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Skilled Labor Mobility and Migration Skilled Labor Mobility and Migration GENTILE_9781788116169_t.indd 1 08/07/2019 11:34 In ample seas I sail, and depths untry’d before, This let me further add, that Nature knows No steadfast station, but, or ebbs, or flows: Ever in motion; she destroys her old, And casts new figures in another mold. (Ovid, Metamorphoses, Book XV: 176–8 English translation: Ovid (1998), Metamorphoses, Wordsworth Classics of World Literature, Wordsworth Editions Ltd) GENTILE_9781788116169_t.indd 2 08/07/2019 11:34 Skilled Labor Mobility and Migration Challenges and Opportunities for the ASEAN Economic Community Edited by Elisabetta Gentile Economic Research and Regional Cooperation Department, Asian Development Bank, Philippines CO-PUBLICATION OF THE ASIAN DEVELOPMENT BANK AND EDWARD ELGAR PUBLISHING Cheltenham, UK • Northampton, MA, USA GENTILE_9781788116169_t.indd 3 08/07/2019 11:34 © Asian Development Bank 2019 Some rights reserved. Published by Edward Elgar Publishing Limited Edward Elgar Publishing, Inc. The Lypiatts William Pratt House 15 Lansdown Road 9 Dewey Court Cheltenham Northampton Glos GL50 2JA Massachusetts 01060 UK USA The views expressed in this book are those of the authors and do not necessarily reflect the views and policies of the Asian Development Bank (ADB), its Board of Governors or the governments they represent. ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequences of their use. The mention of specific companies or products of manufacturers does not imply that they are endorsed or recommended by ADB in preference to others of a similar nature that are not mentioned. By making any designation of or reference to a particular territory or geographic area, or by using the term ‘country’ in this document, ADB does not intend to make any judgments as to the legal or other status of any territory or area. This work is available under the Creative Commons Attribution 3.0 IGO license (CC BY 3.0 IGO) http://creativecommons.org/licenses/by/3.0/igo/. By using the content of this publication, you agree to be bound by the terms of said license. For attribution, translations, adaptations, and permissions, please read the provisions and terms of use at https://www. adb.org/terms-use#openaccess. This CC license does not apply to non-ADB copyright materials in this publication. If the material is attributed to another source, please contact the copyright owner or publisher of that source for permission to reproduce it. ADB cannot be held liable for any claims arising as a result of your use of the material. Notes: ADB recognizes “China” as the People’s Republic of China; “Hong Kong” as Hong Kong, China; “Korea” as the Republic of Korea; “Russia” as the Russian Federation; and “Calcutta” as Kolkata. Asian Development Bank 6 ADB Avenue, Mandaluyong City 1550 Metro Manila, Philippines Tel +63 2 632 4444 Fax +63 2 636 2444 www.adb.org This book is available electronically in the Economics subject collection DOI 10.4337/9781788116176 ISBN 978 1 78811 616 9 (cased) ISBN 978 1 78811 617 6 (eBook) Typeset by Servis Filmsetting Ltd, Stockport, Cheshire GENTILE_9781788116169_t.indd 4 08/07/2019 11:34 Contents List of contributors vii Foreword by Yasuyuki Sawada ix Preface xi List of abbreviations xiv 1 Trends and patterns in intra-ASEAN migration 1 Aiko Kikkawa and Eric B. Suan 2 Skilled migration in the literature: what we know, what we think we know, and why it matters to know the difference 25 Elisabetta Gentile 3 Economic impact of skilled labor mobility within the ASEAN Economic Community 57 Erwin Corong and Angel Aguiar 4 Implications of ASEAN economic integration on services: a global computable general equilibrium analysis 89 Kakali Mukhopadhyay 5 Employment effects of removal of restrictions on the movement of natural persons in the ASEAN banking sector 124 Huong Dinh 6 Skills mobility and postsecondary education in the ASEAN Economic Community 164 Maki Kato 7 Institutionalized costs and international migration patterns 194 Saibal Kar 8 Expanding skilled-worker mobility: comparing the migration of Indonesian careworkers to Taipei,China and Indonesian nurses and careworkers to Japan 209 Ratih Pratiwi Anwar v GENTILE_9781788116169_t.indd 5 08/07/2019 11:34 vi Skilled labor mobility and migration 9 Will ASEAN mutual recognition arrangements induce skilled workers to move? A case study of the engineering labor market in Thailand 241 Sasiwimon Warunsiri Paweenawat and Jessica Vechbanyongratana 10 Skill flows and the Fourth Industrial Revolution: future questions and directions for the ASEAN Economic Community 267 Anna Fink and Elisabetta Gentile Index 293 GENTILE_9781788116169_t.indd 6 08/07/2019 11:34 Contributors Angel Aguiar is Research Economist, Center for Global