Embracing innovation and change to thrive

By Fernando Pavón


How can innovation be embedded to enhance resilience in the Caribbean?

The Caribbean, a region known for weathering hurricanes, faces challenges beyond natural disasters. With an economic growth that is weak and dependent on only a few sectors— tourism or commodity exports —emphasis needs to be placed on economic and technological changes and how these impact Caribbean nations.What has history taught us?

Looking at the timeline of the industrial revolutions, what stands out first is the time lapse between each occurrence. It took almost a century for each of the three industrial revolutions to take place.The first Industrial Revolution in 1784 brought mechanical production, railroads and steam power. The second Industrial Revolution in 1874 introduced the first assembly line. The third industrial revolution in 1969 rolled out automated production, electronics and computers. As the fourth Industrial Revolution unfolds, one of its greatest challenges is the pace at which these changes are taking place.

These technological changes are re-shaping our economies, the way we do our jobs and even the way we interact with each other. This generation lives in a technology- driven world that demands more resilient industries and a more resilient workforce capable of constantly adjusting to changes.Focusing on economic cycles, in terms of country-level economic growth, the 2007–2009 period was particularly problematic because of the global financial crisis. During this period tourism-dependent Caribbean countries suffered a significant hit, growing at only 0.36 percent and experiencing a negative growth of 0.07 percent during 2010–2013. The impact is reflected on youth unemployment rates. The Bahamas and Barbados for example, demonstrated a significant increase in youth unemployment since 2007.

How can Caribbean countries become more resilient to face economic shocks?

We can look at countries with a long tradition of advanced apprenticeship models, such as Germany, Austria, and Switzerland, that have managed to maintain lower unemployment levels for youth (Lerman, 2015) despite the economic crisis.

So how can the region embrace change at a much faster pace?

With technology forcing high speed changes in the world of business, the region has the opportunity to capitalize on the new technology- based jobs and embrace innovation as they invest in skills development systems that are synchronized with businesses. McKinsey Global Institute’s latest report, Jobs lost, jobs gained: Workforce transitions in a time of automation shed some interesting findings on what lies ahead of us. Among the most interesting is that “even with automation, the demand for work and workers could increase as economies grow, partly fueled by productivity growth enabled by technological progress.” Several see this technological progress as a “threat” to our jobs, others view these technological advances as a way to improve our lives.

History taught us that adapting to changes is what makes our society strive. Trying to understand how earlier industrial revolutions impacted the workforce will help shed some light on how society changes with the introduction of new technologies. “Before the advent of the Industrial Revolution, most people resided in small, rural communities where their daily existences revolved around farming. Life for the average person was difficult, as incomes were meager, and malnourishment and disease were common. People produced the bulk of their own food, clothing, furniture and tools. Most manufacturing was done in homes or small, rural shops, using hand tools or simple machines.” The technological advancements at the time provided a better quality of life, but it also threatened to displace workers. The workforce survived because people were adaptable to change. To smooth the looming workforce transitions with the adoption of technology/automation in the next couple of decades, McKinsey’s report recommends scaling and reimagining job retraining and workforce skills development.


Innovation: Embrace it or brace yourself.
Focusing on technological advancements, in terms of the pace of innovation and how it affects the region, the region should strive to have a pipeline of talent (workforce) that allows for industries to not only adapt, but to innovate. We are currently seeing an increase in innovations and a substantially faster pace of technology adoption. If we learn from history, it is important to enable our workforce to adapt to changes as industries evolve. We can embrace innovation through skills development by encouraging industries and employers to lead the charge. As firms adopt new technologies to remain competitive in their industries, they must also acquire a “need” to innovate. Beyond giving workers access to a stable career ladder, apprenticeships can represent a tool for countries to “instill skills needed for innovation to take place, for workers to be able to adapt and develop new technologies, and for human capital to be brought closer to firms’ operational needs for increasing productivity and competitiveness”.

In some countries, the adoption of innovation has been completely led by the private sector. In the United Kingdom for example, some employer-led bodies (Sector Skills Councils) have now been complemented by trailblazer groups of 10 employers in charge of developing standards for specific occupations in an industry – to directly shape the skills requirement per industry needs as it evolves. Employers are now at the forefront of the development of apprenticeships and learning, developing people with workplace skills that are relevant to business and industry. In this process, industry innovative practices, new technologies or evolving industry trends (at the global stage) can and should be incorporated to re-shape the skills for these firms to adopt such innovation.

Caribbean nations such as The Bahamas and Jamaica have taken steps to become more resilient. These nations that are aiming at diversifying the economy and boosting private sector development are focusing on skill development to prepare its workforce for a rapidly changing knowledge economy. The Bahamas is investing in a national apprenticeships program and is championing the establishment of sector skills councils in key strategic sectors. Jamaica is investing in its talent pool to better serve higher value-added options in the global services sector. Such initiatives are important public-private partnerships to develop a pipeline of talent that allows industries to constantly re-invent themselves and expand investments, creating more and better jobs.


About the author:

Fernando Pavón is a specialist in the Labor Markets and Social Security Division of the Inter-American Development Bank, IDB, based in Jamaica. Since his beginnings in the Bank in 2004, Fernando has worked in offices in Honduras in supervision / project implementation collaborating with the World Bank as a Junior Professional Associate in the preparation of the country strategy. He also coordinated activities of educational technologies in the Education Division of the IDB in Washington from 2010 to 2012. During 2013-2015, Fernando was in charge of the preparation and supervision of Labor Markets programs in El Salvador. Fernando has a Master in Public Policy from the Maxwell School of Citizenship & Public Affairs at Syracuse University.


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