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Skilled workers in increasing demand despite ASEAN job market getting tough

Feelings of insecurity

The global recession and the rising oil crisis have both contributed to growing unemployment in the region. A Financial Times report from January this year revealed that in five of the region’s biggest economies, more than half of candidates found it hard to find new jobs.

The most pessimistic outlook recorded was in Malaysia, where two-thirds of workers described the job market as tough. The sense of insecurity is fuelled by major lay-offs, most recently by Petronas (1,000) but also by CIMB last year (4,000) and prior to that, Malaysia Airlines (6,000), following the tragic loss of two aircrafts in 2014.

However, as Malaysia’s growth rates are still doing well compared to other countries in the sector, talent acquisition is a major problem. Professionals specialising in IT and financial services are among those with the luxury of having the most choices for jobs. As many architectural projects have been finalised, the building sector is lowering headcount but facilities managers and similar are likely to be in demand.

Malaysia’s corporate culture is also rapidly maturing, and there will be a greater need for mid-level managers to close the gap between directors and junior staff.

Singapore’s employees are more likely to change their jobs in search for non-financial perks than Malaysians. As the most mature economy in the region, Singapore maintains low salary inflation, and boasts the highest employee retention figures.

However, a recent pre-Budget REACH survey revealed that Singaporeans fear for their jobs in the midst of the slowing economy. In light of these concerns, Finance Minister Heng Swee Keat’s Budget 2016 speech came as a relief – SMEs will receive help to secure loans, as will struggling sectors of marine and processing industries.

A salary hike in Singapore has been further curbed by the consistently low exchange rates for the Chinese yuan. Candidates with digital skills, strong regional experience and good English are still in high demand, as are those specialising in finances and professional services.

Singaporean companies are relatively open to employing foreigners, but they are likely to miss out on both domestic and overseas talent, as candidates are attracted to the quick growth of salaries in developing countries.

Globalising currents

When it comes to growth, Myanmar tops the list of ASEAN countries in 2016. But even with its recently sworn government and the inauguration of the first stock exchange, the road to prosperity is still long. In the capital Naypyidaw, the opportunities for skilled workers are abundant but the situation of migrants from the villages is desperate.

With one of the lowest GDP per capita in the region, Myanmar is not a serious contender for tempting foreign talent to its shores, but many expatriates are likely to come back and bring their professional expertise to the newly democratising country.

Larger economies in the sector, especially those continuously noting high levels of growth, still offer attractive opportunities for Western workforce. While in East Asia – and in Singapore – more and more nationals are returning home with American and European MBAs and foreign expertise, the pool of overseas-educated candidates remains small in Indonesia, Thailand and the Philippines. Regional experience and languages are increasingly valued as ASEAN economic integration moves forward, but the allure of Western candidates remains strong.

The recently established Trans-Pacific Partnership (TPP) is also expected to affect the job market in the region. Geared toward greater US inclusivity, it is a free market agreement signed by 12 Pacific Rim countries, four of which are ASEAN members, with an additional four members expressing an interest in joining at a later stage.

The exclusion of the Middle Kingdom in the agreement is aimed at reducing the impact of the Chinese economy in Asia, but Beijing has also expressed interest in joining the pact.

It is estimated that the TTP will add $223 billion of annual income to workers in all countries, with a third of this sum going to the US. Unfortunately, it is those earning over $88,000 a year who will benefit the most. While it will create growth opportunities for corporate organisations, the TTP is likely to worsen the situation of unskilled workforce across the signatory countries, especially in Asia.

Skills instability

Dubbed the Fourth Industrial Revolution, the unprecedented advance of technology is expected to lead both to major job losses in emerging markets but also to leveling the standard of living. Rapid changes in the demand of skills are adding to the market instability caused by the sluggish economy.

While at this stage speculation on the full effects of the forecasted digital and robotics revolution are still largely in the realm of futurism, here are some hard facts regarding the ASEAN skills shift.

While English becomes a staple for skilled workers, a second regional language is increasingly in demand across various specialisms. The willingness to relocate is also a big factor, as companies in maturing economies seek to establish branches in more cost effective countries in the region.

Across ASEAN, the gas and oil, as well as the construction industries, are likely to further reduce headcount in the coming months. Interesting engineering and manufacturing opportunities will arise in Indonesia and other countries with quickly developing infrastructure. Healthcare and related sectors are growing in countries with aging societies, where a burgeoning middle class is coming into age, particularly Singapore and, recently, Indonesia.

In Malaysia, manufacturing and logistics sectors are expected to increase their workforce while secretarial support is also, as always, in high demand across the region. Professional services and marketing sectors are also on the rise.

Even though the ASEAN job markets are becoming more and more competitive, the region continues to offer interesting opportunities for both domestic and foreign skilled workers willing to test themselves in a dynamically changing environment.