OF late, there has been a lot of talk about producing future proof graduates or future ready youths (in an economic sense). One of the major proposals is to equip our youths with enough technical knowledge to deal with Industry 4.0. This, I believe, is at best half the solution.
While it would always help to equip ourselves with some technical knowledge, however, an economy will only need a certain number of technical personnel. To ensure employability of our youths in the future, we will need to predict the development of our economy.
Statistic shows that in 2019, agriculture contributed around 7% to Malaysia’s gross domestic product (GDP), while the manufacturing industry contributed approximately 37% and the services sector about 54%.
It may be true that the agriculture and industrial sectors could have and should have contributed more to the country’s GDP. However, it is a known fact that the world economy is increasingly characterised as a service economy.
For example in Singapore, the service industry contributed 70% to its GDP and the service sector employed 84% of its workforce. Likewise, the service industry contributed 88% to Hong Kong’s GDP and employed 88% of its workforce.
Even in a big country like China, the service industry contributed around 60% to China’s economic growth in 2020. The importance and share of service sectors in the economies of most developed and developing countries are growing.
The growth of the service sector has long been considered an indicator of a country’s economic progress. The gradual switch from agricultural to industrial, and to a service dominant economy, is inevitable for Malaysia. Industry 4.0, which advocates automation, will also push many into the service sectors.
Contrary to common belief, we will need more service professionals in the Industry 4.0 economy rather than more technically-trained personnel. Anything can be done as standard operating procedures will eventually be done mechanically or by using a software.
Whereas, there are many things in which a simple human touch can add a lot of value to. What is noteworthy is that the service industry can take various forms. These can range from small businesses such as restaurants, laundries and beauty parlors, to huge and complicated industries such as airlines, banking, insurance, telecommunications and hotels.
A sign of a matured and well-developed economy is the existence of these large industries and innovative services. In between them, there is a vast range of services, such as those involving the arts and performances, care for the young and aging and logistic services – basically anything that makes us feel better.
If you understand Maslow’s hierarchy of human needs, we will understand why these will become more important as our economy develops. This will be one of the directions that the Malaysian economy will adopt naturally and be directed to, induced and propelled. It is natural because economic development will, to some extent, take its own course.
However, with the right policies, resources and support, it will happen sooner, grow faster and healthier. Although some of the “once promising” careers, such as the tourism and hospitality industries, seem somewhat discouraging now, this is a natural reaction to the economic slowdown due to the Covid-19 pandemic, which is a temporary phenomenon.
We witnessed the instant revival of these industries during the temporary lifting of movement restrictions in between the movement control orders. This is a time of survival of the fittest.
In the long run, the temporary setback actually helps (blessing in disguise) to rejuvenate the industry as good players will survive and perform better in a less clouded industry. We witnessed this in the banking and finance industries during and after the last two financial crises.
One of those things that these industries will need is well-trained human capital. This will mainly be the role of education institutions. Well-trained in two aspects: One, well-equipped with the knowledge and skills needed for the related industries. These include knowledge and understanding of the industry and how the system works.
Secondly, well-trained to be suited for the service industry. Services, in contrast with manufacturing, the quality of which depends mostly on human touch. This is beyond the kind of “soft skills” that we often hear people saying.
It is in fact more than skills – it is about values, attitudes, interests, mannerisms etc. Sometimes, these are learnt best through proper up-bringing and immersion.
My holidays in Japan is an eye-opener in this aspect. The Japanese have a polite and refined culture that makes you instantly feel welcome whether you are rich or poor.
Service professionals are professionals trained to serve professionally. They are found useful in many venues, beyond our common perception in associating them with the hospitality industry.
Just to cite a few – they will be found useful in the “after-sales services” (which will be a major competing area for many types of products); in advisory roles, such as insurance and financial services; in professional practices such as legal and accounting practices; etc.
Don’t we often relate how one professional can make us feel more comfortable than the other, although they may be equally competent technically. Therefore, service professionalism can be divided into two levels. The first level can be trained in the skills of a profession.
At a more general level, everyone, for example an engineer, can be and need to be trained to be a service professional to serve better.
As more people become qualified, this is often a major success factor. Our youths should seriously consider their future as service professionals.
Dr See Hoon Peow is CEO of Berjaya University College