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6th Asia Economic Forum
Maximizing Asia's Strategic Roles in the World: Opportunities, Prospects and Future Challenges
Asia's Growing Demand for Human Resources: Challenges and Priorities
Phnom Penh, 21 January 2010

Dr. Ing Kantha Phavi
Minister
Ministry of Women's Affairs
Royal Government of Cambodia
Human Development
Human resource development typically focuses on education and training. Human development more
broadly is about putting people at the center of development1.
At all levels of development the three essential capabilities for human development are:
 to lead long and healthy lives
 be knowledgeable, and
 have a decent standard of living
If these basic capabilities are not achieved, many choices are simply not available and many
opportunities remain inaccessible.
The human development approach goes even further: essential areas of choice range from political,
economic and social opportunities for being creative and productive, to enjoying self-respect,
empowerment and a sense of belonging to a community.
The conditions needed for people to reach their full potential require far more than education and
training. The challenge lies in enlarging people’s choices and enhancing human capabilities (the range
of things people can be and do) and freedoms.
To achieve human development for all, existing social inequities will need to be addressed –
eliminating poverty; responding to gender inequalities; and, ensuring that disadvantaged groups,
including the disabled and ethnic minorities, are not left out.
Asia Context
Asia is home to more than half of the global population ranging in size from tiny Maldives with a
population of 300 thousand to the giants China and India, each with populations of well over a billion.
The region is highly diverse in terms levels of development, natural resources, and political
institutions, and is home to a rich mix of cultures and traditions. This diversity provides many
challenges to maximizing Asia's strategic role in the world.
Levels of development vary widely in the region with per capita annual income ranging from $400 in
Nepal to $38,000 in Japan. Levels of poverty range from negligible in the region's high income
countries to less than 3% in China to 40% in Bangladesh2.
Growth in labour productivity and export growth particularly exports from China contributed to
Asia’s recent economic dynamism with a GDP growth in Asia Pacific region between 2000 to 2006
at an average annual rate of 6.3% compared with growth of 3.1% in the rest of the world.
From the gender perspective, worldwide and particularly throughout the region, women play a critical
role in poverty reduction and economic growth and during this economic crisis, women have been
considered as the cushion to mitigate the negative impact on family livelihood. However much of
their contribution is hidden in the informal sector of the economy; in Cambodia, approximately 80
1
2
UNDP. Human Development Reports Glossary of Terms.
World Bank. World Development Report 2010, Statistical Annex.
percent of all employment is in the informal sector of the economy and informal sector businesses are
by far the most important sources of income for women outside of subsistence agriculture.
Global and regional trends affecting human development in Asia
Globalization: Growing connections and interdependencies between countries in investment, trade,
tourism, development assistance, cultural exchange, etc. make it increasingly important for countries
to be able to compete effectively in global and regional markets, and maintain effective relationships
with other nations. The economic and financial crisis clearly demonstrates the vulnerability of our
economies to conditions in other countries. Exports and tourism have declined in the region with
consequences for livelihoods as well as for household and government resources to pay for education,
health and other development services. In the face of economic crisis, gender equality concerns are
often given less priority – despite the fact that Asian women make substantial contributions to our
economies and are well positioned to help mitigate the impact of economic downturns.
At a global conference on the "Future of Globalization" held in Toronto, Canada in early 2009, Fareed
Zakaria, editor of Newsweek International and CNN contributor noted that the first wave of
globalization was facilitated by governments, "but to move forward, we will need communities and
people and companies. . . Diversity and inclusion are essential to success."3 A global study “Global
diversity and inclusion in the workplace” looks at the advantage that diversity and inclusion bring to a
company as well as the challenges inherent in creating and managing an integrated workforce.The
study noted that the main advocates for are the CEOs and top management and the heads of HR and
most companies recognize that diversity and inclusion are closely linked and that inclusion helps to
ensure that employees from diverse backgrounds are able to contribute, remain with the company and
flourish. It also mentions in most parts of the world the main focus of diversity efforts is on hiring and
promoting women who represent an under tapped resource which companies will need in the future
due to the ageing workforce.
Climate change4: Development goals are threatened by climate change, with the heaviest impacts on
poor countries and poor people. Poor communities are less able to manage the effects of adverse
climate trends, variations and shocks. Anticipated declines in agricultural yields in at least some parts
of the region have implications for malnutrition and greater resistance to illness. As temperatures rise,
the number of people exposed to malaria and dengue is expected to increase with the burden most
pronounced in developing countries. The burden of diarrheas diseases from climate change alone is
projected to increase in both low and medium income countries. Loss of assets due to climate change
has implications for the capacity of households to keep their children in school.
