Migrating to Opportunity: Overcoming Barriers to Labour Mobility in Southeast Asia

Intra-regional migration in the ASEAN (Association of South East Asian Nations) region has increased significantly, turning Malaysia, Singapore, and Thailand into regional migration hubs with 6.5 million migrants. But migration policies in the region have a way to go to better match countries’ evolving economic needs, and allow workers to more easily pursue better careers and education across ASEAN.

According to a new report from the World Bank Group, managing migration better in the ASEAN region can boost workers’ welfare and accelerate economic integration. ASEAN migrants are often low-skilled and undocumented, compelled to move in search of economic opportunity, mainly in the construction, plantation, and domestic services sectors. Higher-salary jobs are available, yet workers are not always able to take advantage of these opportunities. The ASEAN Economic Community has taken steps to facilitate mobility, but these regulations only cover certain skilled professions – doctors, dentists, nurses, engineers, architects, accountants, and tourism professionals – or just 5% of jobs in the region.

Overall, migration procedures across ASEAN remain restrictive. Barriers such as costly and lengthy recruitment processes, restrictive quotas on the number of foreign workers allowed in a country, and rigid employment policies constrain workers’ employment options and impact their welfare. These restrictive policies are partly influenced by the perception that an influx of migrants would have negative impacts on receiving economies, but recent studies have not confirmed this perception.

The impact of labor mobility on the region’s economies can be significant, as migration could provide individuals from lower-income countries with the opportunity to increase their incomes and create new employment opportunities for local workers in sending and receiving countries. The report estimates that reducing barriers to mobility would improve workers’ welfare – by 14 percent if only targeting high-skilled workers, and by 29 percent if including all workers.

On a country-by-country basis:

• the highly-developed support system for migrant labor in the Philippines can serve as a model for other countries. However, the country should continue its focus on improving reintegration of returning migrants
• Indonesia could improve coordination among relevant agencies and streamline procedures
• Vietnam can benefit from a national migration strategy to guide reforms and from evaluating the effectiveness of the programs introduced over the last years
• Outmigration can be costly, particularly in lower-income countries such as Cambodia, Lao PDR, and Myanmar, where simplifying formal processes could help reduce costs
• Malaysia could adjust its migration policies to the country’s economic needs, including by revising its current levy system and by deepening coordination with sending countries
• Thailand may benefit from formalizing undocumented migrants and making entry procedures less costly, and
• Singapore has developed a highly sophisticated and well-functioning migration system; it is key that attention should continue to be paid to the welfare of migrant workers.

Changing policies for sending and receiving countries can improve intra-regional migration. A range of policies can be implemented to enhance workers’ mobility, which could have a significant impact on their economic performance, and the economic performance of the country and region as a whole.

For access to the World Bank Group report, please click here.