"East Asia and Pacific (EAP) countries have successfully created stable employment for its people. But industrial robots, artificial intelligence (AI), and digital platforms are affecting labor markets in the region. New evidence reveals that the introduction of new technologies has led to increased employment due to stronger productivity and scale effects compared to labor-displacing effects.
However, the benefits of new technologies have been uneven, favoring skilled workers while displacing less skilled ones, some of whom have moved to the informal sector. The pace of technological adoption in one sector has also influenced economic viability in other sectors by affecting wages and prices, thereby impacting intersectoral labor flows. For instance, many workers transitioned from agriculture to manufacturing not because of agricultural mechanization but because of the attractive opportunities in manufacturing.
Looking ahead, digitization is expected to enhance the tradability of services, and artificial
