Automation to Create New Jobs

Kompas

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JAKARTA, KOMPAS – Automation is to replace as many as 23 million jobs in Indonesia by 2030. Nevertheless, between 27 million and 46 million new jobs can be created within the same period. Opportunities can be grabbed if workers in Indonesia have new skills.

McKinsey & Company has conducted global research that analyzes the impact of technology on the economy, business and society to identify the opportunities and challenges of automation, or the use of automatic equipment.

The research results on the implication of automation in Indonesia were released on Wednesday in Jakarta.

McKinsey Indonesia president director Phillia Wibowo said that automation would change employment structure and job fields in Indonesia, with automation projected to replace 23 million jobs by 2030.

"Our analysis of about 2,000 activities in 800 kinds of jobs shows that some activities are more likely to be replaced with automation," she said.

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The jobs most likely to be replaced by automation are those that rely on repetitive physical work and data processing. The jobs most unlikely to be automated include managerial jobs that require expertise and person-to-person interaction.

"Around 16 percent of jobs in Indonesia could be automated by 2030. This is equal to 23 million workers. All jobs can be automated, even some activities of CEOs, but the degree varies," she said.

On the other hand, new jobs will also be created during the era of automation. Automation is projected to create 27 million new jobs, with another 9 million jobs from an increase in infrastructure and construction jobs, and 10 million other jobs. Indonesia thus stands to gain between 4 million and 23 million net new jobs by 2030.

Indonesia is growing, which will create more jobs. The labor demand in the construction industry and manufacturing sector will increase, as well as in the lodging, food and beverage, education, health and trade sectors. "A number of developed countries will see fewer jobs due to automation," said Phillia.

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Need for transition

The research report also mentions that Indonesia has benefited from digital revolution. For example, companies like Gojek and Grab have created new jobs for unemployed and underemployed people.

E-commerce is another example of how new technology can create jobs. By 2022, e-commerce platforms are projected to provide up to 26 million jobs that are the equivalent of full-time employment.

However, new skills are also needed in the automation era. "The biggest challenge is the transition to prepare the workforce to adapt to change," said Phillia.

According to McKinsey associate partner Vivek Lath, in addition to technology skills, workers needed to develop social, emotional and cognitive skills, such as the creative ability to solve complex problems.

"The educational needs to face the automation era relate not only to hard skills, but also soft skills, like high creativity and meta-skills, namely a change in mindset. It requires a willingness to learn and adapt quickly," he said.

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All stakeholders, including policymakers, educational institutions and businesspeople, must therefore be prepared to face substantial changes in the world of work. Indonesia needs a proactive strategy to implement artificial intelligence and automation to compete in the global and ASEAN markets.

Every company must plan for transitioning through long-term development programs for the employees who will be affected. "The government needs to provide incentives for companies to train their employees to be ready to face change," he said.

(AIK/FRD)