments cannot create the necessary regulatory infrastructure.

Q. Much of what you're discussing in your book on the Fourth Industrial Revolution as well as at your recent World Economic Forum events is very much what Singapore's Committee on the Future Economy is grappling with. If you were to address that committee, what would you ask them to think about?

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A. We all want to use the opportunities arising from the Fourth Industrial Revolution, and I think Singapore is well aware of the opportunities that exist.

But we have to look at the social consequences. And here social inclusion is key for Singapore. And what worries me is not so much the social inclusion inside the country. I think Singapore, with its education system and so on, can ensure such a gap is not widening too much. But it's the gap which will develop between Singapore and its neighbouring countries. That would be one thing to worry about.

Secondly, I would really look at how Singapore might have, say 10 years ago, made a decision to put a lot of emphasis on bio-research and so on. But I think from a strategic point of view, a key capability for the future will be artificial intelligence. It's important; it's really the heart of many production technologies, but also defence technologies as well.

Professor Klaus Schwab feels the world is not sufficiently prepared for the Fourth Industrial Revolution. "We need to be much more agile," he says. Some countries - such as Germany, South Korea and Singapore - which have recognised the opportunities, are moving much faster, while some countries have the feeling of being left behind, he says. ST PHOTO: MARK CHEONG

Q. To what extent do the widening gaps that you mention, both within the country and between countries, explain some recent developments like the support for Mr Donald Trump in the United States and the support for Brexit in the United Kingdom?

A. We see it in statistics. If you look at the US, the real income or purchasing power of the middle class has decreased. If you look at jobless rates, again that of the American middle class, it has increased.

But even if you have jobs and housing, job security has become very precarious. So until now, people could look to the future in a relatively secure way, but that's no longer the case. And there are not just social consequences, but also political consequences, which you see in today's rise of what I would call "demagogic voices".

Q. There has been much talk lately about the rise of robotics, artificial intelligence and 3D printing. What implications do these have for the future of work and jobs? When you think about the future, what, in your mind, is work going to look like?

A. We don't know yet. I believe in the principle of Schumpeter, of creative destruction. So I'm sure there will be new jobs, whether it is drone dispatchers or robot polishers or whatever else you can imagine. So we will have new jobs.

But contrary to the previous industrial revolutions, we do not have a lot of time because the new industrial revolution is coming much faster compared to the last ones.

And we do not know yet what skills we need in the future. I would say we need more emphasis on the interaction between man and digital technology. This means that if I were to design a school system, I would probably add computer programming. Because if you have to do programming, I think you will understand what's going on.

And the other area I think we have to develop is contextual intelligence, which means it's not so much that you are an expert in one specific area, but you need to be able to link the dots...

This requires a foundation in the humanities. It's contradictory, to a certain extent, to what you might think we need for the next industrial revolution, where technology is very much the key. But in order to master technology, it's very important to emphasise the human dimension. As Eric Schmidt (executive chairman of Alphabet Inc) said at a session in Davos, how do we human beings compete against robots? If you want to win this battle, we have to cultivate what makes human beings human.

Q. In Singapore, we have been discussing how to prepare for this and there has been much discussion about transforming the education system here, to make it more of a lifelong process, and changing the university system so that you don't just go there for a few years at the start of your career, but return to it constantly, throughout your career.

A. Yes, I learnt about this yesterday. Coming from Switzerland, we have the same system.

In the military in Switzerland, you have to go back for a certain time... And I think this would also be the university system of the future.

You already have, for example, in the United States, for specific medical professions, you have to take an exam on a yearly or regular basis to be certified as an upgraded professional. I think such will be the future. The teaching may not come from what we are used to, lectures and so on. I think it will be very much influenced by e-learning and some form of video, or virtual reality, where you can simulate a classroom setting.

Q. Could I ask you about the recent debate in Switzerland about a universal basic income? Swiss voters rejected this in a referendum, but do you think some form of this might be conceivable, or even necessary, in the future?

A. I think there are two aspects. I have to say as a normal citizen, particularly coming from Calvinistic Geneva, I would say people have to work to earn their living. But, maybe in 20 years, we will just not have enough work for everyone.

And perhaps in the future, what we will have is demand for low-skilled jobs in the social sector. You have to take care of the elderly who have medical problems and so on. Now, if you do it on the basis of paying minimum wages to these workers, I think they will feel exploited.

But if you give each of them a basic contribution, no obligation attached, most of those people will look for some meaningful purpose in their life. They may do the same job on a voluntary basis, but with much more satisfaction because they feel they are volunteers and they still have the freedom.

I imagine that if we discuss the same issue in 10 to 20 years, we should have a more positive approach to it, but now it's certainly premature.

Q. You travel around the world meeting business and government leaders. What is topmost on their minds when you discuss the Fourth Industrial Revolution?

A. I think it's the impact on jobs. And certainly you can make a differentiation - in developed countries, it's the impact on the middle class, which leads to erosion of popular support in a democracy. And in emerging countries, it is the fear that with the Fourth Industrial Revolution, the gap, the speed at which some countries are moving ahead.

Some countries, like Germany, South Korea and Singapore, which have recognised the opportunities, are moving much faster.

It's a train, it's accelerating, and some countries have the feeling of being left behind.

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A version of this article appeared in the print edition of The Sunday Times on June 26, 2016, with the headline Staying ahead as train moves faster. Subscribe