Fears over shrinking workforces driving automation
China and Australia offer good examples of government support for automation galvanising businesses. But across APAC, long-standing concerns around shrinking workforces also drive business desire for new technologies.
Worldwide business concerns over a shortage of skilled workers hit a record high in the second quarter of 2018. Across APAC, 48% of firms cited skilled worker shortages as a constraint on growth. This is up from 43% the previous quarter.
Business leaders are keen to avoid overreliance on a shrinking pipeline of people with select skills. Competition for these individuals will become even more fierce and inevitably some businesses will lose out. Automating certain roles offers a potential solution to these workforce challenges.
![Challenges facing APAC in Q2 2018]( "Challenges facing APAC in Q2 2018")
Robot revolution could jeopardise human jobs
While robots may help businesses solve skilled worker problems, they threaten to create a different challenge by replacing some back-office servicing jobs. Some workers will benefit from being freed up to work in other areas of the business. Others may find themselves surplus to requirements.
Earlier this year, the Asian Development Bank cited concerns that automation “could cause widespread job loss, slow wage growth and worsen income inequality”.(iv) In 2016, the International Labour Organisation estimated that automation will threaten the jobs of more than half the workforce in South East Asia – 137 million people – over the next two decades.(v)
Opinions vary on the number of job losses that will occur as the automation of some business processes evolves. But increased and prolonged unemployment will hinder consumer spending power and could ultimately hold back economic growth.
Aside from the impact on people, automation presents other issues which business leaders should consider. For example, there are concerns that replacing humans with robots will cause an exponential increase in energy use. Others argue that workplaces without people could save energy in other areas, such as air conditioning and lighting.(vi) These factors will impact each business differently.
Embrace automation with eyes wide open
Our research offers compelling evidence that APAC businesses are positive about automation. However, while the robots are coming, so too are challenges of a very human nature.
As Ian Pascoe, CEO and Managing Partner at Grant Thornton Thailand, says: “The future of the workplace will inevitably include machines. But people are integral too. As businesses adapt to this new landscape, there is an opportunity to combine the best attributes of human and robot workers. Done correctly, human and machine should be better than human or machine alone.”
Conducting risk assessments will help firms address automation challenges, exploring how factors like workforce displacement and energy use might affect their growth plans. There is also a role for policymakers in addressing the potential societal impact of workplace automation.
(i) Source: International Federation of Robotics, 2017
(ii) Source: CNBC, 2018
(iii) Source: Financial Review, 2018
(iv) Source: Asian Development Bank: ADO 2018
(v) Source: International Labour Organization: ASEAN In Transformation, 2016
(vi) Source: Bloomberg, 2017
