The jobs sector has been severely impacted from both the demand and supply side. Mass layoffs have grown in incidence, with some attracting more controversy than most. On the other end, the shift to working remotely took a heavy toll on many employees amid the COVID-19 crisis, as the space narrowed between work and personal time for those working from home. Perhaps unsurprisingly, the pandemic also put a spotlight on mental health, with most companies having to address employee wellbeing under the shadow of a global crisis.
The future of Asia’s job market looks uncertain as it is “compounded by economic and geopolitical disruptions and growing social and environmental pressures.” A recent report by the World Economic Forum states that in the next five years, the world will witness a reduction of 14 million jobs or 2% of current employment. Between 2023-2027, 83 million jobs are projected to be lost, while 69 million are expected to be created. This will lead to a labour-market churn impacting 152 million jobs.
Exhibit 1: Projected job creation and displacement, 2023-2027
Clerical jobs in sectors such as banks, post offices, accounting and administration are expected to face the greatest number of job losses in the next five years. Meanwhile, most of the new jobs created will be in the areas of emerging technologies such as AI and machine learning, big data, fintech and robotics.
The report also reveals that most organisations in East Asia and the Pacific are investing in the development of skills such as analytical thinking, AI and big data, and creative thinking. Additionally, more than 3 of 10 (32%) organisations in the region are using on-the-job training and coaching, followed by internal training (25%) to cope with future reskilling and upskilling needs of their employees.
Exhibit 2: Skills being prioritised in East Asia and the Pacific
Meanwhile, 77% of organisations in East Asia and the Pacific have DEI (diversity, equity and inclusion) programmes, which is more than the global average of 67%. More than half, i.e., 56% run DEI training for managers, followed by 45% that run comprehensive DEI training for their staff. Nearly all, i.e., 96% of organisations from the region prefer funding themselves for these training, upskilling and reskilling efforts.
Exhibit 3: Key components of DEI programmes
Nearly half (49%) of organisations in East Asia and the Pacific also have plans to improve talent progression and promotion processes. Some of the top practices they are implementing are offering higher wages (34%) and providing effective reskilling and upskilling (33%). Meanwhile, some (20%) offer more remote and hybrid work opportunities, with 18% supporting employee health and wellbeing.
In 2027, organisations from East Asia and the Pacific estimate that the balance between the improvement and decline of talent availability when hiring will remain similar. On the other hand, 75% estimate that talent development of existing workforce will improve exponentially, while 43% expect better talent retention of their existing workforce.
Exhibit 4: Talent outlook in 2027
Moving forward, it is imperative for policymakers and employers alike to have mechanisms in place to counter the impact of potential job losses, stimulate job creation in strategically targeted industries, and capacitate the workforce with skills that will help them stay relevant in the labour market. Today’s leaders will certainly need to take proactive steps in making thoughtful and timely policy and investment decisions that will produce better outcomes for the future of work in the region.