Humanizing the workplace

Keynote address at the 2018 AmCham Talent Summit of the American Chamber of Commerce of the Philippines

By Mr Hideki Kagohashi, Enterprise Development Specialist, ILO Country Office for the Philippines at the 2018 AmCham Talent Summit of the American Chamber of Commerce of the Philippines, Manila, Philippines, 25 September 2018

Statement | Manila, Philippines | 25 September 2018
  • Mr Hinchliffe, Mr Cecilia, and Ms Sorongon along with officers and members of the American Chamber of Commerce of the Philippines;
  • Distinguished officials from the government, workers, HR practitioners, employers’ organizations, chambers, and businesses;
  • Ladies and gentlemen, good morning!
First of all, I would like to extend my deep appreciation to the American Chamber of Commerce for inviting me to speak at this year’s Talent Summit. I am honoured to be among HR professionals and business leaders, who are at the forefront of the changing world of work.

I would also like to congratulate AmCham and its members on this initiative and for your active engagement towards a shaping a future of work based on decent work and social justice for all.

This year’s theme “Humanizing the workplace” is very timely. The ILO, the oldest United Nations specialized agency, which was established even before the UN, will mark its 100 years or centenary in 2019.

The future of work is one of the ILO initiatives for the Centenary and part of its activities over the past three years with governments, employers, workers, as well as the academia and partners.

The ILO has undertaken in-depth researches and extensive dialogues in order to provide analytical basis in addressing the challenges of the rapidly transforming world of work.

For the Philippines, the ILO is collaborating with the BPO industry association to deal with the rapidly changing jobs and skills demands of the numerous female workers in search of new set of soft skills the market demands in the age of automation and AI. We have the project team attending this Summit today. They are the real inspiration for bringing the conceptual framework of the future of work into the realities of business, work and policies.

We are living in a time of great uncertainty. That is leading people to question the capacity and readiness of our existing policies, mechanisms and institutions. To me, this is the key challenge of today, and we’ll get back to this issue later.

Let us begin with the popular question on the future of work - are we optimistic or pessimistic about the future of work? Overall, we seem to hear more optimistic views these days (I’m not saying we are or we are not). There have been several waves of technological change in the past as there is always a quest for improving productivity that drives the development of labour-saving process technologies.

The introduction of ATMs in the United States feared many for the elimination of bank teller jobs, but the banking industry continued growing without massive retrenchment of the tellers. The introduction of the internet in France has destroyed 500,000 jobs within 15 years, but created 1.2 million new jobs. These are the encouraging evidences of technological changes leading to net job creation that the ILO cites .

But, the past history will not eliminate the question – “is this time different?” It is indeed fearful to see the speed of automation and the application of the AI around the world. There are many projections made, but nobody has a crystal ball. So, we cannot tell exactly how many jobs will be created, destroyed and re-defined with the unfolding of the Fourth Industrial Revolution.

There is one important argument that supports the optimism, though. It says that technological advances including automation and artificial intelligence are seen to complement humans (not replace humans). They will enhance and extend the human capability and potential.

In fact, the latest discussion on the possibility of the technology-induced job displacement seems to focus on the emergence of new occupations. In the area of so-called “man plus machine”. Instead of “man vs. machine” or mere replacement of jobs by the automation and the artificial intelligence (AI), the experts are talking of new job categories that are emerging. That is where people’s ability is multiplied by the use of AI or supplementing the performance of AI in the real business context.

The first category of the emerging “man plus machine” jobs is the trainers. Those who train the physical robots and the AI software. Increasingly, the automated factories are letting robots to work side-by-side with humans. Although the complete human-less factories and retail shops exist, a study with BMW found that human-robot interactions in the car plant were about 85 per cent more productive than either humans or robots on their own.

These robots need to be programmed and trained to handle different tasks while assuring safety for the human co-workers. The customer service chatbots in the BPO industry need to be tweaked to detect the complexities and subtleties of human communication. You know that Apple’s Siri and Amezon’s Alexa can respond with sympathy and wits these days thanks to the human trainers behind them. They are called “emphathy trainers” – the individuals who teach AI systems to display compassion.

The second category of new jobs is the explainers. The explainers of what AI systems tell us as the AI recommendations may sometimes go against the conventional wisdom or could be controversial. Companies that deploy advanced AI systems will need skilled employees who can help explain the inner workings of complex algorithms. Some of these jobs include “algorithm forensics analyst,” “transparency analyst”, and “explainability strategist”.

