Millennials face savings crunch amid tech upheaval
MILLENNIALS face the prospect of getting stuck in low-paying jobs that leave them with inadequate savings for retirement as victims of technological disruption in the economy, Krungthai Macro Research warns.
Automation and technology in the 4.0 era would not lead to high unemployment, but many of the jobs available to today’s young workers would be low-paid and reduce their ability to save, said Phacharaphot Nuntramas, senior vice president of global business development and strategy group at Krung ThaI Bank.
Around the world, millennials – those aged from 21 to 38 – have almost the same rate of preference for routine jobs as that shown by the older workers: the baby boomers and Generation X. In Thailand, millennials represent the largest proportion of the population – at around 28 per cent – and with decades of work ahead of them.
Automation could replace routine cognitive jobs such as cashiers and brokers, and routine manual job such as those at assembly plants or involving the operation of machines.
Krungthai Macro Research expects that many professional jobs - such as managers, medical doctors, engineers, teachers and lawyers - would be unlikely to be replaced by automation or artificial intelligence (AI). Similarly, those in non-routine manual roles such as care givers, security guards and some services job would not be much affected by Industry 4.0.
The new technology could make incomes of routine jobs drop by about 50 per cent. For example, if a typical 30-year old office worker has a monthly salary of Bt30,000, and without technological disruption, his income would grow to Bt90,985 when he reaches 59 years of age. However, with technological disruption, his income growth would be flat, at about Bt 46,199.
Turning to SMEs
Some millennials may opt to resign from those big corporations that could adopt automation or other technology quickly and instead find jobs in small and medium-sized enterprises (SMEs). Such smaller companies may be slower to adopt new technology. But this alternative career path would not work out financially, given SMEs usually pay about 14 per cent less than the wages at big companies.
The researcher suggested that millennials may quit job in order to continue their study for about two years by choosing new fields that are high demand In the market, these jobs related to creative jobs or busIness management.