Developed countries have an obligation to reduce their carbon emissions and make more efficient use
limited global resources. Developing countries need to recognize that new approaches to energy
production and use, transportation, and even lifestyle aspirations are needed in the development of
infrastructure in order to avoid becoming part of the problem of the greenhouse-gas-intensive
approach to development which is driving global warming, the consequences of which developing
countries are least able to manage. What is most alarming is that the Asia Pacific region is predicted
to suffer some of the most severe impacts of greenhouse gas emissions and climate change. Rapid
economic growth has led to high energy demands but also to substantial increases in carbon emissions
(China…)
Gender-responsive human development in Asia is made all that more important and far more complex
in the context of globalization and climate change. Women and men experience globalization and
climate change differently. Climate change impacts and policies are not gender neutral because of
differences in responsibility, vulnerability, and capacity for mitigation and adaptation. Empowerment
and participation of women in decision making in response to climate change have been shown to
lead to improved environmental and livelihood outcomes that benefit all.
3
4
WorldLINK, Magazine of the World Federation of People Management Associations, April 2009.
World Bank. World Development Report 2010.
Both globalization and the urgent need to respond to climate change require increased attention to
human development and capacities. It is human creativity and innovation, and the ability to work and
live in new ways which will best enable us to compete in a global marketplace, mitigate the impacts
of economic crises and climate change, enlarge people's choices, and adapt to a more sustainable path
to development for all.
So what are the challenges and priorities with regard to Asia’s human resources development?
The diverse nature of the economies of countries in Asia suggests that human resource development
needs to be looked at more broadly if we are to fully meet the challenges facing us in developing our
human resources and maximizing Asia's strategic role in the world.
Asia with its favourable demographic and labour force and high investment rates with a human capital
highly educated and skilled allowing for higher value-added production has performed so well in
recent years leading to labour productivity gains.
In addition, Asia is still a cost competitive region leading to prime destination for production ,foreign
investment and services and it has been undergoing a shift in employment away from lower value
added agriculture into higher value added industry and service sector activities. Most Asian countries
have also rapidly become more open to international trade particularly with regard to increased
exports.
In term of employment generation, economic growth in recent years has been generally less
employment intensive in many Asian countries. For instance, in Asia Pacific, employment grew at an
average annual rate of less than 1.6% between 2001 and 2006, much of this change is due to declining
population and labour growth together with a shift away from labour intensive agriculture to services
and more export oriented, capital intensive manufacturing.
An estimated 61.9%5 of the region’s workforce( more than a billion) still works in the informal
economy with little or no social protection and often in low productivity jobs which do not guarantee
a decent income. Despite the progress in term of extreme poverty reduction, still 51.9% of the
region’s workforce live less than US$2 per day. One main reason is that recent growth has been
driven by a few dynamic sectors such as high value added services and export industries. Therefore
much remains to be done to ensure that the benefits of Asia’s future economic growth will be more
equitably distributed. To mention that gender inequalities are prevalent in the informal economy
where women are concentrated at the lower end of the scale.
Setting aside the broader issue of social and environmental sustainability, Asia’s potential for robust
economic growth in the future remains important as generally favourable demographic trends are
expected to persist, as some countries move further away from low value added agriculture to high
value added industry and services. The rapid growth of China and India is helping to drive the
process. There seems to have also an expansion of trade and investment.
As a whole if Asia continues to grow at a rate of 4.5 to 4.7%, it is expected to account for a growing
share of global GDP up from 24.7% to around 30 to 31% in 2020 and growing demand in human
resource able to cope with new skills and able to compete with the global and regional markets.
Asia’s labour force represents approximatively 59% of the world’s total and it is expected to continue
to grow ( the fastest in South Asia) though at a slower pace driven by population dynamics and
declining labour force participation rates. The gap between male and female participation rates will
remain wide. The labour supply pressures faced by countries such as Afghanistan, Bhutan, Timor
Leste, Lao People’s Democratic Republic, Philipines, some Pacific Islands where the number of
working poors are high and the informal economies are large, pose a challenge for decent and
productive jobs creation and poverty reduction. Other countries such as Japan China, Republic of
Korea, Thailand will experience the emerging shortage of labour and other social and economic
consequences of their ageing workforce. A key challenge in these countries is to extend working life
and enhance the employability of older workers who can ensure the knowledge transfer to the next
generation of workers.