Trade Analysis (GTAP), Department of Agricultural Economics, Purdue University, West Lafayette, Indiana, USA. Ratih Pratiwi Anwar is Researcher, Center for Asia-Pacific Studies of Universitas Gadjah Mada, Yogyakarta, Indonesia. Erwin Corong is Research Economist, Center for Global Trade Analysis (GTAP), Department of Agricultural Economics, Purdue University, West Lafayette, Indiana, USA. Huong Dinh is Visiting Fellow, Research School of Population Health, the Australian National University (ANU), Canberra, Australia. Anna Fink is Economist (Regional Cooperation), Regional Cooperation and Integration Thematic Group, Sustainable Development and Climate Change Department, Asian Development Bank, Manila, Philippines. Elisabetta Gentile is Economist, Macroeconomics Research Division, Economic Research and Regional Cooperation Department, Asian Development Bank, Manila, Philippines. Saibal Kar is Professor, Centre for Studies in Social Sciences Calcutta, Kolkata, India; Research Fellow of the Institute of Labor Economics (IZA) Bonn, Germany. Maki Kato is Associate Professor, Mori Arinori Institute for Higher Education and Global Mobility, Hitotsubashi University, Tokyo, Japan. Aiko Kikkawa is Economist, Regional Cooperation and Integration Division, Economic Research and Regional Cooperation Department, Asian Development Bank, Manila, Philippines. Kakali Mukhopadhyay is Professor, Gokhale Institute of Politics and Economics, Maharashtra, India; Adjunct Professor/Senior Academic Fellow at McGill University, Montreal, Quebec, Canada. vii GENTILE_9781788116169_t.indd 7 08/07/2019 11:34 viii Skilled labor mobility and migration Sasiwimon Warunsiri Paweenawat is Assistant Professor, School of Economics, University of the Thai Chamber of Commerce, Bangkok, Thailand. Eric B. Suan is Associate Economics and Statistics Officer, Statistics and Data Innovation Unit, Economic Research and Regional Cooperation Department, Asian Development Bank, Manila, Philippines. Jessica Vechbanyongratana is Assistant Professor, Faculty of Economics, Chulalongkorn University, Bangkok, Thailand. GENTILE_9781788116169_t.indd 8 08/07/2019 11:34 Foreword Over the last four decades, the Association of Southeast Asian Nations (ASEAN) has maintained economic growth well above the global aver- age, with gross domestic product expanding more than 5% annually. The exceptions were the 1997/98 Asian Financial Crisis and the 2008/09 Global Financial Crisis. If current growth rates continue, ASEAN will become the world’s fourth-largest economy by 2030—behind the United States (US), the People’s Republic of China, and the European Union. This rapid economic growth has expanded an increasingly wealthy middle class, more willing to pay for better, higher-quality goods and services. It has fueled mass urbanization through both intra- and cross- country migration—as rural workers move to the cities and workers from less-developed areas and countries look for better opportunities in more advanced ones. Southeast Asia’s urban population is expected to grow by nearly 100 million people—to some 373 million—by 2030. For example, Malaysia’s urban population should reach 80% of its total population, similar to the current shares in advanced economies like the US, France, and the United Kingdom. Bangkok and Ho Chi Minh City are projected to become megacities—with 10 million people or more—joining Jakarta and Manila. Improved living standards are closely associated with demographic change: Singapore, Thailand, Viet Nam, and Malaysia are rapidly aging. Estimates suggest Singapore’s share of the population that is 65 years and older will be more than double the number of those younger than 15 by 2030, with old and young populations comparable in Malaysia by 2040. Thailand and Viet Nam will likely complete the transition from aging to aged societies—with between 14% and 20% of the population 60 years or older—in 2024 and 2039, respectively. Yet countries like the Philippines and Indonesia remain at an early stage of demographic transition, potentially benefiting from a demographic dividend over the next several decades. Finally, rapid technological advances have the potential to disrupt labor markets. While industrial robots have been confined to routine and manual tasks for a long time, they are increasingly capable of undertaking nonroutine and cognitive tasks. We observe markets for these sophisticated robots in Indonesia, Malaysia, Thailand, and Viet Nam. ix GENTILE_9781788116169_t.indd 9 08/07/2019 11:34 x Skilled labor mobility and migration All these developments—structural transformation, urbanization, demographic change, and rapid technological advances—could disrupt labor markets and displace workers, simultaneously spurring demand for new, more highly
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