There are few parts of the world where the size of the younger generation is as large as it is in ASEAN. Companies involved in the region need to be prepared for a new workplace that is dominated by managers below the age of 35. There are 289 million such individuals in ASEAN (see graphic below).
A young workforce brings with it a higher agility to move jobs. In Indonesia, 60 percent of graduates switch jobs within their initial three years of employment and more than one-third switch jobs two or more times during the same period. Human resource teams need to explore various work-life initiatives by country. It is important to determine the type of dependent care and flexible work arrangements that may have to be offered based on the country teams’ dynamics.
Companies also need to be aware of the skill-set shortfalls to create the appropriate training necessary for the individual markets. While some companies find the technical competencies of university graduates to be roughly in line with the needs of their industry, less than 50 percent of the companies across the major ASEAN countries are confident about the skill match between graduates and firms’ needs. Moreover, when it comes to non-technical competencies, very few multinational corporations are pleased with the talent pool. Though ASEAN performs better than many of the emerging markets, 75 percent of the graduates leaving university in this region are still unlikely to be employed by a multinational corporation. The key reasons cited by graduate employers are poor language skills, low quality of educational standards, limited practical skills, and poor interpersonal skills.
ASEAN’s talent market exhibits the classic signs of an emerging market suffering from an increasing demand for talent and lack of supply (see my blog on this subject here). Various studies have come to the same conclusion—the talent landscape across ASEAN can be characterized by overall scarcity; as reported by 70 percent of the respondents in a Deloitte survey. The region’s talent shortage is creating a vicious cycle that is likely to exist for the short-to-medium run. The lack of a steady talent supply and increasing demand are leading to competition for the same resources, which in turn results in challenges in attracting and retaining the right employees. The focus for most multinationals is going to be on proactively plugging the skill-set gap, developing the next generation of executives who can take up regional (not just national) leadership positions, and creating a unique employee value proposition for the enormous Gen-Y population (FSG’s clients can find the in-depth analysis on this topic here).
FSG’s Seven Crucial (Less Talked About) Facts about ASEAN
This update is Part Four of a seven-part series of quick insights that I will be publishing over the next few weeks on the ASEAN region (see full list here). These have been selected carefully based on FSG’s numerous interactions with regional executives. I will discuss the topics which have proven to have high importance for senior executives of western multinational companies and ones with a lack of coverage in the business spheres. Next week’s update: “ASEAN will become and remain one of the largest consumer of the emerging world.”