Automation and its impact on employment in the apparel sector of South Asia

Abstract

South Asia has become world´s one of the emerging markets for apparel because of their cheap labor and raw materials. Therefore, South Asia is one of the potential global apparel manufacturing and exporting centers. Since the apparel industry is highly labor-intensive, this industry provides millions of job opportunities for people who live in countries such as India, Bangladesh, Pakistan, and Sri Lanka. The recent innovations in the apparel industry, such as automating production processes, sewbots, and introducing new machines, have increased the risk of technology-induced job displacement in this region. Therefore, this paper aims to evaluate the threat of automation to employment, focusing on the South Asian apparel industry.

This study uses a qualitative approach complemented by secondary qualitative data. Based on the economic theories and secondary data, this research finds that automation technology in the apparel industry has not led to the significant displacement of jobs in this region. However, the employees who obtained low–skilled employment, such as cutting and sewing machine operating, risk losing their jobs in the industry. The employees who perform jobs that require cognitive skills, such as managerial jobs and executive jobs, are difficult to substitute with technology.

Moreover, technology in this industry is complementary to increasing labor productivity, and it supports increasing the demand for apparel products and improving exporting opportunities. At the same time, it also enables the creation of new job opportunities in this sector by expanding, demanding products, and exporting them. However, the lack of economic feasibility to invest in implementing technology in the industry makes this region quite far behind the other developed countries globally.