This report explores the implications of the Fourth Industrial Revolution (4IR) on the future of the job market in Indonesia. It assesses how jobs, tasks, and skills are being transformed in food and beverage [F&B] as well as in automotive manufacturing. These two industries have high relevance to 4IR technologies and both are important to Indonesia's national employment, economic growth, and international competitiveness. They are also likely to benefit considerably from the transformational effect of 4IR, if there is adequate investment in jobs, skills, and training. The report is part of th
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This report explores the implications of the Fourth Industrial Revolution (4IR) on the future of the job market in Indonesia. It assesses how jobs, tasks, and skills are being transformed in food and beverage [F&B] as well as in automotive manufacturing. These two industries have high relevance to 4IR technologies and both are important to Indonesia's national employment, economic growth, and international competitiveness. They are also likely to benefit considerably from the transformational effect of 4IR, if there is adequate investment in jobs, skills, and training. The report is part of the series of reports from an Asian Development Bank (ADB) study that assesses how jobs, tasks, and skills are being transformed in industries with high relevance to 4IR technologies in Cambodia, Indonesia, the Philippines, and Viet Nam. The series provides recommendations to strengthen policies, skills, and training as well as new approaches, strategies, and actions to enhance the readiness of each country's workforce for 4IR. The study was undertaken and completed prior to the spread of coronavirus disease (COVID-19), which has caused unprecedented disruptions to labor markets and to the activities of the workforce across the world.
The study finds that 4IR will have a transformational effect on jobs and skills in the F&B and automotive manufacturing industries with great potential for positive gains in jobs and productivity, which can be reaped through adequate investments in skills and training. Key findings from the study include: (1) 4IR will bring positive net job gains in the food and beverage and automotive sectors; (2) 4IR calls for higher order tasks with an expected decline of physical tasks; (3) alleviating skills shortages and augmenting skill levels in both industries is crucial for 4IR; (4) While training institutions report strong engagement with industry, there is a significant mismatch in perceptions on graduate preparedness at the entry level; (5) training delivery needs to embrace 4IR technologies and approaches; and (6) Indonesia's 4IR policies and strategies are in the right direction and need active implementation.
The study, drawing on the findings of employer survey and training institution survey together with an assessment of policy, identifies seven recommendations for Indonesia to strengthen its preparedness toward 4IR. A multi-stakeholder approach to the actions in each of these recommendations will be critical to their effectiveness. For each of them, a potential lead (from either the government or private sector) has been identified, alongside a list of stakeholders suggested to be engaged when developing and implementing the recommended actions. These recommended actions include: (1) develop 4IR transformation road maps for key sectors; (2) develop a series of industry-led [technical and vocational education and training] TVET programs targeting skills for 4IR; (3) strengthen quality assurance mechanisms for training institutions; (4) upgrade training delivery through 4IR technology in classrooms and improved training facilities; (5) develop flexible and modular skill certification programs; (6) implement an incentive scheme for firms to train employees for 4IR; and (7) formulate new approaches and measures to strengthen inclusion and social protection in the context of 4IR. While these recommendations apply to both the F&B and automotive manufacturing industries, the report outlines a set of priorities unique to each industry that should be considered when implementing the respective actions.
Edited excerpts from publication.
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