29 Recent work indicates that trade unions in the US played an important role in supporting the wages of lower-skilled workers during the years of the 3rd Industrial Revolution, thereby helping to limit increases in inequality over this period. See Farber, H S , Herbst, D, Kuziemko, I and Naidu, S (2018), ‘Unions and Inequality over the Twentieth Century: New Evidence from Survey Data’, NBER Working Paper No. 24587. 8  All speeches are available online at www.bankofengland.co.uk/speeches  8  So building on the past, what could be done this time? First, everyone can contribute to a better understanding of the new skills that will be required. That includes granular reviews by firms of the mismatches between their current talent pool and future needs; estimates by the creators of general purpose technologies of the breadth of their potential applications; and reporting by public institutions on the aggregate pace of automation and trends in the labour market. The rate-limiting factor of technology adoption is often the skill-set of existing employees. For that reason alone, business has an enormous interest in effective workforce training. And the providers of generalpurpose technologies have a responsibility to explore how they can develop their products in ways that maximise job-creation or broader social benefits. For example, DeepMind established an Ethics and Society Research Unit to help technologists put ethics into practice, and to help society anticipate and direct the impact of AI so that it works for the many.
But this equilibrium could be unstable in a different inflation environment. Indeed, markets seem to be aware of some inflation “tail risks” and are hedging against these risks through gold and the CHF, whose prices have reached historical highs. In the Euro Area, we consider that any lasting backstop has to come from governments. This is why we have been asking for a speedy implementation and greater flexibility in the EFSF and very much welcome decisions taken in this regard in July and in October. At this stage, therefore, the euro area is paying a double price. One for its mistakes and one for its virtues. The mistakes, for governments, was to allow the piling up of debt through unsustainable fiscal policies over a decade, and then to create ex nihilo a doubt as to their willingness to pay those debts. And we are also paying the price for our virtue and our refusal to liquefy public debt through massive monetization of our fiscal deficits. I believe that virtue will eventually be rewarded. In the next decade, markets and lenders will trust those currencies that, whatever the circumstances, are managed with one overriding priority: preserving price stability and the intrinsic value of the currency unit. On this fundamental basis, we can look at the future of the euro with strong and realistic optimism. I see the recent decision by the Swiss central bank to peg the CHF to the euro as a confirmation of this statement.