Making the “future of work” work for Southeast Asia

Lim Yew Heng, Grab’s Group Managing Director for Public Affairs, shares thoughts on how Southeast Asia can prepare for the future of work.

Work is always evolving. The first industrial revolution in the late 1700s was disruptive, but paved the way for massive increases in productivity. More recently, globalization, rapid digitalization and the COVID-19 pandemic have once again made us question what the future of work will look like.

These changes are happening in Southeast Asia too. Our region has a large and dynamic young population with skyrocketing digital penetration rates. The future of work is a vast topic, and I won’t try to be comprehensive. I will instead focus on where our region is headed in terms of our work, workplaces and the workforce. I will also share some thoughts on how we can prepare for the road ahead.

The Future of Work

The Work

Digital platforms have created new gig work opportunities

Digital platforms like Grab have become ubiquitous In Southeast Asia. They are digital marketplaces that facilitate economic activity between consumers, business owners and workers. It is a thriving scene – seven in 10 Southeast Asians use such platforms and one in five MSMEs leverage them to scale their business.

These digital platforms create value for all involved. For instance, MSMEs could serve new and existing customer segments during COVID-19 by relying on delivery-partners, who in turn made a living from the work opportunities created. Consumers benefited from convenient access to daily essentials, all without leaving home. 

Gig work provides an entry point into the broader digital economy

But isn’t the gig economy taking away precious resources from formal jobs? This is fair  – gig work should not replace but complement formal work. However, the risks are often overstated in Southeast Asia, where over 70 percent of all work is informal to begin with – such as street vendors, ad-hoc daily wage earners and others.

Compared to informal work, digital platforms provide the option of a flexible, more predictable and accessible income source. For many informal workers who reside in off-grid areas, platform-mediated work draws them into the broader digital economy. This gives them access to digital services and is a springboard for digital inclusion that can also help level the gap between urban and rural areas.

Demand for both technical and soft skills will rise as technology changes the way we work

Increasingly, companies leverage technology such as AI or robots to reap efficiencies from automation. Tasks once reliant on human labor can now be completed in half the time using technology. Workers need to retool to stay relevant.

The need for hard digital skills such as programming will skyrocket. New skills may also be required in the future; up to 85 percent of the jobs we may see in 10 years do not exist yet today. However, demand will also rise significantly for soft skills such as leadership and people management, which are less replaceable by technology.

Priming the workforce for these changes will not be easy. This is a huge transition for Southeast Asia. In the beginning, there may be struggles with mismatches between job demands and workers’ skill sets. Governments and companies can ease the transition by investing in developing the necessary infrastructure to help workers retool, and reap the rewards of a higher skilled workforce.

The Workplace

Rise in digital nomads set to benefit local communities

The physical workplace is less relevant today. The COVID-19 pandemic enhanced the need for remote work. Aside from easing traffic congestion in crowded city centers, this has also given rise to the “digital nomad” – one who leverages technology to complete work in a location-independent manner.

Southeast Asia stands to benefit. As a welcoming tropical region, digital nomads bring benefits to local communities – consuming services such as food, entertainment and transport. Many countries including Thailand and Indonesia offer visas to attract international remote workers to their shores.

Global outsourcing creates new work opportunities for Southeast Asians

With remote work on the rise, global outsourcing will likely also grow. Southeast Asian countries such as the Philippines, Indonesia and Vietnam are emerging as ideal outsourcing destinations for global companies, given their economic dynamism and workforce competence. For locals, this expands the range of work opportunities available to them. There is the option to work flexibly, gain exposure via multiple global gigs, and manage their own time.

The Workforce

Workers’ priorities are shifting – flexibility and fragmentation are the new norm at all skill levels

There is the commonly held perception that gig work is reserved for lower skilled workers. However, this is a misconception – the flexibility of gig work attracts many white-collar professionals too. Across the board, likely prompted by the pandemic, we are witnessing “The Great Resignation”. After experiencing working from home, many professionals value the increased autonomy and balance that the gig model offers. Many have quit corporate roles in favor of flexible gigs.

The “multi-earner mentality” is also on the rise. Workers seek to generate multiple income streams through several informal gigs, such as monetizing content on platforms like YouTube, performing deliveries for Grab, while hustling to build their start-up – all at the same time. The low set up costs involved, combined with the flexibility to explore various options, are also fueling this trend.

Lastly, loyalty to one company may be a thing of the past. Workers are less likely to stay with one employer and work their way up the ranks, and instead actively seek out new opportunities. Even in more traditional contexts such as Southeast Asia where job-hopping may be frowned upon, 60 percent of employees surveyed in the region were likely to accept a better job opportunity elsewhere while having been in their current role for under a year.

Preparing for the Future of Work

Four things that Southeast Asian governments, companies and workers can do

With the winds of change blowing our way, how can companies and governments help workers in Southeast Asia prepare for the future of work? I have four ideas:

First, governments can work across sectors to promote the uptake of new in-demand skills. For instance, in Malaysia, the government is collaborating with universities to launch Massive Open and Online Courses (MOOCs) to promote open source learning. In Cambodia, the government launched upskilling programs with NGOs for young workers, focusing on digital literacy. Singapore’s SkillsFuture program is another example of the push towards constant upskilling.

Second, policymakers should consider decoupling worker benefits from their place of work. As flexible and fragmented work become more popular, policymakers should explore how to redesign existing schemes to make benefits universal to workers no matter how they choose to work.

Third, companies should think about how to make their work and culture more attractive. Key to this is tuning in to shifts in workers’ priorities, especially top talents engaged in fractionalized work. As expectations change, companies may have to redesign their missions and policies to embody important values to workers, such as people-centricity and culture, to make work meaningful.

Finally, workers need to be agile and nimble in navigating these changes. Workers will need to embrace lifelong learning as new trends emerge that require constant reskilling. Meanwhile, unions can also play a key role in shaping the future of work – advancing workers’ interests and concerns collectively as they navigate this new landscape.

It is natural to feel both excitement and uncertainty during times of change. But indeed, good fortune favors the prepared. With thoughtful preparation from all stakeholders, we can together make the future work for Southeast Asia.

Cover photo credit:

Komsan Chiyadis

GrabFood delivery-partner, Thailand

Komsan Chiyadis

GrabFood delivery-partner, Thailand

COVID-19 has dealt an unprecedented blow to the tourism industry, affecting the livelihoods of millions of workers. One of them was Komsan, an assistant chef in a luxury hotel based in the Srinakarin area.

As the number of tourists at the hotel plunged, he decided to sign up as a GrabFood delivery-partner to earn an alternative income. Soon after, the hotel ceased operations.

Komsan has viewed this change through an optimistic lens, calling it the perfect opportunity for him to embark on a fresh journey after his previous job. Aside from GrabFood deliveries, he now also picks up GrabExpress jobs. It can get tiring, having to shuttle between different locations, but Komsan finds it exciting. And mostly, he’s glad to get his income back on track.