Technology Transforms Jobs in East Asia, but Inequality Remains a Key Risk

Jobs are not only a source of income—they offer dignity, purpose, and a route to upward mobility. In East Asia and the Pacific (EAP), the rise of industrial robots, artificial intelligence (AI), and digital platforms is reshaping labor markets at a rapid pace. Contrary to widespread fears, these technologies are not causing mass unemployment. Instead, they are redefining the nature of work, productivity, and opportunity, according to the World Bank’s new report Future Jobs: Robots, Artificial Intelligence, and Digital Platforms in East Asia and Pacific.

While technological innovation is expanding access to jobs and increasing wages in some sectors, the gains are distributed unevenly, exposing deep divides in access to technology, skills, and economic opportunity.

Robots in the Factory: More Jobs, But Not for Everyone

The use of industrial robots in EAP countries has increased significantly, particularly in manufacturing sectors such as electronics and automotive production. These robots are now economically viable, especially in high-value sectors, though their cost varies greatly. For example, robots in electronics manufacturing can cost up to 10 times more than those used in simpler processes like rubber or plastics.

In 2022, high-income economies averaged 17 robots per 1,000 manufacturing workers, while China had 12, and Malaysia, Thailand, and Viet Nam each had 8—a notable rise from earlier decades.

Studies across Indonesia, Malaysia, the Philippines, Thailand, and Viet Nam reveal that robot adoption has boosted both employment and earnings. In Viet Nam, areas with higher robot density reported a 10% increase in employment and a 5% rise in labor income. These findings suggest that the productivity benefits of automation can outweigh its displacement effects, creating net job growth.

However, not all workers benefit equally. Between 2018 and 2022, the adoption of industrial robots in these countries created 2 million jobs for skilled formal workers but displaced 1.4 million low-skilled formal workers, particularly older workers in routine, manual roles. Many displaced workers were pushed into informal, low-paying, and insecure jobs. Meanwhile, younger, tech-savvy workers with complementary skills became the primary beneficiaries.

AI: A Double-Edged Sword for Developing Economies

Artificial intelligence is also transforming the job landscape. Unlike industrial robots, AI applications—such as translation tools, financial analytics, and chatbots—can perform tasks requiring cognitive or interpersonal skills. However, these types of jobs are less prevalent in developing EAP countries, where only 10% of the workforce holds jobs vulnerable to AI disruption, compared to 30% in high-income nations.

This disparity suggests that EAP countries may face less risk of AI-related job loss, but it also limits their ability to reap the full productivity benefits of AI. To bridge this gap, countries must strengthen education systems and workforce training, with a focus on digital, technical, and soft skills.

Furthermore, AI offers significant potential in the services sector, where it can improve service delivery, efficiency, and global competitiveness. With appropriate investments and policy support, AI could become a major driver of quality job creation in EAP.

Digital Platforms: Expanding Access but Disrupting Traditions

Digital platforms have become a critical engine for employment and entrepreneurship in the region. Platforms like Alibaba (China), Grab (Singapore), and GoTo (Indonesia) have expanded access to e-commerce, ride-hailing, and food delivery, offering flexible job opportunities for workers who were previously excluded from formal labor markets.

In Viet Nam, for example, informal motorbike drivers saw their incomes rise by 20% after joining ride-hailing platforms. However, these gains came at the expense of traditional taxi drivers, who lost earnings and job security due to intensified competition and changing consumer preferences.

This shift illustrates a broader trend: digital platforms can boost incomes and flexibility but may also contribute to labor fragmentation and erosion of job protections, especially in the informal economy.

Policy Recommendations: Preparing for the Future of Work

The World Bank report outlines a multi-pronged policy agenda to ensure that technology enhances rather than erodes job quality and equity in East Asia and the Pacific.

1. Invest in Skills for the Digital Age

Governments must prioritize education and training to help workers acquire technical, digital, and socioemotional skills that complement automation and AI. Lifelong learning systems, vocational programs, and online learning platforms should be expanded and made more accessible.

2. Enable Mobility of Capital and Labor

Labor and capital should flow more freely toward high-growth sectors and regions. Removing barriers to internal migration, simplifying business entry and exit, and improving urban infrastructure can support smoother labor transitions.

3. Fix Price Distortions

Tax structures that inadvertently incentivize automation over employment—such as capital tax breaks and high payroll taxes—should be rebalanced to avoid distorting technology adoption.

4. Strengthen Social Protection

As digital and gig economy work expands, governments must build adaptive social safety nets that support informal workers and provide coverage for unemployment, health care, and pensions.

A Changing Future Demands Action Now

As technology adoption accelerates and becomes more affordable, its effects on jobs will intensify. Countries that act now to prepare their workers and institutions will be better equipped to harness technology’s full potential.

The World Bank has launched a series of in-depth studies examining the intersection of technology, productivity, jobs, and green growth in the EAP region. These reports provide country-specific strategies and sectoral insights to help policymakers adapt and lead in an era of transformative change.

While robots and algorithms are reshaping the labor market, people remain at the center of economic development. Ensuring inclusive growth means ensuring technology works for everyone—not just the few.