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For companies in Asia, automation and AI are no longer the future, they are here and now and making their impacts felt, and as this trend intensifies over the next five years businesses need to be well placed to respond to the future of work, according to recruiting experts Hays.

 

In a new report launched by the Economist Corporate Network and sponsored by Hays, ‘Automation, AI and the Future of Work: The role of the CEO in shaping tomorrow’s workplace in Asia’ surveyed more than 500 business leaders across Asia to share their thoughts on automation, AI and the challenges and opportunities they bring to companies’ future workplace strategy.

 

“The role of automation and AI in the workplace has been one of the key talking points among business leaders in Asia the past year, but the discussion is no longer just about what will happen in the future,” says Simon Lance, Managing Director for Hays in Greater China. “51.5% of CEOs surveyed say that their business has already started to feel the impact from the new technologies that make automation possible.”

   

More than 40% of business leaders stated that they anticipate that AI will start displacing humans from some jobs in their industry within the next five years, while 72.2% of respondents say that they expect their businesses to feel the full impact of automation within the same time period.

 

Almost two-thirds of those surveyed think that their businesses will be strongly or extremely affected by automation and AI. They agree that the biggest impacts include increasing the scale and speed of their operations, and increasing worker productivity. In addition, CEOs also think automation and AI will improve relations with their customers, reduce costs, create new types of jobs that do not currently exist, and help with optimising training and learning outcomes in the workplace.

 

However, automation and AI do not always have a positive impact on business. Among the potentially negative impacts are creating redundancies, making certain job categories obsolete, and changing existing work habits and patterns.

 

Although there is consensus that technology will affect the workplace, the majority of CEOs understand that automation and AI will have different impacts on different workplaces and different workers within the same workplace. Of those surveyed, 56.2% think that the biggest changes automation and AI will have are bringing more flexible working arrangements and less formal employment types. While this may reduce job security for some, almost 15% of CEOs cited shorter working hours as the top potential impact from automation and AI.

 

For workers, the impact of automation and AI will be unevenly spread. Most CEOs (64%) think that older workers will either be strongly affected or extremely affected, whereas only 33.7% think the same of younger workers. In terms of skills, an overwhelming 74.2% of CEOs expect low-skilled workers to be strongly affected or extremely affected. By contrast, only 49.4% of respondents think that high-skilled workers will be moderately affected.

 

The fact that respondents do not expect high-skilled workers to be affected to the same extent as other workers is likely related to the fact that automation and AI will have different impacts on different kinds of skills. A large majority of CEOs surveyed think that on the one hand, hard skills and technical skills will be less important due to automation and AI, whereas on the other hand soft skills and people skills will be more important.

 

It is clear that automation and AI are having a dramatic and wide-ranging impact on the economy and society in Asia. Nowhere in Asia is this transformation more apparent than in China, which is pioneering AI applications, and is in fact far in front of mainstream global practices in several respects, from e-commerce to mobile payments. Such applications yield massive troves of data, which in turn support the development of new AI applications. 

 

CEOs from China feel that the social implications of redundancies and the extinction of job categories caused by automation and AI are already being experienced. This perhaps explains why business leaders in China are more active in preparing for the workplace of the future and putting strategies in place to deal with the risks. Of the Chinese CEOs surveyed, none said they are passively dealing with risk, compared to 16.7% overall across Asia.

 

During discussions in Shanghai and Beijing, business leaders there acknowledged that as robots and machines become more and more intelligent, we might have a large segment of people who may not have jobs. It is clear that this is an issue that companies think seriously about too, and not just the government. Looking at the bigger picture, CEOs in China believe that the government and business need each other in the face of the uncertainty that automation and AI bring.

 

Throughout Asia, automation and AI will continue to impact on business and employment, even if the impacts will be felt differently from country to country, industry to industry and job to job. Yet businesses can be doing more to prepare, specifically with regards to HR. 

 

The report notes that a large majority of CEOs think that it is highly important or extremely important to hire new workers with the right skills, re-train existing workers, educate executives, review HR practices and update IT infrastructure to leverage technology to shape the future of work. However they are not putting enough importance on reviewing their HR practices or involving recruitment specialists to hire key new workers. Without adopting a holistic approach that includes giving HR a seat at the table to reshape the business to prepare for automation and HR, companies will be missing a golden opportunity.

 

“If companies want to successfully pre-empt risks, pursue opportunities and leverage technology to shape tomorrow’s workplace, they may need to involve HR specialists more closely in their automation and AI strategies,” says Simon.

 

Hays plc (the "Group") is a leading global professional recruiting group. The Group is the expert at recruiting qualified, professional and skilled people worldwide, being the market leader in the UK and Asia Pacific and one of the market leaders in Continental Europe and Latin America. The Group operates across the private and public sectors, dealing in permanent positions, contract roles and temporary assignments. As at 30 June 2017 the Group employed 10,000 staff operating from 250 offices in 33 countries across 20 specialisms. For the year ended 30 June 2017:

 

– the Group reported net fees of £954.6 million and operating profit (pre-exceptional items) of £211.5 million;

– the Group placed around 70,000 candidates into permanent jobs and around 240,000 people into temporary assignments;

– 24% of Group net fees were generated in Asia Pacific, 49% in Continental Europe & RoW (CERoW) and 27% in the United Kingdom & Ireland;

– the temporary placement business represented 59% of net fees and the permanent placement business represented 41% of net fees;

– Hays operates in the following countries: Australia, Austria, Belgium, Brazil, Canada, Colombia, Chile, China, the Czech Republic, Denmark, France, Germany, Hong Kong, Hungary, India, Ireland, Italy, Japan, Luxembourg, Malaysia, Mexico, the Netherlands, New Zealand, Poland, Portugal, Russia, Singapore, Spain, Sweden, Switzerland, UAE, the UK and the USA.