The Asean+3 Macroeconomic Research Office (Amro), a Singapore-based independent regional surveillance unit, recently said, technological advancements will threaten significant job losses in the Asean region, particularly in least developed economies like Cambodia, and that carefully designed mechanisms need to be put in place in these countries to retrain the workforce.
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In a recent blog post, Amro said the problem of the evolution of technology and its impact on local workforces is particularly pressing for the labour-intensive garment industry and for Cambodia, a country in which about 90 percent of manufactured exports are made up of textiles.
The problem does not materialise in isolation, however, as today’s world presents a complex and ever-evolving reality in which all nations are closely linked through cross-border production and trade, Amro said.
The picture that emerges is a rather nuanced one, where technology-related challenges are complex for economies across the region, and require effective solutions at national and regional level, it said.
“In Cambodia, automation is threatening to take away many of the more than 600,000 jobs performed by workers who are working hard and struggling to move on from sewing machines to much newer, more advanced but also more technology-intensive machines,” it said.
According to the centre, there is still room for optimism, as, at the moment, there are limits on the extent to which the garment sector can be automated or disrupted by technology because of the relatively unstructured nature of the work and the low wages of the workers.
Now is the time for developing economies with lower-skilled workers and more basic technological readiness to upgrade their skills and capacity, Amro said.
“That shift still has to happen in order to be prepared for the Information and Communication Technology (ICT) revolution.”
It added that the most advanced economies in Asia – such as Japan, Korea, and Singapore – are much better-positioned than the rest of the region to face the challenges posed by technology.
In May, representatives of the Asia Development Bank raised similar concerns about the role of technology during the institution’s annual meeting in Manila, Philippines, arguing that a significant loss of jobs in the manufacturing sector as a result of technological advancements can be curbed if proper social policies are put in place.
Last week, the Cambodia Garment Training Institute (CGTI) reached an agreement with the National Employment Agency to make vocational training more widely available in Cambodia and help build up the local labour force.
Andrew Tey, director of CGTI, told Khmer Times at the time that retraining workers is a long-term process.
Mr Tey said Cambodia will still need at least five more years before its industry can move on to more technologically advanced levels of production, adding that courses at CGTI are helping the labour force adapt to higher levels of technology in the industry.
CGTI is an initiative of the Garment Manufacturers of Cambodia (GMAC). The centre opened last year to train local garment workers and increase the competitiveness of the industry.
In its blog post, Amro said that regional economies should strike a careful balance along three dimensions: building capacity for technology absorption quickly, yet managing the pace of technology adoption judiciously; recognising the trade-off between near-term and longer-term economic outcomes; and balancing support for the manufacturing and services sectors.