5
ILO “ Visions for Asia’s Decent Work Decade : sustainable growth and jobs to 2015”
Asia’s youth labour force accounted for 20.6% of the region’s total labour force and 58.6% of the
global youth labour force. Between 2006 to 2015 the region’s youth labour force is projected to
decline by about 2.3% reflecting both the demographic trends and the increasing participation of
youth in education. Some of the challenges will be to improve job quality and ensure that young
women have the same opportunities as young men. Actually, people need supportive policies and
social protection as they are exposed to various risks and insecurities. There is a growing need for a
life cycle perspective to decent work which focuses on the key stages of life when people are
vulnerable to changes and recognizes the need for security with change.
Another challenge for Asia Pacific region is to address the treatment of migrants in labour markets
The increasing migration of workers during the last decades has also contributed to Asia’s economic
dynamism and has helped reduce poverty.
Gaps
Levels of literacy and education vary widely across Asia with average levels of educational attainment
ranging from a low of 2.5 years in Nepal to 11.7 years in Japan. It should be noted that with the
exception of the Philippines, Sri Lanka and Mongolia, males attain a higher level of education than
females across Asia. This gap tends to be larger in countries with low average levels of educational
attainment.
Although good progress has been achieved in increasing levels of literacy and basic education in most
countries in the region, including Cambodia, there is a clear need to continue to strengthen primary
and secondary education in most developing countries in terms of levels of enrollment and
completion, as well as quality and relevance of basic education to the economic, social and
environmental challenges facing us in the 21st century. There is also a need to upgrade the basic
education of the workforce. This is particularly important for women given their generally lower
levels of literacy and education in the region.
Learning opportunities need to be provided for all, including young people who failed to acquire basic
skills the first time around. Society cannot afford to neglect them – without second chances, these
young people and their families would be condemned to poverty. Governments should therefore
develop a system of remedial education, equivalency programs, literacy programs, and skills training
that takes into account the diversity of these young people6. Governments and companies should
ensure equal employment opportunity for young men and women knowing that women is a large
under tapped resource which they will need in the future due to the ageing workforce.
Much of formal education and vocational training in Asia is focused on memorization and learning
specific technical skills or routine processes. Relatively little attention is being paid to the other types
of skills needed to for success in the workplace and society (see below on “needed human
capacities”). Schools and other education and training institutions will need to incorporate the
teaching of life skills into their curricula to ensure that future labor market entrants are properly
equipped to meet the needs of the workplace and their communities. These skills also need to be
taught to existing workers. This would include behavioral skills and awareness of the basic elements
of responsible citizenship including respecting the rights of others, reducing inequality (both social
and economic, including gender inequalities), refraining from action which hinders individuals' wellbeing, and avoiding contributing to environmental degradation
Needed human capacities
Various sources suggest that there is a need for a core group of attitudes and skills in both workplaces
and communities7. These are sought by employers, critically important for the self-employed, and
crucial to exercising active citizenship:
1) Knowing How to Learn. This skill enables people to adapt quickly to new demands – essential to
meeting the challenges posed by globalization and climate change.
6
World Bank, World Development Report 2007.
Carnevale, AP, et al., Workplace Basics: The Essential Skills Employers Want, Jossey Bass, 1990. See also
www.workplacebasicskills.com
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2) Literacy and Numeracy Skills. In traditional jobs, work often involves a regularized process or
repetitive interaction with machines. Illiteracy and innumeracy could be hidden or ignored. Illiteracy
is, however, a barrier to acquiring information about markets, new skills, concepts and processes for
improving productivity, deal with administrative processes, or exercising citizenship.
Deficiencies in these skills can result in productivity decline, increased accident rates, and costly
production errors, as well as a reduced ability to exercise choices and protect one's rights. Women
have lower levels of literacy in nearly every country in the region (except the Philippines and
Mongolia).
3) Communication Skills: Speaking and Listening Effectively. These skills are at the heart of winning
and keeping customers and constituencies. Introducing innovation, contributing to quality circles,
resolving conflicts and providing meaningful feedback all hinge on effective communication skills.
Studies have shown that only job knowledge ranks above communication skills as a factor for
workplace success. Business leaders estimate that deficiencies in these skills cost employers millions
each year in lost productivity and errors.
4) Adapting to Change: Solving Problems and Thinking Creatively. Organizations, both public and
private, are increasingly placing a premium on workers who are both problem solvers and creative
thinkers. As decision making is decentralized to the point of actual production or service delivery, an
organization's effectiveness may hinge on its workers' ability to solve problems quickly. Competitive
advantage is frequently tied to a company's capacity to innovate quickly.
Creative thinking is generally manifest as creative problem solving or creative innovation. It is the
development of new activities that expand markets or services and improve such elements as
productivity.
5) Personal Development Skills: Managing Personal and Professional Growth.
