Beijing:Artificial intelligence (AI) and economic pressures are significantly impacting Asia's labor market, with companies across the region restructuring operations, cutting jobs, and rethinking entry-level hiring, especially in the technology sector.
According to Anadolu Agency – English, nearly 80 million workers in Southeast Asia hold jobs that could potentially be influenced by generative AI, as reported by the International Labor Organization (ILO). However, the effects of AI are uneven across the region. While some companies are reducing staff or reconsidering graduate recruitment, others are altering existing roles rather than eliminating them entirely.
China's major tech firms, such as Alibaba and Baidu, are undergoing restructuring as they invest in AI and cloud computing. Alibaba's workforce reportedly decreased by roughly one-third in 2025 due to the sale of retail businesses, and Baidu ended the year with nearly 7% fewer employees. In response to these changes, the Chinese government has introduced an 18-point plan to manage AI's impact on employment.
In Japan, more than half of surveyed firms expect their workforce to shrink over the next decade due to AI's increasing role in office tasks. South Korea is experiencing a decline in youth employment, with significant job losses in sectors heavily exposed to AI. Employment among people aged 15-29 decreased by 285,000 from June 2022 to June 2026, According to Bank of Korea.
India's outsourcing industry is also adjusting, with major IT firms like Tata Consultancy Services reducing their workforce by over 23,000 employees as business models evolve to prioritize AI. Despite these reductions, companies continue to hire for new roles associated with AI.
Singapore's sectors are restructuring due to AI, though only a small percentage of firms reported layoffs directly due to AI adoption. Most companies are redesigning roles, and 71.5% have yet to adopt AI. GovTech, a provider of technology services to government agencies, laid off workers due to factors beyond AI.
In Taiwan, AI investment boosts the semiconductor industry, though some traditional manufacturers are reducing their workforce. Meanwhile, Thailand faces challenges from technological change and manufacturing weakness, with 8.7 million jobs vulnerable to AI disruption. The Bank of Thailand reports weakened manufacturing employment, with businesses in auto parts and textiles halting operations temporarily.
Malaysia's unemployment is primarily driven by business closures and downsizing rather than AI automation, with over 42,000 job losses in the year's first half, According to Human Resources Ministry.
In the Philippines, the call-center and business services industry faces exposure to technologies handling routine inquiries. While 12.7 million jobs are exposed to AI, only a small percentage face a high risk of displacement, underscoring the need for skill adaptation in the country's outsourced services sector.