Dispatches from the NAPF conference in Edinburgh: Why the CEO of BlackRock is worried about emerging markets
You might expect the chairman and CEO of BlackRock, the world’s biggest asset manager and pioneer of exchange-traded funds, to embrace the very latest technology with open arms.
Instead, Fink is concerned that technology will stunt growth in developing economies.
Historically, new markets have taken off by offering cheaper labour than their developed counterparts. But machines are taking over from humans, threatening this vital area of growth in the emerging markets.
Technology is gutting jobs more rapidly in the developing world
“Technology is gutting jobs more rapidly in the developing world than it is in the developed world… that is going to have a profound effect on the future of the world,” Fink told the National Association of Pension Funds’ investment conference.
Fink cited the example of a construction company in India which has cut its employee head count from 10,000 to a mere 1,200 and seen productivity increase by 30% - all because of technology.
“You have that manufacturer in India, you have companies like Foxconn in China that are building factories that, they state, could displace the employment of 300 people because of robotics.”
I just don’t know if we have enough global GDP to create those jobs
Fink continued: “My biggest fear is technological changes in agriculture…. you don’t need humans now to harvest many fruits and vegetables.”
“My biggest worry about jobs and global risk is this technological boom that is transforming developing countries. They still have people who need some form of 21st century jobs. I just don’t know if we have enough global GDP to create those jobs, especially as we revolutionise agriculture at a very rapid pace,” concluded Fink.