Process of change is leaving many Dominicans out of jobs

Regarding species, Darwin said it early on when referring to evolution: “Only the best will survive,” labor innovations in the country leave more and more people without opportunities to join productive activities due to structural flaws tied to the past. The level of education must be in line with the times of unemployment and low-paying underemployment “will take care of you,” with 85% of Dominican companies suffering from the shortage of skilled labor.

Competitiveness tends to stagnate nationally, hindering investment and growth in labor demand because, after the meager fruits of 4% of GDP for education, the educational system excludes many Dominicans from proper training. It also forces sources of employment to hire workers without adequate knowledge to increase productivity and profitability for their benefit and that of their employees.

The director general of the International Labor Organization (ILO), Gilbert Houngbo, has just said in the country that one of the most significant concerns worldwide is the labor informality that marginalizes workers from social protection. His diagnosis for the Dominican Republic: mechanisms are needed to protect the employees of small and medium enterprises. The smallest means of production are the ones that generate the most jobs worldwide. Unprotecting them fosters poverty and unemployment.

The “good news” that at the end of the year, inflation would have decreased to 4.00%, the lowest since July 2020, says little socially speaking because even if the increases lose intensity, the minimum and average incomes of the broadest part of the population do not cover to satisfaction the different levels of the cost of living that have no return, and that marginalize from consumption a large sector of the people. The low quality of education increases unemployment.

Tough competition
The lack of regulations to protect entrepreneurs and low-income employers, implicitly denounced by the ILO, was expressed this week with the alarm of the retail grocery sector, which feels cornered by the growing presence of large establishments that show the power conferred by the economy of scale to dominate the market.

They say they are suffering heavy losses due to the absence of a Commercial Code that geographically restricts the emergence of high-volume businesses. “Mega-stores” that, with no distance limit between them, are detrimental to small stores, for which they claim to follow the example of the United States that, using firm rules, prevents the big ones from devouring the small ones, thus closing the way to predominance and monopolies of influential corporate names.

Retailers claim credit for being – as is logical due to the ad infinitum dissemination of grocery stores – greater providers of jobs than their mega competitors. They recalled that during the pandemic, “we provided unlimited services without considering the risks of falling ill with the dreaded virus.”

In the same vein, representatives of the pharmaceutical sector and small drug suppliers denounced this week the Dominican Republic as a “country lagging in regulations for the pharmaceutical industry,” which would be allowing large firms in the sector to distort the market and prices to the detriment of the independent pharmacies scattered throughout the national territory providing vital services to the communities and putting people to work.

DR is at a disadvantage.
As a result of the fact that “the educational and technological precariousness of the Dominican labor force” began to be felt in the country around this time, economic editor Carmen Carvajal predicted that the low availability of qualified workers would discourage companies from investing in new technologies, “thus reducing the country’s possibilities of competing” in free trade agreements.

Citing a World Bank study, he noted that while foreign investors considered Dominican labor to be cost-competitive, the skills of workers essential for success have a slight quality advantage over those of other countries.

And indeed, a “Trade and Labor Competitiveness Assessment” applied to poverty reduction in the region to which the Dominican Republic belongs established that the average local labor force profile does not meet the demands of higher value-added manufacturing and service industries.

In light of the findings, a pressing message was sent to the Dominican economy in particular: “A greater availability of skilled workers would create incentives for companies to invest in new technologies that require skilled skills ( ) for which extensive educational improvements including full access to secondary education would be irreplaceable.”

Unfriendly intelligence?
Introducing software miming human behavior and learning patterns augurs devastating effects for performance areas such as call centers, which recently experienced an expansion in the Dominican Republic. But this technological and efficiency novelty has the days numbered for thousands of jobs by making employers see that it can replace the human being advantageously in providing customer services without the additional fixed cost of wages. Production line automation had already dehumanized industrialization phases in many areas.

Likely, the technologies that will make it possible to dispense with certain labor services will, in turn, create new occupational fields resulting from the progress they bring about. The ILO advocates “boosting skills development and vocational-technical learning as vital for embracing innovation and boosting productivity.”

In that order (oh irony!), artificial intelligence itself has been used by the planners of productive profiles to predict the destruction of payrolls to which it is heading: checkout operators and supermarket workers, manufacturing workers, truck drivers and delivery drivers, and above all: telemarketing operators and “lung-breathing” bank tellers. The Dominican airwaves transmit an immense number of advertising “spots” aimed at eliminating the need to visit bank offices in person (which is doomed to disappear) and that it is enough to press the keys from home or without getting out of the car. In countries such as Chile, former bank employees make up a larger population than those who still make a living in the financial sector.

The Santo Domingo Institute of Technology (INTEC) offered its own take on the dilemma at a recent Listín Diario breakfast: “We know that there is practically not a single profession that will not be impacted by technological changes and we know that what we are seeing from Artificial Intelligence is still only a glimmer.” Preparing for what’s to come, INTEC has a lot of research underway to devise solutions to the problems that will challenge the future.

The evil of many…
A recent study by the Inter-American Bank recalled that for 17 years, the Dominican economy grew but without significant contributions from increased productivity based on the training of labor resources. There was an enviable growth to which the excellence of the labor force only contributed 0.2%. There has been a lack of essential technological and professional improvement of human resources.

This is a shortage that is not exclusive to the country: “35% of the companies in the Latin American and Caribbean region do not have qualified labor for industrial processes, which adds to the deficit in investment in infrastructure as a challenge that the region must overcome to face the stealthy consequences of the war between Russia and Ukraine and the variations in the commercial flows of raw materials”. The World Bank announced this.

In the Dominican Republic, “jobs have recovered to pre-pandemic levels, but the change in international trade trends is forcing companies to locate closer to their trade destination.” The great North American market is just around the corner, unlike China, the great factory of the Americans. But taking more advantage of it is conditioned to adopting innovations, better production management, labor training, and modernization of machinery that has been left behind.