For an employer to succeed, workers must be motivated. An individual employee's lack of motivation
or goal setting skills can produce repeated errors, absenteeism and quality problems or it can hinder
change. Essential to good worker motivation are the capacity to maintain good health and ability to
meet the basic needs of their families. Gender-based attitudes and norms, and low self-confidence
often make it more challenging for women to balance their personal and professional growth with
their household, childcare and community responsibilities.
6) Group Effectiveness Skills: Interpersonal, Teamwork and Negotiation Skills. To perform work
roles effectively requires good interpersonal, teamwork and negotiation skills. These skills are
essential to successful negotiation of conflicts which are a fact of work and community life.
Negotiation skills include the ability to separate people from the problem, to focus on interests not
positions, to work out compromises for mutual gain, to use objective criteria and an understanding of
the approach demanded by the circumstances.
Teamwork : Teams are organized in the workplace or community so that appropriate talents and skills
can be pooled to accomplish vital tasks and goals. This pooling of resources requires team members to
have an array of skills that individual or routine jobs do not demand.
Team members also need an understanding of group dynamics which evolve and change as the team
approaches its goals
7) Influencing Skills: Organizational Effectiveness and Leadership.
Organizational effectiveness skills are the building blocks for leadership. At its most elementary level,
leadership means that a person can influence others to act in a certain way. Leadership skills are
necessary at every level of an organization from senior management to the line worker.
In addition, workers also need specific knowledge to deal with real-life situations (i.e., technical
expertise) and vocational skills to perform jobs that rely on clearly defined tasks.
Also important is responsible citizenship: Being aware of and taking responsibility for how actions
(of a government, corporation, organization or individual) affect individuals, communities and the
environment.
.
Future Directions
Labour productivity growth is a crucial ingredient of a country’s economic growth and overall
competitiveness .Creating quality jobs and reducing poverty are also critical.
Productivity gains can lead to higher wages, better working conditions and investment in human
resources. They should reach workers at the bottom of the income spectrum to promote the income
equality leading to an equitable development.
Developing productivity growth within low value added sectors such as agriculture in which the
majority of Asia’s working poor are still engaged can be a key driver of an economy wide
productivity growth.
Firms and workers play an important role in the equitable distribution of productivity gains.
Progressive workplace practices based on good working conditions, innovations in work organization,
continuous learning with development, good labour management relations in the context of rapid
environment changes and staff motivation can raise productivity while also promoting decent work.
Building the capacity and productivity of employees through appropriate workplace organization and
establishing an open communication channels leading to workers heightened engagements. It’s
essential for firms to benefit also from increased productivity as this allow them to make investments
and fuels the innovations needed for future growth.
In a recent survey of human resource professionals in corporations throughout the world8, the three
issues most often chosen by human resource managers in Asia were change management, leadership
development and succession planning.
Change management and leadership development are clearly important throughout the region,
particularly within the context of global and regional trends. Succession planning for corporations is a
particular concern in higher income countries in the region however generally less important in Asia's
low income countries where a significant proportion of the population is in the informal sector of the
economy and struggling to meet basic needs.
At the same time there will be challenges face to heightened competition particularly in industry and
markets currently dominated by the more developed economies as certain Asian countries such as
China expands into higher value added industries. This requires a policy environment that is
conducive to openness to trade, investment and new ideas. Investment in human capital are essential
for ensuring that workers have the skills required in emerging occupations.
The fact that more than one billion Asians are still working in the informal economy reflects a
troublesome inability of the formal mechanisms. Therefore bringing informal workers into the
framework of social protection and into the underlying tax base will also be essential for sustainability
of the development. Expanding access to local and global markets through improved linkages with the
formal businesses, better infrastructures and through investments in training and skills development of
informal sector operators are concrete examples of supportive policies.
Growth and sustainable development in Asia Pacific could be seriously undermined by environmental
degradation, depletion of natural resources and climate change. Consumption in over the half of the
region countries currently surpasses their productive natural resources capacity. Asia Pacific region is
predicted to suffer some of the most severe impacts of green house gas emissions and climate change.
This increasing concern in the region might push the Asian countries to strengthen cooperation to
promote more sustainable natural resource use as well as more efficient energy use through
technology and knowledge transfer. There are likely opportunities for green jobs creation and building
capacity of human resource in managing the new paradigm.
Through such interventions we will support human development, build human resources to meet the
challenges of the new millennium, and support the development of a greater Asian community in
sharing the benefits of growth, knowledge and experience across countries.
.
8
PriceWaterhouseCoopers, Survey of Global HR Challenges: Yesterday, today and tomorrow, World Federation
of Personnel Management Associations, 2005.