MANILA, PHILIPPINES (4 May 2018) — As Asia and the Pacific seeks inclusive and sustainable economic growth, countries are adapting to the possibility that new technologies in fields such as robotics and artificial intelligence may lead to challenges for some industries and groups of workers, according to participants at a high-level Asian Development Bank (ADB) seminar.
“Advances in new technologies will raise incomes and increase demand from Asia’s rising consumer class,” ADB President Mr. Takehiko Nakao said at the Governors’ Seminar during ADB’s 51st Annual Meeting in Manila, Philippines. “Countries that maintain flexible policies, support improvements to education, and put in place a stronger social safety net will be well positioned to take advantage of change that new technologies will bring to the region.”
The seminar “Technological Change, Globalization, and Jobs in Asia” had as panelists Philippines Finance Secretary Mr. Carlos G. Dominguez, Indonesia Finance Minister Ms. Sri Mulyani Indrawati, Japan Deputy Prime Minister Mr. Taro Aso, and Fiji Attorney-General and Minister for Economy, Public Enterprises, Civil Service, and Communications Mr. Aiyaz Sayed-Khaiyum. They shared experiences and issues from their countries’ perspectives.
According to the theme chapter of ADB’s Asian Development Outlook 2018, despite concerns that new technologies and automation could lead to widespread job losses, there are four reasons for optimism about developing Asia’s job prospects.
First, despite the growing use of industrial robots in the region, new technologies often automate some tasks of a job, not the whole job.
Second, automation takes place only where it is both technically and economically feasible, and it has so far been concentrated in the region’s capital-intensive manufacturing with relatively low employment levels.
Third, empirical evidence from developing Asia shows that jobs created by rising domestic demand more than compensate for job losses due to technological advances. This job creation will likely continue as a growing middle class consumes more and better goods and services.
Fourth, technological advances and rising incomes will lead to new occupations and industries, further offsetting labor displacement due to automation.
Nonetheless, new technologies will alter the composition of skills needed by the workforce, panelists said. They may lead to more frequent unemployment and lower wage growth for less skilled workers who engage in manual and routine tasks, widening income inequality.
Governments can respond by ensuring workers are protected from these negative effects. This will require policy actions on education and skills development, labor regulation, social protection, and income distribution. Also, government support for new technologies must benefit people and protect their rights and privacy, panelists agreed.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region. In 2017, ADB operations totaled $32.2 billion, including $11.9 billion in cofinancing.