The Fourth Industrial revolution entails shifting to more interconnected, efficient and flexible business models. In order to take advantage of increasing interconnectivity around the world, businesses will need to invest not only in new age machinery, but also in the high-skilled labour force, thus increasing spending on education. Industrial analysis of the most capital intensive industries of the top nine economies reveals that utilities and transportation were the ones to ramp up their investments in education the most.
In recent years, the Utilities sector has moved rapidly towards automation, however, faced budget constraints and a shortage of a competent workforce. For example, according to a 2016 study by Black & Veatch Corp, which provides consulting services in the fields of energy, water, and information, more than 70% of utilities players in the US adopted Advanced Metering Infrastructure (AMI), while more than half of the adopters made financial commitments to manage and extract value from the data collected through data utility service networks. Improving operational efficiency and effective capital assets management are expected to drive utility companies to employ big data analytics even more, which, in turn, is expected to result in higher spending on educating workforces.
Transportation companies have also been increasing productivity through automation and elimination of human interaction in recent years. Instead of frontline customer service, self-service models and real time operations enabled by data analytics are employed, all requiring high input from a high-skilled labour force. For example, tech-driven logistics network Cainiao already provides a data platform which enables faster and more effective package transportation through bundling deliveries in the same area. Every 10 packages delivered daily in China are processed through Cainiao.
Watches and clocks industry is another example of growing emphasis on employee training combined with high share of revenues dedicated to capital expenditure. Although major watchmakers take pride in hand making their articles, automation and mass-customisation are driving the change and saving some money too. 3D printing has been already used in manufacturing prototype parts for Swatch Group, TAG Heuer and Romain Jerome.
Note: Bubble size – share of revenues committed to capital expenditure