Future of Work: Skills and Automation

This assignment focuses on the future of work in Australia, exploring the impact of automation and globalization on the job market. Students are required to discuss how automation may lead to unemployment, provide examples of industries affected by globalization, and suggest policy solutions to address these challenges. The assignment utilizes a report from the Foundation for Young Australians as a source.

Macro1 (ECON1010), Sem. 2 2017 Question Set
MACRO1 (ECON1010) Assignment 1
(Chapter 28, 26&27 Principles of Economics or Chapters 9,7 & 8 Principles of Macroeconomics )
Submit online at the ‘Assessment Task’ in Blackboard
Due: 11:59PM on 10 September (Sunday)
Tutorial Time and Day:
____________________________________________________________________________________
___________
Student Name:
____________________________________________________________________________________
____________________
Student ID:
____________________________________________________________________________________
_________________________
This assignment covers the following topics:
 Unemployment (Chapter 28 or Chapter 9)
 Productivity and Growth (Chapter 26 or Chapter 7)
 Saving, Investment and Financial System (Chapter 27 or Chapter 8)
READ THE FOLLOWING FIRST (Very Important)
1. This assignment contributes to 20% of the overall marks for the course.
2. Only a single submission permitted (hence, please ensure to attach the file version of the
assignment)
3. Use and Submit this template only for your submission (i.e., write down your answers in
the space provided in each question and submit) – any other form of the file is NOT accepted
(Failing to do so will automatically mean zero mark for this task).
4. If you do not have a word processor installed in your home computer, follow this link and
in “APPS” you can use a Microsoft word processor;
http://www1.rmit.edu.au/students/mydesktop
5. The recommended browsers when uploading the file are Chrome, Firefox or Explorer (some
have suggested that Safari might not work well).
6. The font size has to be at least 12.
7. Explain your answers, but be succinct.
8. Label each axis and explain the diagram that you use carefully (if any).
9. Show all of your working in order to get partial credits.
10. After the due date any late submission will be marked as ‘late’. A penalty of 10% of the allocated
marks (i.e., 2 marks) per day will apply for late submissions.
11. A failure of your home computer (or any kind of the IT problem) cannot be a reason for
the late submission (all requests for an extension of this nature will be rejected
immediately).
12. Make sure you have included your student ID and name in the front page of the assignment
13. Working with other fellow students is strongly encouraged. However, you cannot just copy your
friend’s answers. If we find out this, you will be harshly punished for the academic plagiarism.
See ‘students responsibilities’ at RMIT’s policy on this:
14. http://www1.rmit.edu.au/browse;ID=sg4yfqzod48g1
Page 1 of 6

Macro1 (ECON1010), Sem. 2 2017 Question Set
Short Answer Questions:
1. Consider a closed economy in which GDP equals $20 billion, consumption equals $13 billion,
government purchases equal $3 billon and tax revenue equals $1 billion. Use this information to
answer the following questions: (3 marks)
a. What is private savings equal to in this economy? (0.5 mark)
Public Savings = T – G
$1billion - $3billion
= - $2 Billion
b. What is public savings equal to in this economy? (0.5 mark)
Private savings = Y - T – C
$20 Billion - $13 Billion - $3 Billion
= $4 Billion
c. How would the level of public savings impact the supply of loanable funds? (0.5 mark)
Private savings is the source of loanable funds. Therefore high level of private spending leads to
increased supply of loanable funds
d. What is national saving equal to in this economy? (0.5 mark)
S = Y - C – G
$20 Billion - $13 Billion - $3 Billion
= $4 Billion
e. What are net exports equal to in this economy? (0.5 mark)
There are no net exports since it is a closed economy. That is the GDP is as a result of internal
economic activity only
Page 2 of 6

Macro1 (ECON1010), Sem. 2 2017 Question Set
f. What is investment equal to in this economy? (0.5 mark)
Investment is equal to the National Savings
= $4 billion
2. Explain how labour productivity is determined. In your answer address why human capital is
considered to be so vital to lifting labour productivity levels. To illustrate your understanding
provide an example. Your answer should be between ½ page and a full page. (4 marks)
Labour productivity is given by the number of output per period (GDP) divided by the number of workers.
Human capital is vital in lifting labor productivity levels since it is a component of the equation that
determines labor productivity. It is through the human capital that performance and targets are able to be
achieved. For example when one person is able to produce 1000 units per hour while another is able to
produce 2000 units per hour. The individual who produces 200 units per hour is more productive compared
to that one who produces 1000 units per hour. In this case it is more economical for the firm to select the one
that does 2000 units per hour in order to maximize on the labour productivity.
Page 3 of 6

