Changes of Employees’ Skill Requirements Caused by Technological Progress

Technological advancements over recent decades have significantly transformed the business environment, driving digitalisation, robotisation, and the development of artificial intelligence. These changes have intensified competition and spurred the growth of global technology companies, while impacting traditional industries. This paper examines the evolving skill requirements of employees due to technological progress, particularly in the context of Industry 4.0 and 5.0. Industry 4.0 focuses on digital technologies, such as the Internet of Things, robotics, and cloud computing, to automate production processes. In contrast, Industry 5.0 emphasises the integration of human intelligence with advanced technologies to achieve personalised and sustainable solutions. The study categorises the impact of technological progress on work requirements into unskilled-biased, skill-biased, and talent-biased technical changes. Unskilled-biased changes increase productivity among low-skilled workers, while skill-biased changes enhance the demand for higher skills, especially in information and communication technologies. Talent-biased changes reflect the growing need for experts in robotics, AI, and data analysis. The chapter also highlights the shift towards valuing soft skills, such as critical thinking, creativity, and problem-solving, which are crucial in the modern industrial landscape. The findings emphasise the necessity for continuous learning and adaptation to keep up with technological advancements. Additionally, the chapter underscores the importance of aligning training and development programmes with future workforce needs to ensure employees are well-equipped to thrive in digital and automated environments. These insights are vital for policymakers and educators to foster a workforce that can effectively navigate the challenges and opportunities presented by Industry 4.0 and 5.0.