The International Labor Organization has warned of the severe consequences presented by automation and disruptive technologies in the ASEAN bloc. Are the UN agency’s concerns founded? DW takes a closer look.
The UN’s International Labor Organization (ILO) published a report this week revealing the challenging impact of disruptive technologies and automation on jobs in member states of the Association of Southeast Asian Nations (ASEAN).
“While mass job displacement is not imminent, the technology to replace mainly lower-skilled jobs in ASEAN will increasingly be adopted as its cost declines and innovations become accessible to even small-sized enterprises,” ILO reported in a statement.
ILO “estimates that about 56 percent of all salaried employment in Cambodia, Indonesia, the Philippines, Thailand and Vietnam is at risk of displacement due to technology in the next couple of decades.”
The report, which surveyed more than 4,000 companies and 330 shareholders in the bloc, warned that, though “mass scale job displacement is not imminent,” the impact would be felt hardest on “labor-intensive sectors such as textiles, clothing and footwear” because of their generally low-skilled nature.
These sectors amount to more than 9 million jobs across the bloc, the majority held by young women.
The socioeconomic impact of technological disruption on these sectors poses a number of challenges that may alter other parts of ASEAN member states, including their social and political landscapes, although some will likely feel it more than others.
“Job losses at the low-skilled end of the labor market will in the first place have serious social repercussions,” Jürgen Rüland, professor of political science and project chair of Southeast Asian studies at Germany’s University of Freiburg, told DW. “Female workers in Cambodia’s textile and clothing industry, for instance, irrespective of very low wages, send back considerable remittances to the villages.”
“Job losses will thus further deepen the already rapidly increasing disparities between rural and urban areas and between the better- and the less-educated segments of the population,” Rüland said.
The ILO report recommends that member states promote resources to providing science, technology, engineering and mathematics (STEM) qualifications for young people, with priority for women.
Of the more than 2,700 students surveyed for the report, only 17 percent of females “indicated they were doing STEM courses.”
Labor shifts induced by automation and technological disruption will not solely exasperate economic disparities, but may pose threats to democratization efforts in the region.
“Politically, this may play into the hands of populist leaders, such as former Prime Minister Thaksin Shinawatra in Thailand or more recently President Rodrigo Duterte in the Philippines,” Rüland said. “Politically and socially divided countries might be more prone to political destabilization, with serious consequences for the region’s prospects to democratize.”
ILO’s report recommends that workforces in the ASEAN bloc be trained in skills that will allow them to adapt to diverse working environments and handle new technologies to work alongside digitalized machines.
Deborah France-Massin, director of ILO’s Bureau for Employers’ Activities, urged the bloc’s member states to reconsider their positions in the global marketplace and opt for developing these skills in the workforce.
“Countries that compete on low-wage labor need to reposition themselves,” France-Massin said. “Price advantage is no longer enough. Policymakers need to create a more conducive environment that leads to greater human capital investment, research and development, and high-value production.”
Professor Rüland pointed to “cooperation and institution-building” as a key feature in mitigating the potential impact of “technologically induced job losses.”
“The problem, however, is that ASEAN countries regard themselves more as economic competitors than as partners so that cooperation effects in the economic domain are limited,” Rüland said.
The impact of technological disruption on the workplace will not be confined to Southeast Asia.
Earlier this year, World Economic Forum Chairman Klaus Schwab said “current trends could lead to a net employment impact of more than 5.1 million jobs lost to disruptive labor market changes” between 2015 and 2020, with a total loss of 7.1 million jobs across the globe.
“Manufacturing and production roles are expected to see a further bottoming out but are also anticipated to have relatively good potential for upskilling, redeployment and productivity enhancement through technology, rather than pure substitution,” Schwab said.
But Tim Forsyth, professor of development at London School of Economics, questioned whether the effects would be as severe as the ILO suggests.
“Perhaps the longer-term transitions could, arguably, be indicated by experiences elsewhere,” Forsyth told DW. “For example, in Europe or North America in the 1960s, people worked in factories.”
“Now, fewer people work in factories, but many still work there, while service industries have grown and people discovered other ways to generate incomes,” Forsyth said.