Preparing for the future of work: National policy responses in ASEAN +6

ILO: Future of work strategies in Asia-Pacific should focus more on people than technologies

While planning for technological advancement takes top priority in national growth strategies across Asia-Pacific, ILO report highlights gaps in country policy responses to support people through future of work transitions.

News | 16 September 2019
BANGKOK (ILO News) –As countries respond to forces shaping the future of work, their primary focus is to promote technological advancement to boost economic growth with insufficient attention given to creating decent jobs, finds a new ILO report entitled Preparing for the future of work: National policy responses in ASEAN +6.

The report provides a mapping of national responses* to trends like technological advancements, demographic shifts and climate change in ten ASEAN countries and their six main trading partners**, assessing their capacity to shape a future with decent work for all.

“Promoting a sustainable and inclusive future of work that can benefit all and not just a few, requires increased investments in social protection and action to reinforce the institutions of work. Otherwise, the future of work in many ASEAN countries is expected to look a lot like today, when still one in three workers lives in poverty and one in two workers remains in the informal economy,” says Sara Elder, ILO Senior Economist and main author of the report.

The report stresses that the future of work in the ASEAN region is set to be a residual of how successful the countries are in meeting their objectives of their industrial growth strategies in the given uncertain macroeconomic context.

“Putting people and the work they do at the centre of economic and social policy is the way to drive forward an inclusive and sustainable growth for current and future generations,” says Tomoko Nishimoto, ILO’s Assistant Director-General and Regional Director for Asia and the Pacific.

According to the report:
  • ASEAN +6 countries take a positive view of technological change and many now have distinct Industry 4.0 plans, but still many countries in the region have limited incentives to invest in technology for productivity gains given the continuing surplus of low cost labour.
  • ASEAN emerging economies are pushing for targeted manufacturing sectors to move to digital technologies to boost productivity growth while low-income countries strive to keep up.
  • Countries react to demographic shifts, with the ageing economies making progress on policies intended to encourage active ageing and to extend the working lives of the elderly. Although the pace of ageing differs between countries, the median age of the labour force is rising in all ASEAN+6 countries. The report warns that the continuing underspend on national old-age pensions will exacerbate old-age income insecurity and burdens on families to care for elderly parents.

    Median age of the labour force (years), 1990–2030
  • All countries reviewed increasingly adopt strategies to address environmental and climate change. But still more and larger investments in the green economy, including for renewable energies, are needed to put the region on an environmentally-sustainable base. Although ASEAN +6 countries are ahead of the rest of the world in terms of the absolute number of renewable energy employment (left panel below), renewable energy employment still accounts for a small proportion of the total employment in each of the individual countries (right panel below).

    Share of renewable energy employment in total employment (per cent), 2018

Skills and the future of work

Within each of the three areas considered – technology, demography and environment – the most common labour market interventions noted in the analysis fall in the realm of skills development. Significantly less attention is paid to social protection, labour migration, employment services, vulnerable groups and labour law reforms.

With rapid advances on the technological front, the report finds a broadening consensus that the future of work will require a highly-skilled workforce even though the current demand for high-skilled workers in the region remains quite limited (see chart below).

Employment share in high-skilled occupations (per cent), 2017

“With the majority of work in the region still low-skilled,  it is important that such work is not overlooked by policymakers,” says Sara Elder. “As labour shortages will increase with population ageing, we would hope that wages will rise and conditions of work will improve for low-skilled workers as their market value increases. But such gains will come only if supporting policies are put in place.”

Strengthened institutions of work needed to support transition

While the report highlights examples of innovative actions that can help to promote decent work as part of national future of work planning, it also finds important shortcomings in countries that struggle to strengthen the institutions needed to deliver economic security, equal opportunity and social justice in the years to come.

“The more obvious gaps relate to national capacities to support people through their future of work transitions, provide adequate social protection, pursue gender equality, adequately address labour standards and promote collective representation of workers and employers,” says Sara Elder. “Scaling-up progress on each of these fronts is what is required to put people first in the path to a “brighter” future of work.”

*The resulting inventory of national response to the three future of work themes are presented in three Annex documents which are available as separate e-documents: Annex 1 on the theme of technological changes, Annex 2 on demographic changes and Annex 3 on environmental and climate change.

** ASEAN +6 includes ten ASEAN member States – Brunei Darussalam, Cambodia, Indonesia, Lao People’s Democratic Republic, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Viet Nam – and six trading partners– Australia, China, India, Japan, New Zealand and the Republic of Korea.

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