Employment issue tops the list

Azlan Othman

Unemployment and underemployment are top concerns for business leaders in 2020, according to the World Economic Forum’s (WEF) ‘Regional Risks for Doing Business Interactive Map’.

Infectious disease risk has leapt 28 places to reach the list’s top 10, overriding worries about a failure in critical infrastructure.

According to the survey, environmental concerns are also being given greater prominence, moving up the annual Regional Risks for Doing Business Interactive Map ’ rankings significantly.

In the uncertain world COVID-19 has created, unemployment and underemployment top CEOs’ worries for doing business around the world. Concerns about infectious diseases have, unsurprisingly, also joined the list of things keeping them awake at night.

The report, which surveyed over 12,000 business leaders from 128 countries, found that unemployment was seen as the most pressing problem companies might face in 2020. It is a perennial risk for businesses, but had fallen into third place behind fiscal crises and cyberattacks in 2019.

Conducted between January and July 2020, the survey asked leaders to select which five risks from a list of 30 are the most concerning for doing business in their country in the next 10 years.

No reports were available for Brunei Darussalam in this 2020 edition. But last year, unemployment or underemployment posed the biggest management concern for Brunei entrepreneurs. It was followed by energy price shock as ranking second, cyberattacks in third, data fraud theft in fourth and misuse of technology in fifth.

In last year’s report, Brunei was the only country in East Asia and the Pacific region along with Korea that chose unemployment as the biggest risk for doing business.

In the 2020 report, although in general, East Asia and the Pacific ranked infectious diseases as their main concern, each country across the region has also recognised other worries when it comes to doing business.

In ASEAN member states Cambodia and Thailand, 32 per cent and 44 per cent of respondents perceived asset bubble as their top risk in business, whereas Indonesia (52 per cent), Malaysia (45 per cent) and Vietnam (65 per cent), selected the spread of infectious diseases as their main concern.

Around 41 per cent of respondents from Lao PDR said deflation was their greatest worry, while, understandingly – 55 per cent of surveyed Philippine business leaders ranked natural catastrophes as their top perceived business risk.

Most of the top risks identified were related to economics, but climate change-related risks are creeping up the board agenda. Although no environmental risks make the top 10 globally, the perceived risk of natural catastrophes has climbed seven spaces and extreme weather events is up five places. Biodiversity loss and ecosystem collapse has risen by eight places and failure to adapt to climate change is up two places.

Nine of the top 10 risks from 2019 are in the top rankings again in 2020, with a failure in critical infrastructure falling out of the ranking as infectious diseases gain in importance.

The research is part of the WEF’s Global Risks Initiative which analyses critical global risks and communicates them to stakeholders and the wider public.

The data is released ahead of the WEF’s inaugural Jobs Reset Summit which aimed to shape inclusive, fair and sustainable economies, societies and workplaces.

The interactive map has been developed in partnership with Marsh & McLennan Companies, Zurich Insurance Group, and SK Group.

“The employment disruptions caused by the pandemic, rising automation and the transition to greener economies are fundamentally changing labour markets,” said WEF Managing Director Saadia Zahidi. “As we emerge from the crisis, leaders have a remarkable opportunity to create new jobs, support living wages, and reimagine social safety nets to adequately meet the challenges in the labour markets of tomorrow.”

Meanwhile, SK Group Social Value Committee President Lee Hyung-hee said, “The global pandemic has unleashed untold damage to our economies and societies. Business leaders in Asia have recognised that risk in their response to the Forum’s survey, with infectious diseases appearing as the number one risk for the region. As new partners to the initiative, we are working to better understand the interconnections between the risks perceptions of business leaders and their broader multi-stakeholder community.”

“What we already know is that tackling the intersecting risks of pandemic, financial risks, and climate change will be a cornerstone of the desired new normal,” added Lee.