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Artificial intelligence

Asia’s AI agenda: AI and human capital

While AI will be a major growth driver for Asia in the coming decade, it will affect one in every five jobs in Asia—eliminating one in eight, a new study finds.
May 10, 2019
Asia's AI agenda
Asia's AI agenda
Asia's AI agenda

Produced in association withADP (Founding sponsor), IMDA (Gold sponsor), Genesys, Splunk, Asia School of Business (Silver sponsors)

The impact of AI on work, jobs, and people is one of the most controversial aspects of today’s technological wave that will undoubtedly transform companies, industries, and societies in the years ahead. In this report, the third in our “Asia’s AI agenda” series, we explore the degree to which executives in Asia Pacific are expecting and preparing for the automation of job roles. We also look at how staff working in companies across the region are responding to the increasing need to work “shoulder to software.”

The report also explores a new data set provided by Faethm, a future-of-work cloud software company. It shows, by country and industry, the proportion of formal sector jobs that will become redundant through automation. It also shows the proportion that will be supported and augmented by AI, making those jobs more productive and highly skilled.

Here are the key findings of the report:

Asia's AI agenda: AI and human capital

  • AI will be a major growth driver for Asia in the coming decade. The company priorities for AI are to enhance customer satisfaction, speed up decision-making, and reduce inefficiencies. The loss of some roles to automation, and the restructuring of others to take advantage of technology-created capacity, are likely. Yet reducing headcount is not a top priority in and of itself. Just one-third of survey respondents listed the need to reduce labor costs as a top-three driver for AI.
  • The large majority of companies are expecting headcount to increase. Some 77 percent of survey respondents expect total headcount to increase over the next five years, including in functions where AI is already being deployed. One fifth of respondents overall indicated that they expect five-year increases of more than 15 percent. Very few (just 3 percent) are predicting any headcount contraction.
  • Yet AI will affect one in every five jobs in Asia—eliminating one in eight. Faethm data shows that across 11 Asian markets, 12 percent of current jobs are at high risk of being automated in the next five years. By analyzing ILO employment data with each job categorized in up to 218 specific job-related tasks, the data show that the effect of AI on job automation will be greater in Asia’s wealthier economies than in poorer ones (14 percent as opposed to 10 percent). However, many more jobs in those developed markets will actually benefit and be augmented by AI (11 percent of the total) than in less-developed markets (just 6 percent). The data were measured against country and industry forecasts for the adoption of 17 emerging technology categories.
  • AI will produce winners and losers. The introduction of AI in high-income countries will result in a high degree of job augmentation and added capacity, mostly in knowledge-intensive industries. In developing Asian countries, fewer jobs are augmented by technology, and little capacity is added. The degree to which jobs are enhanced is determined by the structure of each country’s economy, its technology-readiness in each category, and other economic and social drivers. Labor-constrained markets such as Singapore, Australia, and Japan will be among the fastest to seize the opportunities created by AI.
  • Talent and technology agendas must align to sustain long-term growth. Survey respondents believe that jobs are being enhanced by AI, and that employee satisfaction overall is increasing as a result. But is there a false sense of security? Corporate expectations for growth and the belief that AI will have a net positive effect on jobs may prevent the necessary preparations for disruption and reskilling from taking place. Across the region, governments are also unprepared for how fast technology will outpace human capabilities in some areas. Business leaders and policymakers must urgently align technology and talent agendas to build career pathways for those displaced, and to ensure that critical skills gaps do not open up and restrict growth in the long term.

The first part of this series, “The ecosystem,” explores Asian governments’ plans for leadership in AI. The second, “AI for business,” examines how businesses are creating strategies for deploying the technology.

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