The establishment of the ASEAN Economic Community (AEC), a major milestone in economic integration offering opportunities to more than 622 million people in this region, would impact talent competition in the region.

“Singapore’s attractiveness as a talent hub has in recent years faced strong competition from its neighbouring countries, and that is likely to intensify when talent is completely mobile in this region (ASEAN),” says Wong Su-Yen, Chief Executive Officer, Human Capital Leadership Institute (HCLI).

Singapore has shown exemplary performance, being consistently ranked top of this region; however, the report found that the city state has room for improvement in terms of tolerance to migrants, empowerment of employees, and increasing the pool of vocationally trained people.

Wong adds: “The country, which has seen a 33% increase in the number of its citizens working and living abroad, signals that policymakers can increase efforts to attract them back, as this group of talent would offer a distinct and important combination of overseas work experience and strong local knowledge.

Global Talent Competitiveness Index

Singapore retains its top spot in Asia Pacific for the third consecutive year in the Global Talent Competitiveness Index (GTCI) 2015-16.

The top three countries in Asia Pacific have all demonstrated openness in their economiWes to attracting talents: Singapore has close to 43 percent of its population born abroad, New Zealand and Australia approximately 17 percent.

Ilian Mihov, Dean of INSEAD, commented: “This year’s theme of international mobility and talent attraction is of high relevance to Asia Pacific. Asian countries are historically seen as talent exporters; however, this year’s report highlights the increasing trend of talent relocating to this part of the world, including a key finding that jobs are moving to where talent is, such as China, South Korea, Philippines and Vietnam.”

China and India: Gaps in vocational skills

Bruno Lanvin, Executive Director of Global Indices at INSEAD and co-editor of the report, notes that gaps in vocational skills continue to exist in emerging countries such as China and India.

China is expected to face a labour shortfall of approximately 24.5 million. The country’s state-owned enterprise sector has experienced difficulties in appealing to Chinese educated abroad.

“[China] could fare better in luring back former emigrants by increasing the professionalism of business culture and management practices as well as paying more attention to employee development,” says Lanvin.

He further added: “In India, one of its biggest challenges lies in talent attraction; that, combined with the lack of international students, puts the country at risk of brain drain despite its connection with the diasporas working in the IT sector.”

South Korea: Weak vocational education system

South Korea (37), despite being ranked highly in dimensions such as tertiary education enrolment and the market landscape, moved down eight places from last year due to the key challenge of attracting talents (61st) as well as skill gaps stemming from the weakness of its vocational education system.

Japan (19), on the other hand, shows good overall performance, but with its average citizen aged 53 by 2050, it can also further improve on attracting talents (45th) for future sustainability.

Malaysia, moving up five spots, has firmly secured its position as the second most attractive country for talent in ASEAN.

Paul Evans, The Shell Chair Professor of Human Resources and Organizational Development, Emeritus, at INSEAD, and Academic Director and co-editor of the GTI, noted: “Data suggest that as of 2013, there are approximately 4 million foreign workers in Malaysia, with an uptrend of skilled workers from Cambodia, Thailand, Vietnam, and the Philippines. This can be attributed to the rapid urbanisation of Malaysia which led to an increased quality of life and job opportunities.”

However, he added a warning: “On the other hand, pro-bumiputra policies are sending a large number of highly skilled and educated non-bumiputra to seek greener pastures elsewhere, leading to an accelerating brain drain from Malaysia despite the country being ranked as the second most attractive ASEAN place for talent.

Malaysia’s long-term attractiveness as a talent hub is also currently put to the test as the country weathers through its biggest political crisis since independence.

The top three countries ranked on talent competitiveness remain the same in GTCI 2015-16 as they were in 2014, with Switzerland at number one, followed by Singapore and Luxembourg in second and third places, respectively. By CFO Innovation Asia Staff, January 26, 2016

Source: http://www.cfoinnovation.com/story/10915/asean-economic-community-further-impact-talent-competition-region