The Impact of Technology on Wages in Non-Standard Employment

Introduction

The rise in income disparity has led to an increase in research on this topic, particularly since the second half of the 20th century. Including changes in other institutional and social variables complicates the investigation of the relationship between technology and this growth. The literature demonstrates that technological advancement has a variety of effects on unemployment. For instance, technical advancements may cause unemployment by reducing wages (Stiglitz, 2014; Stiglitz & Korinek, 2017). Low-skill job unemployment may rise as technology develops (Grigoli et. al., 2020). On the other side, it has also been discovered that new production technologies using modern technology lead to new job prospects (Hirvonen et. al, 2022).

It is recognized that technological progress increases production efficiency and total output, but there is no consensus on the degree of impact on processes. In addition, as technology advances, it is anticipated that both the quantity and composition of employment would alter over time. Changes in the supply and demand for employment are expected to change the wage distribution and its share in total income.

Compared to other forms of employment, non-standard employment has a different degree of inequality. It is crucial to comprehend how non-standard work interacts with advancements in technology and income disparity in order to comprehend these relationships. It is generally acknowledged that technological advancement raises productivity and overall output, even though there is disagreement over the extent to which these changes in production processes are brought about. Over time, this process might also result in modifications to the nature and organization of the activity. Depending on the direction and degree of changes in the supply and demand for labor, it is expected that the distribution of salaries and their proportion of total income will fluctuate. Every technical advancement results in a fundamental shift in the labor, products, and production process. Technological developments in the labor sector create new jobs. It also results in some employment leaving the labor market, though. Technology is complex and nuanced because of this. It is difficult to analyze statistically and consider it as a stand-alone variable. In particular, modern technological advances are changing the view of the human factor in production. Uncertainty about employment is increased by robots and artificial intelligence technologies, which are characterized as increasingly sophisticated forms of automation (Schmidpeter et al., 2021). Therefore, it is insufficient to analyze the relationship between technology and employment only in terms of the unemployment rate. In particular, the rise in skill-based technology has led to “job polarization,” or an increase in the percentage of high- and low-skilled positions in the workforce (Stadler & Wapler, 2004).

Especially in the 1970s, skill-oriented types of work, such as desk work or cleaning services, became widespread. This type of employment drew attention to the fact that non-standard jobs were envisaged as part-time jobs (Gleason, 2006). There is a continuous increase in non-standard jobs due to changing needs. Increasing automation, digital platforms and innovation in production technologies can lead to changes in employee benefits. The Covid-19 epidemic, globalization, and the robotics industry have all changed the nature of non-standard employment and its duration. This change has raised concerns that the workforce will not have equal rights with standard types of work. The need for skilled labor is rising due to skill-biased technological advancements, which also indicate the growing prevalence of gig economies made possible by technologies like artificial intelligence (AI) and computerized communication techniques (ICT). New working models (non-standard) are influencing the proliferation of types of employment that are temporary and do not guarantee a certain income. Non-standard employment usually consists of temporary work, part-time work, work under multilateral agreements and self-employment. These jobs are characterized by ambiguities in both the legislation and the sector. Salary is among the first issues that spring to mind.