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Southeast Asia – Asean Economic Community to add jobs but deepen skills shortages

21 August 2014

A plan by Southeast Asian countries to establish a European Union-inspired single market next year could worsen inequality and is likely to benefit men more than women, according to the "Asean Community 2015: Managing Integration for Better Jobs and Shared Prosperity" report launched by ILO and Asian Development Bank (ADB), reports channelnewsasia.com.

The Association of Southeast Asian Nations (ASEAN) has set 2015 as the target to create a single economic market across the 10-nation bloc that is home to some 600 million people. It is aimed at improving the flow of goods, services, investment, and labour around the region.

The single market could add an extra 14 million new jobs and boost Southeast Asia's annual growth +7.1% by 2025, according to the joint study by the UN's International Labour Organisation (ILO) and the Asian Development Bank.

However, the study also warned the gains may not be evenly distributed, and the plan could increase already large gaps between rich and poor across the region: "Unless decisively managed, this could increase inequality and worsen existing labour market deficits - such as vulnerable and informal employment, and working poverty.”

It called for Southeast Asian countries to develop policies that support "inclusive and fair development" and to improve social protection.

The study also found that the share of new jobs going to women across the region would be smaller than those going to men.

Sukti Dasgupta, an International Labour Organisation economist and researcher on the study, said this was due to the sectors that were likely to be boosted by integration, such as construction and transport.

The study found that integration would benefit Cambodia, as well as other lower-income countries the most, while hitting Indonesia the hardest.