Macro1 (ECON1010), Sem. 2 2017 Question Set
3. Watch the Gapminder video ‘200 Years that Changed the World’ available from
http://www.gapminder.org/videos/200-years-that-changed-the-world/ and answer the following
questions:
a. When Hans Rosling talks about China ‘catching up’ with the United States, explain in more detail
what he means by this? Your answer should be around ¼ of a page. (1.5 marks)
Hans Rosling argues that China is catching up with the United States in terms of its economic position.
China is engaging in more trade and technology application in production. In this way, the country is
able to increase its level of output and overall GDP. It is therefore able to reach the GDP level of the
United States and therefore catch up with it. This has been promoted by good education present in china
that has increased their competitive nature.
b. How can free trade help middle income countries or emerging economies ‘catch up’ with the high
income or developed economies? Your answer should be ½ a page and include a relevant example.
(2 marks)
Free trade helps middle income countries be able to improve their balance of trade. They are able
therefore to engage more and participate in competitive advantage trade deals that improve their level of
output and consequently GDP. Free trade essentially means that the countries are able to import and
export goods with the absence of tariff barriers and the non-tariff barriers to trade. It therefore enables
countries to obtain lowered prices and achieve benefits from the economies of scale. Using competitive
advantage countries are able to produce products for which they are best suited at lower costs than their
counterparts. This therefore increases their output and GDP, also the countries are able to achieve lower
prices for products. Increase in trade creation results as consumption moves from high cost producers to
low cost producers.
c. On the y-axis of the visualisation Hans Rosling presents in the Gapminder video, income per person
is shown. What is an alternative label or term that we have used in the course that means the same as
income per person? (0.5 mark)
Income Per Capita
d. The income per person referred to in part c. above is ‘inflation adjusted’. Why is it necessary to
adjust this for inflation? Your answer a should be no longer that ¼ of a page (1 mark)
Page 4 of 6

Macro1 (ECON1010), Sem. 2 2017 Question Set
It is necessary to adjust for inflation in order to reveal the real effect of the GDP per capita in that
particular year for comparison purposes. The Real GDP is the GDP without the effect of price
changes especially since the price changes may have been caused by different factors within that
economy and may therefore fail to become a proper measure for comparison over time as well with
other countries.
4. Read the recent report released by the Foundation for Young Australians The New Work Order:
Ensuring young Australians have skills and experience for the jobs of the future, not the past.
Available online: file://ntapprdfs01n02.rmit.internal/eh2/E10092/https://.fya.org.au-wp-content-
uploads-2015-08-fya-future-of-work-report-final-lr.pdf or via
https://www.fya.org.au/our-research/#report-downloads )
Having read the Report answer the following questions:
a. The report identifies one the forces shaping the future as automation. Discuss how automation may
impact unemployment in years to come. In your discussion be sure to identify the type(s) of
unemployment it may lead to and comment on what policy makers can do to address this. Your
answer should be around ½ a page. (3 marks)
Automation may reduce the number of people who will be required at certain job posts. It
may therefore lead to technological unemployment where there are people willing to work but there
are less opportunities for them to work. The entry level jobs for people are fast disappearing. There is
need for digital literacy for individuals in the work force. Policy makers may therefore assist
individuals to become prepared in this digital era. This can be done through the change of the
curriculum in order to accommodate digital literacy. There is also need to ensure that the work force
is able to accommodate a wide range of skilled individuals.
b. Globalisation is a dominant economic force that creates new opportunities but also presents some
challenges. Provide an example from Australia of an industry or sector of the economy that has
suffered job losses as a result of globalisation. In your answer explain why globalisation can create
unemployment in some industries or sectors of a national economy. Your answer should be around
½ a page. (3 marks)
Globalization has impacted the clothing industry in that it is able to let the production be done
in another country while they are marketed elsewhere. Job losses occur when individuals from other
countries are able to do jobs that are present n Australia. More specifically, this impacts clerical jobs,
software and programming, including legal, IT, design, and architecture and business services. There
is need for policy makers to design ways in which their work force can be positively impacted by the
wave of globalization.
Page 5 of 6

Macro1 (ECON1010), Sem. 2 2017 Question Set
c. Comment on something you have found interesting from reading the Report (that differs from your
answers in parts a and b). Your answer should be in one long or two shorter paragraphs. (2 marks)
It is interesting to note that there is an opportunity for individuals to prepare themselves for
automation and technology unemployment by trying to learn skills that may be applicable in that
particular job market.
Page 6 of 6