16.10.2018

Managing the labour market in an integrated ASEAN in the digital era

Smart factories and AI-augmented services have potential to cause massive disruption in the labour-intensive manufacturing and services sectors of Association of Southeast Asian Nation countries.

Like the rest of the world, the 10 member States of the ASEAN Economic Community (AEC) are affected by the technological revolution that is commonly known as the Fourth Industrial Revolution, or Industry 4.0. At the heart of this revolution is the digitalization of almost everything. Digitalization is changing enterprises and altering the way we work and, inevitably, our way of life.

Digital platforms make it possible to organize economic activity in such a way that work that was traditionally done by full-time workers is shifted to individual freelancers and on-demand workers. This is leading to an economy that increasingly relies on short-term freelance relationships rather than on full-time employment.

Naturally, these changes are raising a whole new set of challenges to the governments all over ASEAN and the world. It intensifies the struggle to secure decent jobs and build a more inclusive, equitable and sustainable socioeconomic order.

The Fourth Industrial Revolution is likely to lead to greater inequality because further automation will lead to the displacement of more workers, especially those who are unskilled and semi-skilled.

ASEAN companies lag behind the adoption of technology, but, already, the inroads of digital platforms and artificial intelligence (AI) are being felt. Smart factories and AI-augmented services have the potential to cause massive disruption in ASEAN countries. Especially those dependent on labour-intensive manufacturing and services sectors, since the tasks in these sectors can be automated.

It is thus urgent for ASEAN to develop economic growth strategies that take into account the impact of technology on workplaces. But in doing so, we must not lose our development perspective – our vision of how workforce preparations and adjustments should be undertaken in an inclusive, equitable and sustainable manner.

Trade unions are not against economic globalization and technology modernization. However, we want both processes to be just, fair and equitable. We need greater policy coherence in human capital formation and economic and labour market governance, where the human and social dimension is fully enshrined. This is essential to minimize the negative impact of business and job destruction and maximize the positive effects of business and job creation.

“ASEAN needs to craft the economic, social and labour rules of engagement in the digital economy.”

Digitalization will continue to impact work, workers and organizations in many profound ways, and job displacements will be inevitable. In this connection, the governments in the various ASEAN countries and the AEC collectively must adopt a pre-emptive approach towards improving the long-term employability of workers and facilitating greater mobility of labour.

They must create the institutional framework and mechanisms to enable and encourage trade unions and employers to work in partnership to manage adjustments and to overcome the challenges confronting enterprises and their industry in the digital era. It should include adjustment measures that minimize job loss and facilitate the smooth transitioning of workers from the old to the new jobs.

We need more effective measures to manage the labour market, including a "flexicurity" strategy to balance the needs of enterprises for flexibility in an increasingly competitive economy and the workers' concern for the impact of flexibilization of employment on job security, social protection and sustainable income.

We commend ASEAN for their commitment to socializing the economic integration process to ensure economic growth that facilitates social progress in a people-first community.

We are encouraged by the innovative mechanisms being developed to engage civil societies, including trade unions, to ensure that policies and strategies are reflective of the challenges confronting all workers and the ASEAN community. However, there is still much to be done to deal with the challenges of the Fourth Industrial Revolution. ASEAN needs to develop more programmes to promote social inclusion. We need regional and global digital social compacts that support social integration, balanced development and sustainable growth for all. We also need ASEAN to craft the economic, social and labour rules of engagement in the digital economy.

“The quest for lifelong learning to help workers acquire knowledge and skills to cope with the new technology must be an integral part of the ASEAN strategic response to the Fourth Industrial Revolution challenges.”

The Fourth Industrial Revolution is a continuing one, and its effect on business and the labour market is also a never-ending proposition in the digitization era. Therefore, these dialogues between the social partners have become endless tasks but very necessary to negotiate for just and humane approaches to manage change in the digital economy.

The same is true for the ongoing effort to prepare the ASEAN workforce, given the changing and emerging realities in the economy and the labour market spurred by global competition, never-ending technological developments and the demographic structure in each ASEAN country. Thus, the quest for lifelong learning to help workers acquire knowledge and skills to cope with the new technology must be an integral part of the ASEAN strategic response to the Fourth Industrial Revolution challenges.

The tripartite partners must share responsibility and work in partnership to realize the collective vision of a people-centred ASEAN Economic Community.

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Christopher Ng is the UNI Apro Regional Secretary (chrisng(at)uni-apro.org.sg). The text is a modified version of the speech he delivered at the ninth ASEAN Regional Tripartite Social Dialogue Conference, organized by the ASEAN Employees Trade Union Council (ASETUC) with support by the Singapore-based FES Office for Regional Cooperation in Asia.

Friedrich-Ebert-Stiftung
Office for Regional Cooperation in Asia

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