Theories, conspiracy or rational, have often speculated about the impact of automation and AI on the job market.

Artificial Intelligence (AI) and automation are now commonplace terms that are part of parcel of our daily lives. Companies have taken advantage of technological innovation to drive change and improve profitability and the jobs of today vastly differ from the jobs of yesteryear.

Singapore might become a global AI hub

AI-based systems and in some cases, robots, have penetrated almost every sector of the economy and have grown to be part of the fabric of many industries. The question that is often asked, is if this is a good or bad thing for humanity in the long run. Indeed, AI and automation has the utmost potential of redefining workplace productivity, efficiency and precision; but is this entirely beneficial? Experts believe this rise of AI and automation will replace human workers and very few jobs will be safe in an increasingly artificially intelligent workplace.

How do we class AI?

According to the World Economic Forum (WEF), AI is expected to create nearly 58 million new jobs by the year 2022. However, with this job creation and the new new roles will be created, nearly 75 million jobs will be displaced due to AI and automation, leaving only the most skilled 58 million at work.

In fact, nearly 50 per cent of all companies are expecting their labour force to shrink by 2022 due to automation. However, the news isn’t all doom and gloom, almost 40% see new roles being created within their company to utilise the AI capabilities.

So is AI a friend or a foe? Companies want to implement AI into their business, but also acknowledge this will impact their workforce completely.

What does this mean for the region?

According to a recently published McKinsey report, it is estimated that currently demonstrated technologies have the potential to automate roughly half of the work activities performed in ASEAN’s four biggest economies:

  • Indonesia (52 percent of all activities)
  • Malaysia (51 percent),
  • The Philippines (48 percent)
  • Thailand (55 percent).

This represents more than $900 billion in wages.

However, if harnessed in the right ways, AI technologies have the potential to contribute to positive social outcomes in the region. Machine learning innovations can enhance credit models and financial inclusion, for example. This will have massive implications in this emerging region, where financial inclusion is crucial.

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AI solutions can enable new types of preventive and remote health care; they may also improve diagnoses and speed the development of new drugs. Adaptive learning algorithms could play a role in delivering individualised and virtual education. However, it must be noted that the infrastructure required to implement this solution is still lacking across most of the region.

For their part, most of the companies across Southeast Asia will need to make fundamental changes in management culture. This might include adopting a data-driven style of decision making, and striking innovative partnerships with specialist firms to incubate the scarce skill sets needed for AI efforts. This is similar to what Grab is aiming to role out with their recent AI announcement.

Although the market will drive the development and adoption of AI, the role of governments is critical to deliver benefits across the society. According to the report there are three main areas of focus:

  • Establishing a regional policy framework to support AI development and adoption
  • Developing AI talent and encouraging usage at the local level
  • Focusing public debate on ensuring that AI contributes to inclusive growth and positive social outcomes.

What’s next for our jobs?

There has been increasing evidence signifying the benefits of intelligent systems across the world, and now business leaders can take critical decision based on facts in the boardrooms. Companies employing AI systems are gaining competitive advantage by reducing operational costs and head counts but this also comes as a worry for those working in roles at risk of displacement.

How artificial intelligence is helping big and small business in Southeast Asia

With that being said, employees might have the option to be optimistic that this AI-driven shift in the workplace will create more jobs which are better rewarding and creative. As AI systems further develop, new skills and jobs will be required to set and implement systems, processes and policies. Increase in productivity due to automation means more revenue will generated, which provides opportunity for employees to earn more.

Though it seems inevitable that AI and automation will impact the job market, this does not mean that companies will replace workers with machines overnight just because it is technically feasible to do so. The pace and extent of automation will be determined by how companies view the business case, weighing considerations such as the cost of these technology systems, their ease of use, labour market dynamics, the value that could be created, the customer experience, their own capabilities, and regulatory and social acceptance.

The time to shape the future of work is now. Artificial intelligence and automation provides an opportunity to grow but people with the right skills will survive the future in the upcoming competitive era.

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