The increasing use of automation technology (robots) and artificial intelligence (AI) by businesses is creating a paradoxical two-sided impact. On the one hand, it increases productivity and opens up new jobs, but at the same time it also replaces old jobs.

The World Bank report titled "Jobs of the Future: Robots, Artificial Intelligence, and Digital Platforms in East Asia and the Pacific" released June 25, 2025 reveals the paradox of the impact of this cutting-edge technology.

The use of robots reportedly spurred industrial employment growth in China and Vietnam. In Vietnam, for example, the adoption of robots increased employment by 10% and wages by 5%, especially for young and skilled workers.

The report also mentioned that digitalization has the potential to increase services productivity by 30%-50% if accompanied by policy reforms. "East Asia and Pacific countries need to open their services sectors to trade and investment, and equip their workforce with AI-based skills," the report said.

However, the blessings of growth are uneven and not happening in other countries. A total of 1.4 million low-skilled workers in Indonesia, Malaysia, the Philippines, Thailand, were displaced to the informal sector between 2018-2022.

The World Economic Forum (WEF) in its report entitled"Future Jobs Report 2025" states that the workforce that will be absorbed in 2025-2030 in the market is those who master technological aspects. What is meant by technological aspect skills is the use of AI (answered by 86% of respondents), robots and automation (58%).

The research was obtained from 1,000 global companies from 55 countries across 22 industry sectors covering a total of 14 million workers.

New Skills Needed and Gaps

Chairman of the Indonesian Employers Association (Apindo) Manpower Division Bob Azam highlighted the shifting skill needs and adaptation measures taken by the industrial sector in facing this challenge.

Since the last decade, automation and robotization have penetrated various sectors, not only manufacturing but also administrative work. "Those repetitive (technical) jobs are definitely getting smaller and smaller," he told Suar (18/7/2025).

He added that this trend has led to a reduction in the need for general labor that lacks specific skills, even at the high school graduate level. This phenomenon, according to Azam, has led to an increase in unemployment.

This is not only true in Indonesia, but also in rapidly digitizing countries such as China, where the youth unemployment rate is above 30%.

In contrast to the decline in demand for general labor, the need for analytical skills is increasing rapidly. The Vice President Director of PT TMMIN explained that the ease of information flow thanks to digitalization has triggered a huge demand for professions capable of analyzing data.

"The fields of mathematics, statistics, data science graduates are currently starting to grow and are much needed," Azam explained.

However, he regrets that Indonesia's old-style education curriculum tends to produce a workforce with general skills. Meanwhile, industry needs are shifting to talents who are able to work with computers, data, and statistics. This gap is predicted to widen further.

In addition, he also highlighted the urgent need for technicians andmaintenance personnel in the manufacturing sector. He cited the example of the aviation industry in Indonesia, which has thousands of aircraft, but most of the maintenance is still done abroad due to a lack of local experts. Similarly, in the logistics and quality control sectors, experts in these fields are urgently needed to improve the efficiency and competitiveness of companies.

Azam criticized the education sector's slow response in anticipating the needs of the job market.

"The world of our education does not respond well or perhaps the communication is not good, so there is no anticipation of future work needs," he said.

He added that it is difficult to find specific study programs such as electric car majors in Indonesia. In fact, in other countries such as India, such training is already available.

Industry Initiatives and Regulatory Barriers

Realizing this gap, the business world began to take independent initiatives to develop workforce competencies. Bob said that many companies are now developing internal training programs. "Many companies are now developing their own industries, their own training," he said.

Bob hopes that the curriculum developed by the industry can be granted to public schools. However, he admits that there are regulatory obstacles that hinder the adaptation of the curriculum.

For example, the Merdeka Internship program, which lasts six months and is equivalent to 40 credits, is often difficult to integrate into a university curriculum that has a total of 160 credits without reducing existing courses. This can actually extend students' study period.

As a concrete example, the Toyota Academy has now been established to provide specific curricula in maintenance, quality, and logistics that are not found in formal educational institutions.

In addition, associations such as the Indonesia Molding and Dyes Association (IMDIA) apply a collaboration model between companies. "If you want to learn electronics, go to PT Denso, then if you want to learn stamping, go to PT Toyota. Then learn the mechanics from another company," he explains, illustrating how technicians' skills can be consolidated from specific training at different companies.

Bob concluded with a comparison of the education system between Indonesia and abroad. Abroad, for one skill, the material taught is more integrated so that the number of credits is smaller. This makes them more flexible and adaptive to the modules offered by the industry.

Workforce and UMKM Adaptation

Institute for Development of Economics and Finance (INDEF) economist Ahmad Heri Firdaus said that there are various factors that cause labor demand to be dynamic. One of them is the trend of market behavior and technology distribution.

Heri explained that people's desire for efficiency and practicality, as well as the business world's need to increase efficiency and productivity, have given birth to new technologies that can threaten the existence of certain types of jobs.

"Therefore, technologies were born that threaten the existence of the workforce. This is actually a challenge for labor in the future," he told Suar, (18/7/2025).

He highlighted that this change is so fast that it is difficult to predict. "Maybe 10 years ago we didn't think that we would need electric car sales. It's different from car sales," he said.

Another example he mentions is the emergence of jobs such as influencers that were unimaginable before.

In facing these challenges, Ahmad Heri Firdaus emphasizes the importance of adaptation. The workforce must have a program that allows them to adapt to the changes that occur. The same applies to Micro, Small and Medium EnterprisesUMKM).

"If, for example, UMKM still use conventional patterns, old patterns, yes, they will probably be difficult. Because others are already using digital technology," he explained.

Digital adaptation for UMKM is not only limited to marketing, but also includes access to finance, procurement of raw materials, and other operational aspects. Thus, the relevant workforce in the future will be those who can adapt to the dynamics of current conditions.

The implications of this change are also felt in the types of training provided by the government. "So later, the training provided by the government will change. You can't keep training baristas, or sewing training, or welding iron, it can't continue," said Ahmad Heri Firdaus.

He added that there needs to be a focus on the new things needed by businesses in the future, especially considering that many industries have already adopted Industry 4.0.

For the prospective workforce, he advises them to no longer be fixated on conventional job aspirations. "If you are asked what you want to be, look at what the world needs first," he said. Repetitive jobs, such as administration, are very vulnerable to being displaced by systems, artificial intelligence (AI), and robots for reasons of efficiency and productivity.

On the other hand, new job opportunities are emerging that require different skills, such as house life(live streamer) which requires the ability to speak and withstand criticism.

Addressing Labor Mismatch

Indonesia is still facing a mismatch problem between labor supply and demand. Ahmad Heri Firdaus explained that there are two types of mismatch:

• Vertical mismatch: Qualifications required are higher than those available (for example, a bachelor's degree is required but a vocational school graduate is available).
• Horizontal mismatch: The skills required are different from the skills available (for example, digital experts are needed but administrative experts are available).

To overcome this problem, he emphasized the importance of link and match between educational institutions and the business world. "The mismatch is not a link and match. So in the future it must be more link and match," he said.