Extra jobs from IT just a 'myth'

May 5, 1995

A major conference next week on the social and economic implications of information and communications technologies will hear that there is little evidence of the rapid growth in electronic communications creating new jobs in the near future.

According to John Goddard, of the University of Newcastle upon Tyne, it is a "myth" that the convergence between telecommunications and computing, called telematics, is creating huge numbers of jobs.

Professor Goddard says that at the moment, job losses, caused by technologies like telematics, are exceeding their ability to generate jobs. He says that banks and insurance firms are among the sectors most dramatically affected by the rapid uptake of telematics. There have already been big shakeouts of these sectors with thousands of jobs being lost. Stiffer competition has contributed to this, but telematics has also played a significant part.

Professor Goddard says that the telephone bank First Direct has 1,000 full-time staff serving around 500,000 customers. But the traditional operation of Midland Bank, which owns First Direct, has 36,000 employees serving four million customers. "Certainly Midland offers more services, but direct banking facilities such as First Direct are beginning to broaden the range of offerings to match those on offer by the High Street banks." His case studies of the telematics in use show that in many cases job gains in one location are associated with far greater job losses in a number of other locations.

But Professor Goddard, dean of the faculty of law, environment and social sciences at Newcastle, will tell the conference, which marks ten years of the Economic and Social Research Council's programme on information and communication technologies, that telematics also has many advantages. Its potential to communicate information over space is having a beneficial impact on activities such as design, development and manufacturing and improving links between suppliers and manufacturers. Successful implementation can help firms compete more successfully.

Telematics has also played a key role in determining the nature of corporate and government reorganisation.

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