The Malaysian government’s announcement of 5.1% growth for last year is testament to the country’s economic resilience, outpacing the initial forecast of 4% to 5% set in the previous year’s budget.
The robust performance, achieved amid global uncertainty, can be attributed to a combination of improved trade conditions and a surge in foreign investment inflows.
Such economic indicators are promising signs of Malaysia’s potential for sustained growth and prosperity.
A recent white paper by the World Economic Forum (WEF) underscores the importance of expanding labour and capital inputs for organisations aiming to secure long-term growth.
The report particularly highlights the role of technology, and artificial intelligence (AI) in particular, as a significant driver of productivity.
According to the WEF, AI could potentially enhance productivity in emerging economies by as much as 4.5% over the next decade.
Despite these optimistic projections, the EY AI Pulse Survey reveals a gap in AI adoption among businesses.
Just 36% of business leaders report that their organisations have prioritised the development of data infrastructure, which includes quality, accessibility and governance.
This is a shortfall, especially considering that 88% of businesses have increased their budget allocations to support such advancements.
The transformative impact of AI on global work practices is undeniable, and Malaysia is keen to be part of this technological revolution.
However, the journey is not without its challenges.
Like many other nations, Malaysia is grappling with issues related to AI adoption such as governance, preparedness and talent shortages.
Implications for the workforce
These challenges must be addressed to fully harness the benefits of AI for the nation’s economy.
The future of Malaysia’s human capital is poised for significant change, driven by the integration of AI, digitalisation and sustainability.
Research conducted by TalentCorp titled Impact Study of AI, Digital, and Green Economy on the Malaysian Workforce, which canvassed the opinions of stakeholders across 10 key Malaysian sectors, indicates that 18% of employees are highly impacted by these technological shifts.
The WEF further projects that 39% of the global workforce will experience a disruption in skillsets by 2030.
Both studies concur that while AI will drive demand for new skills, it may also render some roles redundant, particularly in certain sectors.
Malaysia’s workforce is notably young, with nearly 40% below the age of 30.
This demographic is perceived as highly adaptable and poised to realign with evolving organisational talent strategies.
Nonetheless, there are concerns about existing skill gaps, especially in areas of digital fluency, which is identified as one of the top five skills in demand according to the Free Software Foundation.
As we look to the future, it is clear that boards must play a crucial role in addressing the needs and influences of Gen Z – the demographic that will soon dominate the consumer market and the workforce.
It is imperative for board members to consider and implement strategies that will steer their organisations towards a future that is shaped by the preferences and values of this upcoming generation.
The EY Gen Z AI Literacy report sheds light on the optimistic view that Gen Z holds towards AI and their ability to identify the transversal and technical skills required to thrive alongside AI technologies.
Gen Z’s influence on the future
However, despite their inherent digital nativity and openness to AI, there is a noticeable inconsistency in their AI literacy levels.
This disparity could have significant implications for businesses if practical proficiency is mistaken for comprehensive AI literacy.
To address this, organisations must commit to equipping this emerging workforce with the knowledge and skills necessary to fully realise AI’s potential.
This effort may entail embracing unconventional forms of education that resonate with Gen Z, such as learning through social-media platforms – a method preferred by 55% of Gen Z, according to survey responses.
The agility of Malaysia’s future workforce is crucial, and readiness to adapt to new technologies and methodologies is non-negotiable.
A concerted effort is required to bridge readiness gaps, which will involve developing AI consensus frameworks, enhancing upskilling efforts, and considering the implications for individual career trajectories as part of an organisation’s AI transition agenda.
Considering the Impact Study of AI, Digital, and Green Economy on the Malaysian Workforce, boards must take a proactive stance to ensure their companies remain competitive in driving productivity growth and are not sidelined during the digital transformation. This involves:
> Championing in-house training and development programmes to upskill and reskill employees in AI, digital and green-economy skills, while addressing the holistic growth of the workforce.
> Implementing talent retention strategies that include creating personalised career development plans and fostering talent mobility to broaden skill sets and prepare employees for future roles.
> Fostering collaboration to build stronger synergy with government bodies, academic institutions and training providers to ensure that effective solutions are implemented efficiently and in a timely manner.
Initiatives like TalentCorp’s MyMAHIR Future Skills Talent Council exemplify this endeavour and encourage such collaborations to equip Malaysian talent with in-demand skills.
In conclusion, Malaysia’s economic growth highlights the critical need for strategic AI integration within workforce development to bridge existing skill gaps and leverage the adaptability of its youthful population.
Boards must prioritise comprehensive in-house training, robust talent retention, and collaborative skill-building initiatives to ensure the nation’s sustained success in the digital era. By doing so, Malaysia can look forward to a future where its workforce is not only prepared for the challenges of tomorrow but is also actively shaping the digital landscape.
Anil Shivadas and Low Choy Huat are partners at Ernst & Young Consulting Sdn Bhd. The views expressed here are the writers’ own.