The third category of new jobs is the sustainers. The examples of these jobs include “AI safety engineers”, “ethics compliance manager”, “automation ethicists”, and “machine relations managers”.

Never mind what exactly each of these new jobs would mean. The point is that, in the rapidly changing skills requirements, who will get these new jobs. And, more importantly from the HR perspective, can our present workforce be retrained to fit to these new jobs categories. Form the labour market perspective, whether those who lose jobs due to new technologies could be retrained and find new jobs in the present active labour market policies.

Will the workers of the conventional factories be able to get any of these new jobs? Will the conventional call center operators be able to transform into any of these new jobs? How can we manage the transformation of jobs and skills requirements? These are the human capital questions for the corporate mangers. And for the designers of new generation labour market policies.

Two more factors affect our human capital transformation scenario – the different state of national economies and the enterprise sizes.
It is important to note that effects will vary significantly for countries depending on their innovation activities, integration into the global value chains and skills and adaptability of their workforce. Some countries may gain more, some countries less. Whether your country may act upon it, for sure many others will including the most dynamic economies of the emerging Asia.

An important insight in this context is the existence of the “threshold skills.” That is an insight arising in the Women in STEM Workforce Readiness and Development project with selected “tech” industries in the Philippines, Thailand, Indonesia and so on. For example, the cognitive skills such as problem solving skills are known to be required in many of the emerging jobs. In the better functioning active labour market policy cases of the Western Europe, the retrenched workers are “retrainable” because these skills were built in through the formal education system. But, in many developing economies, they are not. Will the programming skills become a type of threshold skills in the BPO industry? Where the once-popular medical transcripters are going when they are replaced by the medical coders and programmers.

Without the “threshold skills”, the upskilling/reskilling/retraining could be a paper dream. You see the public goods nature of the threshold skills here. How to address the threshold skills at the societal level is probably the biggest challenge of the next decades, particularly for the ASEAN economies in the midst of the rapid transformation with the automation and AI.

The micro, small and medium enterprises are another weakest link. They may face challenges with technology adoption, and may be easily left behind.

In a survey conducted by the ILO on the status of technological uptake by enterprises in the Philippines, only 19 per cent reported in investing in research and development while only 14 per cent reported in protecting intellectual property. Moreover, 30 per cent of the enterprises in the Philippines reported fixed capital costs as the leading obstacle in upgrading technology, with high licensing costs associated with technology upgrading as the second largest impediment at 16 per cent. We need to add the gender bias on the techie jobs that will be high on demand.

Combine this with the continuing rise of the platform business models that challenge the existing businesses. Not only the hotels and taxis, but more industries are being challenged with the new platform business models such as the food delivery, the shared bicycles, the mobile monies and so on. At the global level, how the decent work agenda will be affected by the further concentration of powers into a few corporations is debated.

Of course, there are some good news. New technologies are providing new opportunities for the growing number of tech start-ups in the Philippines and the potential for rural entrepreneurs is huge. However, many existing businesses and their workforce have to deal with the disruptive impacts of the new platformers.

Having said these, you know that ILO’s standard recommendations remain the same:
  • skills policies so that workers are employable;
  • social protection systems that provides workers with income security in the transition between jobs;
  • social dialogue at all levels; and
  • just transition strategies for workers who will be displaced.
What is different in the contemporary context of the future of work are the critical new elements in each. Skills required in the age of the AI will be very different from the typical skills being taught at the technical and vocational institutes. The social protection system will have to take into account the growth of the non-standard forms of employment that is partly propelled by the gig economy. The evolution of the new off-shoring and re-shoring with the Industry 4.0 will complicate the social dialogue mechanism. The just transition scenario has to deal with the “threshold skills” among others. Just to point a few.

During the past three years, we have witnessed the evolution of the future of work debate in the context of the ASEAN and the Philippines. It was initially difficult to discuss beyond the looming risk of job displacement. Today, we have so many experts providing diverse evidences, projections and views on the topic. We are very grateful to the American Chamber of Commerce of the Philippines for making this Summit possible. Particularly because the role of the business sector and the organizations of employers and the business membership organizations is critical in order to achieve decent and productive work for all in the age of automation and AI.

I am sure that today’s Summit will make yet another important contribution to this one of the top agendas of today. I look forward to the productive and inspiring discussion.

Thank you!