THE National Economic and Development Authority (Neda) said the use of Artificial Intelligence (AI) is inevitable for the Philippines.
And, knowing the Filipino worker, Socioeconomic Planning Secretary Arsenio M. Balisacan thinks AI is not a threat.
He said what is needed is a flexible workforce that can and will embrace AI to become more efficient. Balisacan pointed out there are advantages to being open to AI.
“AI, I’m not so worried at all. Because if you become worried if you are not doing anything about it, just like the emergence of internet or the emergence of computers,” Balisacan recently told reporters.
“We have to retool. We have to use this as new tools rather than things that will replace us. That’s [how] I also see AI,” he added.
Citing examples of how AI can be tools to achieve greater efficiency, he said ChatGPT or Grammarly can help craft better letters or researches. Preventing AI from being used will only delay the inevitable, he said.
The Neda chief said this is similar to the advent of the internet. If everyone shunned the use of internet, the world would have been in a worse state.
“In the end, our response should be, we would want a labor force that is truly agile, flexible, and [can] adjust to these technologies and challenges,” Balisacan said.
Labor market
Efforts to improve the chances of workers in the short- to the long-term will be included in the upcoming Trabaho Para sa Bayan (TPB) plan.
The plan hopes to address the needs of a changing labor market. Balisacan noted that the problem in terms of unemployment and underemployment as well as the decrease in labor force participation would be included.
Balisacan attributed the decline in the labor force participation in January 2024 to workers who opted out of the labor force because of back-to-work orders.
In January of 2023, he recalled, many were working from home but still fully employed. But when returning to the work site became mandatory, “perhaps that’s when many withdrew from the labor force,” Balisacan explained, partly in Filipino.
Wage hike fallout
However, in terms of wages, the proposals to increase wages across the board lodged at the House of Representatives and Senate of the Philippines may not be immediately considered in the Trabaho Para sa Bayan (TPB) plan.
Balisacan noted that the main view of the TPB plan would have to be long term. This is why the start of the planning exercise will be the 10-year view between 2025 and 2035.
Earlier, the Neda warned that thousands of Filipinos could lose their jobs, and the economy could suffer significant losses, due to the proposed P100 wage hike.
In an online forum last month, Balisacan said the P100 wage hike could render 100,000 to 340,000 Filipinos jobless.
Given this, Balisacan said GDP growth could be reduced by 0.1 percentage points (ppts) to as much as 0.5 ppts, which he considered “significant.”
Balisacan said the country’s unemployment rate could increase by 0.2 ppts to 0.7 ppts. This could also lead to an increase in inflation by 0.2 ppts to as much as 0.8 ppts.
The extent of the impact will greatly depend on how the wage hike will be implemented. The impact will be less severe if it covers only minimum wage workers.