Hello and good morning po.

The particular area my team has been working on is focused on the

socio-economic implications of artificial intelligence (ai) and automation of works in the Philippine
service sector. But before I begin, I would like to point out three focus areas from our research poster:
Three focus areas:
a. The Philippine Inclusive Innovation Industrial Strategy (i³S).
b. Economic impact of automation and AI
c. Country’s standing with the coming of the 4th industrial revolution.

How we could see this as an issue that would concern the accounting field is that accountancy is
in itself part of the service sector among other occupations who have contributed greater than 50% of the
country’s GDP for more a decade. Now, in order to create a balance between the service sector,
manufacturing sector and agricultural sector, the government funded the Philippine Inclusive Innovation
Industrial Strategy (i³S) in 2016 in order to meet this objective. This government policy allowed for a
joint competition between the said sectors, thereby promoting distributed employment within each sector
to fully maximize the economic productivity of the country.

What seemed problematic is that in 2020, the Asian Development Bank Institute reported that a
shift in automation had resulted to a net positive employment impact that was only evident in the
manufacturing sector, whereas service forms of occupations had an overall net job loss in the country as
many businesses adapted to either partial or full automation in 2020, which is the year when the pandemic
had begun to change the country’s economic climate. Now, automation and AI have been observed as
more efficient in performing complex tasks in the industrial sector, providing cheaper alternatives for
investments while maximizing economic productivity. But what’s alarming is the tendency for most firms
to choose this form of investment rather than relying on human capital considering the fact that
machineries have proven to outperform what humans can do in certain areas.

And with the pandemic causing the country to go under a recession, almost every industry has
been looking for ways to keep their businesses alive at all costs. As 57.10% of Filipino employees reside
within the populous service sector, more than half of employed Filipinos may lose their jobs if the
government is not prepared to create a balance between machinery and human capital.

Moving over to the implications of the study, Oxford Economics in 2018 wrote that as
productivity increases through AI, a decline in traditional occupations shall occur by 2028 in ASEAN
countries. Now, what is concerning is that although it is studied that automation and AI have the potential

作成した/終わった: 03-06-2021
Alcera, Vincent Luigil C.
to both replace existing repetitive jobs while at the same time create new jobs, the Philippines may not be
ready to cover for unprepared/unexpected shifts from traditional labor while the government fully invests
in technological change rather than an equilibrium between human labor and machinery. I mean, this
unpreparedness can already be observed with how the government handled the pandemic incompetently.
Despite the fact that the head accountant of Gusto Software Company doubted AI’s capability of
replacing certain occupations like accounting due to its capability to only generate recommendations
based on broad generalizations, Harvard Business Review in 2018 argues that three categories of AI are
being developed to function similarly to the cognitive function of simple individuals.

We know that investing in automated technologies would result to higher economic productivity,
which would lead to a tendency for firms to prefer this type of set-up rather than depending on human
labor alone as seen in Asian Development Bank’s findings in 2020. That is why my team suggested that a
policy must be set in order to identify new skills and jobs if the country is to compete among its
developed and developing neighbors. would result to complications with regards to subsidies in order to
cover for potential surges in the country’s unemployment. Relying on developed countries to cover for
this would not benefit the Philippines considering our ten (10) trillion-peso debt incurred in 2020. I mean,
we’ve already read Birdsall’s perspective on international trade.
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(The improvements in automation and artificial intelligence through research on human and software
linkage is only but inevitable. If no effort is done to balance the change between AI and employment, the
government’s effort in investing on the i³S would risk workers under a populous sector of the Philippines
in years to come.

With the Philippines being ranked 50 th among 131 economies according to the Global Innovation Index in
2020 while ranking 109th in New Businesses category and 124 th in the Ease of starting a Business
category, there may be no excuse to doubt our readiness to the coming of the 4th industrial revolution,
will may only result to economic setbacks.)

作成した/終わった: 03-06-2021
Alcera, Vincent Luigil C.