Three Key Factors Impacting Human Resource Development in ASEAN

Posted by Written by Ayman Falak Medina Reading Time: 3 minutes

There are several global megatrends that are set to impact human resource development in ASEAN. Digital transformation, climate change, and green investments, and ageing societies present new challenges and opportunities for foreign investors. The trends give rise to changing skill requirements.

Digital transformation

The COVID-19 pandemic has accelerated digital transformation in ASEAN. Disruptive changes brought about by digitalization and automation are pushing ASEAN members to move from being a relatively labor-intensive and low value-added base to higher-value manufacturing production that fosters the development of high-tech sectors.

Moreover, the disruptions are expected to relegate many jobs to automation, resulting in some occupations becoming obsolete.

The latest wave of technological advances in areas such as robotics, cloud computing, the internet of things, and artificial intelligence, among others, means there will be greater expectations for a company’s human resources.

According to a report by Bain & Company, Google, and Temasek, Southeast Asia’s digital economy will be valued at US$300 billion by 2025. The region is already home to one of the largest concentrations of tech startups and home to over 400 million internet users.

Climate change and green investments

The agriculture-based economies of most ASEAN countries are extremely vulnerable to climate change and represent one of the greatest threats to the long-term stability of the region.

According to the Center for Strategic and International Studies (CSIS), daily high tides will flood areas home to over 48 million people in the region, which will compound food and water insecurities.

There are, however, new opportunities in the ‘green economy, which can offset job losses in traditional sectors due to climate change. Many ASEAN member states have implemented policies in the area of environmental transformation and thus require talent competent to serve these ‘green jobs’.

Malaysia is looking to develop competencies in green buildings, renewable energies, and bioengineering, whereas Singapore issued the world’s first grant scheme to support green and sustainability-linked loans (GSLS) in November 2020. The Singapore scheme will assist corporations by defraying the expenses incurred from engaging with independent advisors to validate green and sustainability-linked loans.

Indonesia is developing a new and ‘green’ capital city, powered by the newest technology and low-carbon, sustainable energy sources. The new site will be four times the size of Jakarta — a megacity — set up at a cost of US$33 billion.

Thailand has also partnered with the UK to promote the development of smart cities to be constructed across Thailand. Both countries launched the UK-Thailand Smart City Handbook, established in partnership with Thailand’s Digital Economy and Promotion Agency (DEPA).

An ageing ASEAN

Although more than half of Southeast Asia is currently under the age of 30, the region has a rapidly ageing population; by 2035, ASEAN is projected to have more than 127 million people aged 65 years or older.

By 2035, Singapore will have 26 percent of its population over the age of 65 and the ageing population of Thailand is expected to reach 28.8 percent. Some 20 percent of Vietnam’s population will also be over 65 by 2038, and Malaysia will become an ageing society by 2030 when 15 percent of its population will be 60 years and above.

These demographic shifts will result in a shrinking of the Southeast Asian bloc’s working-age population. Skill development will be crucial in enhancing the capacity of a shrinking workforce and support the next stage of economic development.

Moreover, ASEAN could take lessons from the EU and promote active ageing. Under this principle, the EU invoked a higher retirement age and working activities that are adapted to the age of the employee. In turn, the region saw the share of people aged 55 years and over in total employment increase from 12 percent to 20 percent between 2004 and 2019.

About Us

ASEAN Briefing is produced by Dezan Shira & Associates. The firm assists foreign investors throughout Asia and maintains offices throughout ASEAN, including in SingaporeHanoiHo Chi Minh City, and Da Nang in Vietnam, Munich, and Esen in Germany, Boston, and Salt Lake City in the United States, Milan, Conegliano, and Udine in Italy, in addition to Jakarta, and Batam in Indonesia. We also have partner firms in Malaysia, Bangladesh, the Philippines, and Thailand as well as our practices in China and India. Please contact us at or visit our website at