New laws on free public Internet access (Republic Act [RA] 10929) and free-education tuition (RA 10931) have been getting ample exposure, as the current administration seeks to advance its agenda for inclusive development. While these are notable steps toward efforts to boost prospects for economic growth through enhancing productivity and strengthening competitiveness, there are more significant technological shifts already reshaping our lives at breathtaking speed.
In 2016 World Economic Forum (WEF) founder Professor Klaus Schwab has written the book entitled The Fourth Industrial Revolution about the fusion of new technologies in mainstream discussion. He asserts that “there has never been a time of greater promise or potential peril”, as changes arising from this revolution would be irresistible. What Schwab is declaring seems extraordinary and detached from individuals’ everyday reality.
People have lately been living in a world where artificial intelligence, computerized algorithms, medical technologies, robots, 3-D printing, and unmanned vehicles, among others, have become plausible. The ability of these innovations to
“disrupt” current personal and business relationships has been extensive in significance and scope. Indeed, technology’s complexity level is becoming ever tangible that it is considerably impacting labor markets.
Technology is boosting productivity and improving efficiency, but doing so means slashing necessary work-force numbers to yield similar or even greater results. For instance, Amazon, the online retail giant, is tinkering with possibly having robots “autonomously remove items from shelves and place them in containers”. While it has employed tens of thousands people, Amazon wants to make its operations even more streamlined by adding more units to their 15,000 robots already performing the routine tasks.
Economists are observing the trend that machines would soon replace people for most of current economy jobs. In 2013 Carl Frey and Michael Osborne of Oxford University have studied 702 occupational categories in the US and found that 47 percent of workers, engaged in less-skilled activities, are most probably looking to lose their jobs to automation in the next couple of decades.
In 2016 the International Labor Organization (ILO) has released a report on the “Future of Jobs at Risk of Automation”, covering five Southeast Asian countries in which 3-in-5 jobs have a high risk of automation over the same period. The same ILO report indicates that nearly half of employment in the Philippines has a high likelihood of automation. Salaried Filipinos working in retail trade, banking, hotel and business-process outsourcing (BPO) industries fall into the high-risk grouping of automation. Eighty nine percent of BPO/call-center workers’ jobs are threatened to give way to technology substitution.
Particular individuals face more risks than others from new technologies and their consequences for the labor force. Differences based on age, ethnicity, gender, income and race result in varying consequences across demographic groups, but it is apparent that those without high-skill training would be less equipped to adjust to the emerging economy.
If automation is going to take over workplace processes, and health care, social security and other benefits are obtained through employment, how are displaced workers or those existing outside the labor force able to secure these “safety nets”? Serious questions for policymaking based on the surge of up-and-coming technologies, the shifting landscape of employment, and the variable effect on diverse groups in society need to be addressed.
Society ought to navigate its way into this newly emerging economy by discerning how to maintain provision of social benefits to everyone. First, social policy may need to be strengthened in terms of universally providing benefits to individuals, including education, health care, housing assistance, insurance and pension, while jobs are growing to be less stable, less repetitive, and largely less rewarding. Second, the establishment of a “universal basic income” may be explored, in that each citizen would certainly have access to basic subsistence goods and not be afraid of abject poverty. Third, education may be reexamined as ongoing pursuits for lifetime learning and job retraining through institution of financially funded “activity accounts”.
Society must figure out how to support people to live satisfying lives amidst this technological revolution. First, volunteerism among citizens may be promoted by providing benefit credits (i.e., income add-ons, social benefit eligibility) for increased community involvement and participation in non-profit or charitable work. Second, school curricular reforms may be considered, as new economy jobs entail people to develop skills in complex problem solving, critical thinking, creativity, people management, emotional intelligence, decision-making, service orientation, negotiation and so on. Third, expansion of arts and culture for leisure time may be envisioned, as automation of traditional jobs could open the possibility of a new “creative economy” wherein people’s aspirations for self-expression and self-enrichment are nourished.
Ultimately, we need to ask ourselves: “How do we move forward in the ‘new economy’?”
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Abigail P. Dumalus is a former faculty member of the Economics Department of Ateneo de Manila University. Dumalus is studying at the University of Aberdeen in Scotland.