ASEAN Economic Community: Which professions can move freely?

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ASEAN workerExpectations are high among workers living in one of the ten countries of the Association of Southeast Asian Nations, or ASEAN. With the advent of the ASEAN Economic Community (AEC), planned to come into effect by the end of 2015, ASEAN countries are supposed to open their labour markets for each other – albeit only to a certain extent.

Unlike the model of the European Union, which is based on the absolutely free movement of people regardless of their educational or professional background, labour movement within ASEAN will be, at least at the beginning, confined to eight professions only, which are doctors, dentists, nurses, engineers, architects, accountants, surveyors and tourism industry professionals.

While the goal of ASEAN’s economic integration is to become a single production base where goods can be manufactured anywhere and distributed efficiently to anywhere within the region, in reality, integration and the free flow of resources and labour will only be implemented gradually, step by step and sector by sector.

This is also to avoid brain drain effects for countries investing in people such as doctors or engineers who later on move somewhere else, namely from a poorer to a richer country, leaving their country of origin behind with a deteriorating healthcare system and fewer technical specialists.

With what the ASEAN Secretariat calls “managed flow of talent”, the AEC will, according to specific industrial strengths of each ASEAN nation, lead to a “natural selection process”. It is expected that the electronics industry will go to Malaysia; banking, finance and logistics to Singapore; automotive and food processing to Thailand; extracting natural resources to Indonesia; business and IT outsourcing services to the Philippines; and consumer goods manufacturing to Vietnam.

Myanmar, Laos and Cambodia will largely remain the source of unskilled or semi-skilled labour until their economic growth allows for more comprehensive education of their people.

However, even countries with a well-educated workforce will have to see that they remain competitive and need to constantly train and improve labour skills, most of all in the above mentioned eight preferred professions. For some countries, particularly Thailand, improvement of foreign language skills is also of utmost importance.

The graphic below shows the skill levels of the emigrating population of each ASEAN country, whereby the Philippines stands out while Myanmar and Indonesia are contributing most of the lower-educated labour migrants.

ASEAN Migrants and education

 

Another graphic shows labour migration corridors in ASEAN. Most of the migration takes place from Myanmar, Cambodia and Laos to Thailand, from Indonesia to Malaysia and Malaysia to Singapore. The table is a good indicator of what would happen in ASEAN when all restrictions on movement of labour and people would be removed.

Intra-ASEAN migration1

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Reading Time: 3 minutes

Expectations are high among workers living in one of the ten countries of the Association of Southeast Asian Nations, or ASEAN. With the advent of the ASEAN Economic Community (AEC), planned to come into effect by the end of 2015, ASEAN countries are supposed to open their labour markets for each other – albeit only to a certain extent.

Reading Time: 3 minutes

ASEAN workerExpectations are high among workers living in one of the ten countries of the Association of Southeast Asian Nations, or ASEAN. With the advent of the ASEAN Economic Community (AEC), planned to come into effect by the end of 2015, ASEAN countries are supposed to open their labour markets for each other – albeit only to a certain extent.

Unlike the model of the European Union, which is based on the absolutely free movement of people regardless of their educational or professional background, labour movement within ASEAN will be, at least at the beginning, confined to eight professions only, which are doctors, dentists, nurses, engineers, architects, accountants, surveyors and tourism industry professionals.

While the goal of ASEAN’s economic integration is to become a single production base where goods can be manufactured anywhere and distributed efficiently to anywhere within the region, in reality, integration and the free flow of resources and labour will only be implemented gradually, step by step and sector by sector.

This is also to avoid brain drain effects for countries investing in people such as doctors or engineers who later on move somewhere else, namely from a poorer to a richer country, leaving their country of origin behind with a deteriorating healthcare system and fewer technical specialists.

With what the ASEAN Secretariat calls “managed flow of talent”, the AEC will, according to specific industrial strengths of each ASEAN nation, lead to a “natural selection process”. It is expected that the electronics industry will go to Malaysia; banking, finance and logistics to Singapore; automotive and food processing to Thailand; extracting natural resources to Indonesia; business and IT outsourcing services to the Philippines; and consumer goods manufacturing to Vietnam.

Myanmar, Laos and Cambodia will largely remain the source of unskilled or semi-skilled labour until their economic growth allows for more comprehensive education of their people.

However, even countries with a well-educated workforce will have to see that they remain competitive and need to constantly train and improve labour skills, most of all in the above mentioned eight preferred professions. For some countries, particularly Thailand, improvement of foreign language skills is also of utmost importance.

The graphic below shows the skill levels of the emigrating population of each ASEAN country, whereby the Philippines stands out while Myanmar and Indonesia are contributing most of the lower-educated labour migrants.

ASEAN Migrants and education

 

Another graphic shows labour migration corridors in ASEAN. Most of the migration takes place from Myanmar, Cambodia and Laos to Thailand, from Indonesia to Malaysia and Malaysia to Singapore. The table is a good indicator of what would happen in ASEAN when all restrictions on movement of labour and people would be removed.

Intra-ASEAN migration1

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