Southeast Asia Struggles to Integrate Migrant Labor

ASEAN Aims for Skilled Worker Mobility Amidst Persistent Challenges

Southeast Asia grapples with integrating its labor market, even as the majority of migrant workers fill low-skilled jobs. Disparities in labor standards and uncoordinated systems impede the creation of a unified regional labor market. This is further complicated by the ongoing focus on skilled labor, which contrasts with the reality that most migrant jobs are in low-skill sectors.

Migration Patterns and Hubs

Southeast Asia’s economic conditions fuel cross-border labor migration, driven by income differences and employment opportunities. Wealthier nations such as Singapore and Brunei have become established as major labor-receiving countries. Meanwhile, nations like Indonesia are primarily sources of migrants.

The data reveals distinct regional hubs for migrant labor. Specifically, Malaysia, Thailand, and Singapore are the primary destinations. These countries rely heavily on foreign workers, especially in sectors like manufacturing and construction.

Women form a minority among migrants in most countries, except in Singapore. Brunei, Malaysia, and Thailand have the largest ASEAN worker populations.

Challenges and Policies

Policy and structural factors influence cross-border movement and worker well-being. Singapore’s effective administration and city-state compactness facilitate regulatory compliance. However, irregular migration, human trafficking, and labor exploitation continue in Malaysia and Thailand.

“…the labour brokerage model stands out as the common feature across the Southeast Asian region.” Such operations allow intermediaries to source foreign workers, and with their leverage and profit motive, to extract high fees and subject workers to debt bondage and forced labour conditions.

—Author, Study

ASEAN’s approach focuses on skilled labor mobility. The ASEAN Economic Community Blueprint of 2008, prioritized skilled workers. However, this has proven difficult to achieve. The mutual recognition agreements, or MRAs, designed to streamline qualifications, have faced slow progress.

The ASEAN Qualifications Reference Framework (AQRF) aims to standardize qualifications, and it could promote mobility for skilled workers. A 2023 report by the International Labour Organization indicates that the construction sector in Thailand employs a significant number of migrant workers; a majority of which are low-skilled (ILO, 2023).

Future Outlook

Despite challenges, geographic proximity and ASEAN diplomatic efforts offer advantages for intra-regional migration. The diversity of origin countries for migrant labor in Singapore and Malaysia will likely persist. More transparency regarding data from Malaysia, Thailand, and Singapore is needed to improve regional coordination.

A shift away from the current labor brokerage model could constitute a major breakthrough. Regional efforts to reduce formal migration costs and mitigate undocumented flows would also be aided by data improvements. Standardisation in the region could also help avert a race-to-the-bottom scenario. Recent proposals for ASEAN to establish guidelines for eliminating forced labor would be a timely move.