At the end of 2015, the 10 ASEAN nation states are on track to create the ASEAN Economic Community (AEC) as a means to support the free flow of labour across Asia, and benefit all economies falling within the AEC by sharing human resources. Cambodia is expected to gain benefits through increases in foreign direct investment into the Cambodian market -but how the AEC will change the face of the domestic Cambodian labor market remains uncertain.
With the ASEAN Economic Integration at the end of this year, Cambodia seemingly must strengthen its capacity in terms of human resources and professional expertise if it is to meet the regional market’s demand when the AEC integration fully comes into play.
After the integration, labor flow will increase considerably for professionals with internationally transferable skill sets, such as accountants, health professionals, engineers, researchers and tourism workers. These Cambodian professionals will now be able to apply for positions throughout the region without restriction, and potentially gain higher wages.
Chan Sophal, Director of the Centre for Policy Studies in Cambodia, said the AEC will bring new labor flows to professions that require high skill labor inside and outside of Cambodia. This means, ' ... Enterprises in need of skilled workers within Cambodia will be able to hire them more easily than at present because the potential market will be larger,” he said.
As inter-ASEAN competition increases between its members in terms of labor flows, Cambodia must strengthen the aggregate capacity of its own human resources in order to meet the competitive labor market of ASEAN in the coming years, and to ensure employment opportunities inside and outside of Cambodia. In order to strengthen the labor market for the AEC, Sophal said, “the number one priority must be to better train and educate our students. This is the only way we can compete.”
In regards to whether Cambodia is ready for the ASEAN economic integration, Sophal explained that, “While I think we have strengths and weaknesses within the Cambodian market, ASEAN, fully integrated, will provide opportunities to attract domestic investment that will in return create jobs for skilled and unskilled workers within Cambodia. In addition, new competition in the labor market within Cambodia is seemingly going to be limited due to the variability of criteria that may or may not attract workers to Cambodia.”
Chrek Sok Ny, CEO of Century 21 Mekong, said the present Cambodian market is getting ready for the integration in many ways: 'I think it's beneficial to bring in new technologies and methods for construction into Cambodia in regards to construction standards and levels of development. But meanwhile, the AEC will boost Cambodian economy and strengthen cultural connectivity of all member countries. There will be free flow of goods and labor, and Cambodian workers will migrate for jobs abroad; whereas skilled workers from member countries will enter Cambodia filling the increasing demand for higher skilled positions that this development demands.”
A joint publication released by the ADB and ILO at the end of last year, showed that Cambodia could be one of the leading beneficiaries of the AEC through the creation of an estimated additional 1.1 million jobs by 2025. Low-skilled jobs will account for 71.2 percent of this increase, predicts the publication, meanwhile, medium-skilled professional roles may increase by around 722,000 jobs.
Despite that, the same publication goes on to say that Cambodians may well lose their domestic employment opportunities if there is no improvement in the market in regards to workers’ training and education. Furthermore, domestic higher-skilled workers may still look to migrate outside of Cambodia, as opportunities for higher salaries will now be available.
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