This article is brought by the London School of Economics and Political Science (LSE) and written by Nathan Kornish.

Where are we now?

Over the course of the past few hundred years, the world has experienced three industrial revolutions. The first brought us large machines that replaced their human counterparts and alternative power sources like steam and water. The second brought us the mass production of steel and a slew of new technology like electricity and the telephone. Most recently, the third was the digital revolution which gave rise to cell phones, computers, and the internet. Each and every one of these revolutions drastically changed the way we live today. Industrial revolution was feared every time because of the worry that people would be replaced by machines, but history shows that machines are able to supplement humans work and allow our economy to grow. As we enter into the fourth industrial revolution we must remember this important trend. We do not know yet what products from the fourth industrial revolution will reshape society, but the proliferation of self-driving cars, machine learning, and the Internet of Things (IoT) will almost certainly transform civilization.

What will the 4th Industrial Revolution look like?

The foundation of the fourth industrial revolution will be an ever expanding networks of devices: smart cities will be able to predict and react to natural disasters, self driving cars will communicate to eliminate traffic, and the interaction with robots in everyday life will escalate. This will build off the the last industrial revolution where the internet changed many facets of day to day life like research, communication, and shopping.

Moore’s law states that the computing capacity of computer chips doubles every two years. Effectively, this means technology progresses exponentially, not linearly. This is why we have seen more technological advancement in the last 200 years than in the previous 2000 years of mankind’s existence. At this rate, the world we grew up in will look nothing like the world we grow old in. This is an exciting prospect in some respects, but a frightening thought for many.The foundation of the fourth industrial revolution will be an ever expanding networks of devices: smart cities will be able to predict and react to natural disasters, self driving cars will communicate to eliminate traffic, and the interaction with robots in everyday life will escalate. This will build off the the last industrial revolution where the internet changed many facets of day to day life like research, communication, and shopping.

Moore’s law states that the computing capacity of computer chips doubles every two years. Effectively, this means technology progresses exponentially, not linearly. This is why we have seen more technological advancement in the last 200 years than in the previous 2000 years of mankind’s existence. At this rate, the world we grew up in will look nothing like the world we grow old in. This is an exciting prospect in some respects, but a frightening thought for many.

What are the potential challenges?

Governments and bureaucracies are slow to react while technology is quick to spread. This could become a problem when governments fail to regulate new technologies. For instance, by the time BitCoin regulations were brought to the table, the cryptocurrency was past its prime. While unregulated sectors are an economic opportunity for some, they leave others exposed to abuse.

Another potential problem is increased income gaps with more advanced technologies. The people able to afford new and innovative tech are the wealthy while the poor are stuck in low pay, low skill jobs, unable to progress due to higher barriers to entry. The wealthy ones who are first able to take advantage of innovation will further separate themselves from the lower class.

Much like every industrial revolution before, people fear losing their jobs to automation. This is not unjustified, especially as robots become smarter and more accessible. A McKinsey study stated, “(By 2030) in about 60 percent of occupations, at least one-third of the constituent activities could be automated.” This is a scary outlook for the lower and middle class, but with the replacement of people by automation comes new opportunities. Jobs will be created through the research, investment, deployment, upkeep, and overwatch of new technology. Structural unemployment, the kind that occurs when an economy reorganizes, is not necessarily something to worry about, but something to welcome. This shift will also allow workers to retrain themselves to the new world of interconnected living. People need to be prepared for this development that is clearly on the horizon, and the best way to do this is educating themselves.

Summary

• Industrial revolutions have reshaped the way we live our day to day lives

• The 4th Industrial Revolution promises to bring automation, machine learning and the expansion of IoT

• There has been  more technological advancement in the last 200 years than in the previous 2000 years

• As automation becomes more prevalent in business, job markets will restructure to accommodate increased productivity and reduced reliance on people

• Digital skills will become increasingly valuable as robots and other technologies disrupt markets

By Nathan Kornish
The London School Of Economics