Economics Paper on Impacts of New Types of Information Technology

Recent years have been characterized by significant advances in computing and communication technologies, with profound impacts on society. Technology is transforming the way employees interact and work with others within various organizational settings. The integration of information technology in an organization can create enormous benefits, and result to various challenges. Technological advances can make job listing and job searches easy, and it can act as a compliment to workers in specific tasks. However, information technology may act as substitute to workers in specific tasks hence it may cause a shift in the demand for labor, and eliminate some jobs. The technological advances in various aspects of employment relationships have various implications, and unions should embrace the use of new types of information technology.

New information technology has made it easier and cheaper to post and apply for job listings and screen jobs and applicants. To the traditional job search avenues that include hiring halls and employment agencies, new types of information technology have added online job applications and searchable databases of job listings. The online job posting, listing, and searching have increasingly grown over the last thirty years; hence, it has played an important role in matching employers and employees in the labor market. Moreover, new information technology is used to screen jobs and job applicants. It improves the ability of employers to screen various job applications (Arvanitis 997). An excess number of job applications has been the norm for online job listing, and employers claim that they receive applications from both over and under-qualified individuals. Thus, information technology is used to screen information easily and is objectively verifiable.

New types of information technology allow much greater disaggregation of the work process in space and time. Unlike the old vertically-integrated production, new information technology allows workers to undertake production from different geographically disparate workplaces or homes, at different times. As such, information technology allows for both outsourcing and telecommuting jobs to sub-contracted workers based in the United States or around the world. Technological advances have brought a revolution to domestic and international outsourcing, especially in the manufacturing and transportation sectors. Domestic outsourcing occurs when a company contracts an independent firm to perform a task that was previously being done by the organization’s employees or contract a different and independent firm to employ people to perform a given task for the company. Information technology also entails international outsourcing as it helps U.S companies to employ foreign workers to perform certain duties from different geographical locations across the world. Moreover, information technology allows for telecommuting. Telecommuting helps to connect a company’s workforce irrespective of their physical locations (Arvanitis 1002). Telecommuting holds the promise of efficiency gains for both the employer and employees as it cuts the cost and time for commuting and allows flexibility for family responsibilities at homes.

Information technology can serve as a substitute or complement to human labor. Information technology has not been adapted to all forms of labor across the U.S. economy. Robots or computers are designed to excel at tasks such as manipulating information and organizing. These tasks are mostly found in middle-skilled jobs such as repetitive production jobs and clerical work. New information technology often replaces or substitutes humans from such jobs. However, tasks that involve the exercise of some discretion, such as cleaning work and food preparation, or jobs that require adaptation of physical situations pose a threat to new information technology. Although information technology is making its way into all these areas, it seems it is substituting humans from middle paying skilled jobs in greater numbers than it is displacing high and low paying skilled jobs. Information technology can be used as a compliment. It is more likely to act as a complement to the high-skill professionals and creative workers, as it often acts as an opportunity of raising high wages for such workers. Information technology has also led to automation and the loss of many jobs within various organizations. As the pace of innovation in information technology quickens, greater implications are yet to come (Arvanitis 1009). Components of information technology, including software and hardware, have been improving exponentially. For instance, new self-driving cars have been poised to displace hundreds of truck and taxi drivers in the next one or two decades across the world. Information technology has shifted in favor of profits and against labor. This implies that the production relationship relies more on capital rather than labor. Soon, labor will not be needed to make profits in the U.S. markets, as computers are continuing to become smarter than humans day-by-day.

Since the 18th century, the U.S labor unions have consistently been protecting, and fighting for the rights and freedoms of the country’s workers. The protection is because of collective bargaining protests that these unions have been able to survive within the U.S economy. Today, U.S workers can easily address various challenges that they encounter at their workplaces such working under harsh conditions. However, the main question is whether these unions can survive in the digital era where information technology is part of the younger generations (Holley, Jennings, and Wolters 180). Unions are facing aging membership and are struggling to recruit young people. Most union members see technology as a barrier for recruiting a young generation of activists into these unions as these aging members do not have any knowledge about the new types of information technology. Information technology should be integrated into U.S. unions’ operations to allow the unions to expose employers who mistreat their workers, including subjecting them to low wage pays and harsh working conditions (Dau-Schmidt 1583). This initiative would ensure that violation of labor laws is regarded as a national disgrace; hence, American employers would be forced to establish an effective code of conduct. Information technology would also offer educational and training opportunities to union members to enable them to develop their careers and skills into more marketable ones. Moreover, the new types of technology would create partnerships that nurture union members’ engagement.

Information technology has significantly transformed every aspect of the employment relationship. It has changed the way employees look for jobs, and the way employers look for well-educated and experienced workers. It is now possible for people to apply and get recruited online and perform their work or tasks from different parts of the world. To some extent, not all jobs have been affected, especially the high and low-skilled jobs, since information technology makes it easier for humans to perform tasks at home while caring for their families. However, it has posed a threat to middle-skilled jobs resulting in loss of jobs. Moreover, for U.S. unions to survive, they need to integrate information technology into their operations as it creates union members’ partnerships and can be used to expose employers who violate employees’ labor rights.



Works Cited

Arvanitis, Spyros. “Modes of labor flexibility at the firm level: Are there any implications for performance and innovation? Evidence for the Swiss economy.” Industrial and Corporate Change 14.6 (2005): 993-1016,

Dau-Schmidt, Kenneth G. “Labor Law 2.0: The impact of new information technology on the employment relationship and the relevance of the NLRA.” Emory LJ 64 (2014): 1583,

Holley, William H., Kenneth M. Jennings, and Roger S. Wolters. The labor relations process. Cengage Learning, 2011.