The COVID-19 massive unemployment problem: How do we adapt?

By: Zhihan Lee

Ashoka Fellow Zhihan Lee reflected on this huge challenge last year, but with the Philippines going on its second year of hard lockdowns, we felt that it was timely to share his thoughts as a compass to guide us moving forward. This is the first article in a three-part series. Read Part 2 and Part 3.

Since the early 2010s, job displacement due to the fourth industrial revolution has been identified as a key risk to economies and societies around the world. In 2017, the World Bank reported that the number of Philippine firms that report inadequate workforce skills rose by 30% in the past six years alone. The World Bank report¹ further states that two-thirds of Philippine employers report difficulty finding workers with an adequate work ethic or appropriate interpersonal and communications skills.

Furthermore, being a graduate of K12 or higher education does not seem to be improving job outcomes. According to the DOLE’s JobsFit 2022 Labor Market Information (LMI) Report² that was launched in 2019, most unemployed youth are either high school graduates or college graduates. As Industry 4.0 transforms business and jobs faster than workers adapt, the repercussions are greater income inequality, unemployment, and mass migration.

So, this is a problem that we have struggled with for some time now. Unfortunately, the COVID pandemic has accelerated the change that AI and automation started. According to DOLE³, some 5 to 10 million workers could lose their jobs due to the coronavirus pandemic and resulting lockdowns. For those employed, their jobs will need to be redesigned as business models change.

So how do we think about helping low-income workers adapt and reskill? First things first, they may need cash aid to survive. The priority for those who lost their income isn’t to enroll in a training course. People cannot learn when they are hungry. We need to first help them reduce their potential exposure to the virus, provide daily necessities if necessary, and then figure out how they can get re-employed and return to work. The economy will also take time to recover. As businesses struggle to reopen, this support for the most vulnerable will be needed for many months, even after quarantine is lifted.

Now for those who have these basic necessities, we can start asking, so where are the jobs? And so how can we help people get the skills for those jobs? The reality is that most businesses are badly hit, and some might not even survive without fiscal government support. Many will have to reimagine their business model on top of new consumer behavior shifts, industry shifts and new regulations such as social distancing rules. Hiring will take a back seat while companies reassess the situation. In mid-2020, at the height of the pandemic, we at BagoSphere talked to over 20 Philippine business leaders and executives. There were many companies that have declared a hiring freeze. Many are also challenged to reskill their workforce and help them adjust to working from home. We also found many leaders worried about the increasing stress that their workers are facing from the prolonged lockdown and uncertainty.

Despite these challenges, there are a few that have managed to grow in these turbulent times. We found growing job opportunities in the online jobs and IT-BPO sectors that are supported by global trends of cost-cutting measures and increasing demand for digital products and services. The good news is that many companies we talked to are seriously considering making working from home arrangements a permanent part of their operational model. This means that companies might be more open to hiring remote workers, reducing congestion in Metro Manila, and improving the quality of life for workers in the long term.

While the job market is unfavorable, we encourage the unemployed to develop skills that are in demand for the new normal. Besides, learning takes time. To use a farming analogy, we can cultivate the seeds now. However, there is a problem. Online courses on Coursera and Udemy can scale easily, but they are too focused on learning acquisition and retention. We need more learning experiences that focus on skills application and performance improvement. This requires a close partnership with employers to identify important scenarios, manager support, timely feedback, and identification of performance barriers. We have found that a combination of online learning and careful design of job training can make learning more impactful.

What kind of skills should we be focusing on? Early this year, Linkedin launched the 2020 Emerging Jobs Report for the Philippines which ranked roles like Customer Success Specialist, Sales Development Representative, and Data Engineer. The common denominator among these jobs is that they require people to be digitally savvy (e.g. understanding SEO, HTML, data analytics, visualization) but also require human skills (e.g. problem solving, teamwork, communication, learning mindset). Even in traditional jobs that most young Filipinos are familiar with (e.g. retail, education, and food & beverage), a worker’s level of human skills is a key differentiator in job performance.

With technology moving so fast, two-thirds of today’s five-year-olds may, in about 15 years, find themselves in jobs that don’t exist today. Therefore, we believe it’s better to focus on the human skills that can be applied in all types of jobs. Jack Ma famously called this the “Love Quotient” a spin on IQ and EQ. Based on our experience training a few thousand unemployed youth, human skills is the biggest factor in helping people adapt and re-skill. These are uniquely human skills that cannot be done by machines. We believe that human skills are the underrated skills of the future. Read more about these skills in the next article!

About the Author

Zhihan Lee is the co-founder and Group CEO of BagoSphere, a Philippine-based education company that works with employers to develop workforce training programs, and then trains promising job seekers to fill in-demand jobs. Zhihan worked at a medical-tech start-up in Stockholm before venturing into rural India to work with a social enterprise involved in rural IT outsourcing. Graduating from the National University of Singapore’s Engineering Science Program, he studied entrepreneurship at the Stockholm School of Entrepreneurship & The Royal Institute of Technology. For his work at BagoSphere, he was named as a Global Good Fund Fellow in 2016 and an Ashoka Fellow in 2018.

References

1 https://www.worldbank.org/en/country/philippines/publication/developing-socioemotional-skills-for-the-philippines-labor-market

2 https://www.philstar.com/headlines/2019/01/02/1881616/dole-most-unemployed-are-educated

3 https://news.abs-cbn.com/business/05/21/20/10-million-jobless-in-philippines-due-to-covid-19-crisis-is-possible-says-labor-chief

Featuring impact stories from the Philippine community of Ashoka, the world’s largest network of social innovators.

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