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Do you still see your company as competitive in the intensified landscape of digitalization and Industry 4.0?

In most cases, training your employees with the right skills needed in the future is an important measure to keep pace and take advantage of emerging opportunities. In this Future Trends section, companies will get an overview of current trends and key terms to better predict and meet upcoming skills needs


Future Challenges Impacting Skills Develop­ment

Human resource development is of key importance to ASEAN Member States (AMS), as various mega-trends are creating demand for a range of future skills that are currently in short supply. 

Mega Trend 1 - Digital Transformation

Technological change has always been a major driver of change in society, business and personal life. The recent wave of technological advances in areas such as artificial intelligence, robotics, virtual reality, the Internet of Things, cloud computing, 3D printing, etc. is just one new cycle that may impact the future of work and, accordingly, the future of skills.

For many countries, the new technologies require them to change their economies, moving from a low-skill economy to a high-skill economy. While this change presents many challenges, it also offers great potential for companies to increase profits by adding new value-added services to their existing product line. To take advantage of this opportunity, a highly skilled workforce is needed that can develop and implement new digital products or services.

However, there is still a large mismatch between the human resources available and those required with the necessary digital skills. In addition, many companies are unable to define and assess what specific digital skills they are likely to need in this context and feel overwhelmed by the multitude of opportunities. One promising way to overcome this challenge is to invest in training initiatives to build the necessary skills. With the support of properly trained in-company trainers and a private sector-led skills development reform, TVET has the potential to be the critical success factor in a company's digital efforts.

Mega Trend 2 - Labour Market Transformation

There is a broad consensus that the integration of digital technologies will lead to a substitution or redefinition of many current jobs and introduce new forms of work. In this context, the path from low-tech industries to high-tech industries is complex and often selective, as almost every occupation has at least partial automation potential. 

Research in the ASEAN context has already quantified this evolution by industry in six Southeast Asian countries. Results indicate that there will be significant technology-induced job displacement, especially in low-skilled industries such as agriculture, manufacturing, and wholesale and retail trade (s. Technology and the Future of ASEAN Jobs). In these industries, automation technology will take over a large share of the tasks previously performed by humans. On the other hand, new jobs will be created where skill requirements will change and higher skilled workers will be in demand. Examples of such jobs are technically skilled machine operators, data analysts, IT developers, etc. 

To close this gap or to counteract the mismatch between "old" and "new" job profiles, retraining and continuing education initiatives are needed to transfer the displaced workforce into new occupational fields.

In the ASEAN region, a mismatch between skills supply and demand is already visible; in particular, a shortfall in vacancies requiring more and new skills. Clearly evident is the high number of workers expected to be laid off and need to be transferred to new occupations. In this regard, skills development plays an important role in successfully responding to the newly created market demand for skilled labor.

Mega Trend 3 - Social Inequality and Lack of Social Inclusion

Most research assumes that digital transformation and the transformation of labor markets will increase economic polarization in most countries, leading to less inclusion and more inequality.

In this scenario, low-skilled workers are particularly at risk of being replaced by digital technologies, as they perform most of the tasks that could be automated as part of the labor market transformation. Another gender equality issue is the limited career opportunities for women in well-paid, high-status occupations. These occupations are still more likely to be held by men.

To overcome the aforementioned inequalities, not only can the public sector take preventive measures, but companies also have the opportunity to counteract this trend. By offering training for women and continuing education opportunities for the low-skilled, companies are given the opportunity to close their gaps in qualified workers.

Mega Trend 4 - Environmental and Climate Change

While the impacts of climate change on agriculture, fisheries, tourism, and health are damaging, new opportunities in the green economy offer new approaches to offset losses in traditional employment sectors.

The link to TVET is obvious, as green jobs require specific skills. Significant sectors for "green" opportunities lie in sustainable agriculture, renewable energy, and the circular economy. Here, innovators who challenge the practices and status quo of large companies are especially needed to initiate meaningful change.

Companies looking to gain a foothold in this market are therefore advised to provide their employees with specific training tailored to the green economy in order to achieve sustainable success in the future.

An Approach Towards Determin­ing Future Skills

what kind of qualifica­tions will be needed in the future?

It is difficult to formulate a generally valid answer to this question, as the exact future skills requirements and the corresponding training recommendations are very company-specific. We therefore tend to recommend that companies draw up an individual future assessment tailored to the requirements of their respective market and industry.

To assist companies with the assessment, we identify generic skills that are of high value in our modern era. Companies must then consider and apply which specific capabilities are required for their particular background and industry context. The following list summarizes most of these capabilities identified in research:

Basic Skills


  • Numeracy and literacy 
  • Understanding and applying
  • Analysing, evaluating / critical thinking, creating / innovating


Technical Skills


  • ICT skills / digital literacy (proficient application of hardware devices and software tools)
  • STEM skills (science, technology, engineering and math)

Personal Skills


  • Social skills (communication, cooperation in teams, conflict resolution)
  • Learnability (readiness to learn, curiosity, effective self-learning strategies) 
  • Character qualities (social and cultural awareness, adaptability) 
  • Problem-solving in complex, technology-rich environments

Do companies need to focus on all future skill areas?

For companies to survive in the future, a mix of basic skills, technical knowledge and personal skills is essential. It is not enough to employ people who "only" have single, specific skills. The challenge is to select or train people in such a way that they bring with them the broadest possible range of all future skills relevant to their work context.

What skills should companies focus on?

Future skills can be divided into three main areas: basic, technical, and personal skills. Since basic skills are the foundation for effective learning, they must be made accessible to all in Southeast Asia. Above all, however, technical and personal skills development must be the focus for every organization in the future.

Is the ASEAN region ready for future skill requirements?

The three-fold skills approach is also confirmed and quantified for the ASEAN region, where soft skills in the form of cognitive and interpersonal skills are in particularly high demand. While over 2 million workers need additional training in soft skills, 800 thousand IT specialists are also needed to benefit from mega-trends such as digitalization or Industry 4.0.

Why are technical skills important?

The technical skills of the future focus on the application and use of digital technologies as well as engineering skills. On the one hand, ICT skills help workers develop new digital products and services, which are urgently needed to keep pace with the megatrend of digitalization and new opportunities in this area. On the other hand, STEM skills are particularly important for the green economy. Since needed innovations in this specific market rely heavily on engineering and scientific know-how, STEM skills can successfully counteract the megatrend of environmental and climate change and offer a perspective for the future.