KUALA LUMPUR, 17 May 2025:
How long will it be before worker replacement by artificial intelligence begins an even more accelerated ramp up in Malaysia?
Various analyses suggest that worldwide work shredding by AI will worsen the next three to five years, with Bloomberg Intelligence saying as many as 200,000 global banking jobs could disappear by 2027. The National Union of Banking Employees (NUBE) cautions that Malaysia will not be far away from the race when that happens.
“We are seeing a worrying trend where employers are leveraging the rise of AI and automation to downsize their workforce, sometimes drastically,” NUBE researcher Monisha Selvam said in a recent presentation to members of the Social Protection Contributors Advisory Association Malaysia (SPCAAM), the country’s leading labour advisory.
Monisha’s research indicates a significant transformation in the world employment market due to digitalization and AI, with an estimated 92 million jobs lost globally by 2030.
“While 170 million new roles are anticipated, the impact of automation and AI presents a complex picture. Approximately 40% of employers are considering workforce reductions due to automation,” she said.
“Although AI is projected to create 11 million jobs, it is also expected to displace 9 million others, while automation alone could lead to a net loss of 4.8 million jobs.”
Machine or human?
Monisha spoke, particularly, of the use of automation as a pretext for arbitrary headcount reductions that prioritized cost-cutting over worker welfare.
“This is not always a necessary consequence of technological advancement but can be an opportunistic move that exacerbates job insecurity,” she said. “Machine or human, which is more important?”
Global reports increasingly suggest that companies investing heavily in AI are simultaneously laying off significant numbers of employees, citing efficiency and strategic pivots towards technology as justification.
Monisha cites the “The Future of Work” report by the International Labour Organisation, which says that while digital transformation will not eliminate all jobs, it will fundamentally alter the skills and roles required.
“The future of work should be about collaboration between humans and machines, not a competition where one replaces the other,” she said. “We must prepare our society to not just use technology, but to create it, and to ensure that the benefits of digitalization are shared equitably, without leaving workers behind.”
Cyber-RT’s own research shows adoption of machines in Malaysia’s financial sector is ever growing, with institutions exploring and adopting by the day AI-powered solutions.
While AI creates positive effects such as enhanced customer service, improved risk management, increased efficiency and personalized services through chatbots, its impact has thus far been skewed towards human redundancy.
Profound shift needed for human workers to survive
A 2024 report from the Department of Statistics Malaysia warns that approximately 600,000 jobs in the clerical, administrative, and manufacturing sectors could be replaced by AI in the next three to five years.
To mitigate a potential employment crisis for its members, NUBE has consistently demanded that banks in Malaysia work with the union in coming up appropriate reskilling and upskilling programs to enable workers to transition accordingly with moving technologies.
Banks have instead come up with e-learning modules that NUBE rejects as ineffective and perilous to the job security of its members who are likely to be unfairly penalized for faults they are not properly trained to avoid.
The Bloomberg report says the global job losses in banking are expected to be concentrated in back-office, middle-office and customer service functions, involving repetitive tasks.
Monisha said using the logic that machines can only do as programmed by humans, AI’s advancement can be mutually beneficial when the real workforce is upskilled to remain in a commanding position over the technology.
“Automation is not about mass job losses, but a profound shift in what our jobs will entail,” she said. “Workers need to be equipped with the skills of the future, and there must be safety nets for those whose roles are most impacted by these changes.”
In Malaysia, Monisha stresses on the importance of a collaborative approach involving the government, employers, educational institutions, and trade unions to navigate the evolving work landscape.
She points to the need to recalibrate appropriate government policies and training programs, such as the 12th Malaysia Plan (RMK12) and the Industry4WRD, which recognize digital transformation as a central pillar of economic development.
Other initiatives that could be amped up include retraining programs like PENJANA and HRD Corp and the multiple Technical and Vocational Education and Training schools that prepare the workforce for the demands of the new economy, she said.