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South-east Asia automation could see labour unrest

Monday, September 19, 2016

Subject

Outlook for automation in South-east Asia and its implications.

Significance

Cambodia's garment industry started its annual minimum-wage-setting talks on September 9. The sector is just one that will be affected by automation. The International Labour Organization (ILO) said in July that 137 million workers are at risk of losing their jobs in Thailand, Cambodia, Vietnam, the Philippines and Indonesia over the next 20 years from the automation of manufacturing and services, potentially creating social strains and damaging growth prospects in the event that work leaves the region.

Impacts

  • Automation's economic impact will be most felt by low-income countries with narrow manufacturing bases, such as Cambodia.
  • Labour-intense industries (eg, clothing) could leave South-east Asia once technology changes end the need for offshoring production.
  • Women will be disproportionately affected due to their over-representation in automation-exposed industries.
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