Industry 4.0 may worsen the existing inequalities in the Philippines, according to the latest report released by the Asian Development Bank (ADB).
In the report, titled Technical and Vocational Education and Training in the Philippines in the Age of Industry 4.0, ADB said Industry 4.0 is expected to cause “massive job displacement and job gains and transform work tasks and occupations.”
ADB said in this regard, the technical and vocational education and training (TVET) from the Technical Education and Skills Development Authority (Tesda) would have a major role to play.
“Due to Industry 4.0’s potential to exacerbate existing inequalities, TVET has a major role to play, particularly through the delivery of high-quality programs in line with the demands and requirements of growth sectors, and the targeting of disadvantaged groups, particularly youth, women, and the poor population residing in largely agricultural regions,” the report stated.
The study stated that the country’s economic growth in the past 10 years made it one of the fastest-growing economies in the world. This also improved the quality of employment in the Philippines.
The report noted that the country’s GDP growth was at 4.8 percent annually between 2000-2010 and 6.3 percent between 2010 and 2019. This growth, however, failed to lead to massive job creation and improve the state of informality, underemployment, and vulnerable and precarious employment in the country.
ADB said despite the rapid growth, some 2.3 million of the Filipino labor force were unemployed and an additional 5.9 million were underemployed in 2019.
“In the coming years, to meet its more-inclusive development objectives, the Philippines will need to expand the scale of decent work creation, and engage more of its population in the labor force, with a particular focus on women, youth, vulnerable groups, and poorer regions. In that regard, skills and education have a major role to play,” the report stated.
ADB said the review was timely given that Covid-19 continue to take a heavy toll on the Philippine labor market. The National Economic and Development Authority (Neda) said that as of January 2021, around 4 million Filipinos remain unemployed.
ADB Human and Social Development Director for Southeast Asia Ayako Inagaki said in a statement that now more than ever, the importance of adequate and timely investment in skills—including reskilling, upskilling, and the development of strong technical and soft skills—is needed to help displaced workers’ transition into new jobs.
“The Covid-19 pandemic has deeply affected segments of the population that are most in need of upgrading their skills to adapt to the changing needs of the labor market,” Inagaki said.
“Through much-needed investments and capacity building, the government’s technical and vocational education and training system can help shape labor market outcomes and adjust to anticipated changes to achieve its dual objective of creating a competitive work force and helping marginalized workers,” she added.
ADB said school disruptions and closures due to the pandemic have opened the doors for Tesda to adopt nontraditional, innovative, and flexible solutions, such as online learning and digital tools. These have played a critical role in retooling and upgrading the skills of displaced workers.
Tesda, ADB said, responded swiftly to emerging labor market needs. It expanded access to its online programs through a partnership with the private sector and launched a plan to develop policies and programs that will help the country respond to the ongoing crisis and adjust to the changes.
“There are important challenges to tackle with respect to Tesda’s organizational structure and capacity,” said ADB Social Sector Specialist Sameer Khatiwada, lead author of the study. “Although Tesda has made major achievements over the years, questions around its appropriate role, endemic resource constraints, and organizational capacity weigh on its ability to respond to Industry 4.0.”
The report recommends that the government seek new and effective ways to secure industry engagement in skills training, such as anticipating skills demand, and ensuring better targeting of skills training programs.
The situation also called for greater efficiency of skills supply, limiting mismatches, and improving labor market outcomes. It also recommended standardizing and improving workshops, equipment, and digital solutions to meet international norms.