High Value Talent needed to tap into Asian century

Saturday, 11 February 2012 | Filed under Human Capital, Nation Building

Turn on the news anytime of the day and there’s a lot of unhappy news about the global financial turmoil. From major companies going bankrupt to the man who can’t get a job to feed his family.

But despite some dire predictions, we in Asia have a silver lining.

By all projections, Asia will be the fastest growing region in the world no doubt driven by the two giant economies of China and India.

Malaysia is by all accounts sitting pretty - right in the heart of the region that is being wooed by the world, with its heady promise of 4 billion people accounting for over 60% of the world population.

According to the Asian Development Bank (Key Indicators for Asia and Pacific 2010), Asians are ‘likely to assume the traditional role of the US and European middle classes as global consumers”. Projections suggest that by 2030 much of developing Asia will have middle and upper class majorities.

Translated: People will have high disposable incomes, and be hungry for lifestyle products that reflect the new wealth.

Translated: These new products will come about from innovation.

Translated: Innovation will separate the weakest and strongest economies in Asia.

The best talent will go where the culture of innovation thrives

Countries in Asia, long renowned in the 20th century for their high quality graduates, are investing huge amounts of money to reverse what was long a staple of their curriculums - rote learning designed to implant black or white answers to exam questions.

Malaysia is no different for it is an uphill struggle to get people to change embedded mindsets.

And I don’t mean the young people, who would be the easiest to get to adopt a culture of welcoming challenge and pursuing innovation.

It is the administrators and bureaucrats who are often the stumbling blocks to innovation, and the price is paid in the quality of human capital that results.

That our human capital largely lacks the innovation mindset and suffers from weak muscles when it comes to competition could become our Achilles heel, when countries all around us are single-mindedly focusing on building those very muscles in their youth populations.

They suffer no illusions that if our young people do not learn to compete equally in their own country, they will fail miserably in being able to compete with the best brains from around the world.

Draining talent, importing migrants

The World Bank says that for every 10 skilled Malaysians born in the country, one of them elects to leave the country. This is double the world average.

The number of skilled Malaysians living abroad has tripled in the last two decades,  mostly to OECD (Organisation for Economic Cooperation and Development) countries or Singapore.

As we lose our best to other countries, we are importing low-skilled migrants by the millions.

The World Bank’s 2011 Migration and Remittances Factbook calls us a ‘receiving country’ with as many as 2.4 million immigrants. Of these, it says some 40% have secondary education, with another 40% with no formal education at all.

Translated: Low skilled immigrants depress wage levels, productivity and innovation.

This skewed scale is opposite of what our neighbours are doing.

High-Value investors need highly-value skills

High incomes are driven by high quality products.

And with Asia now in the crosshairs of the world as a consumer mecca, investors are going to be coming here with money and technologies to tap into this market.

These investors will be looking to employ high-quality talent and partner with innovative companies in the local markets for their products and services.

At present, only 23% of Malaysia’s current work force is highly skilled. Prime Minister Datuk Seri Najib Razak said this number must rise to 37 % by 2015 if it is to become a developed nation by 2020.

The numbers are worrying and despite the fact that we have 20 public and 26 private universities which churn out 180,000 graduates a year (another 120,000 graduate from the 1,000 skills training institutes), most vacancies are not for high-value jobs.

Even the government’s job portal JobsMalaysia, shows vacancies to be mostly in manufacturing, agriculture and construction.

Translated: We are not attracting the kind of high-value investors that we need to if we are to become a high-income nation

We have been told for over two decades that our goal is to become a world-class nation.

But world-class - as inspiring and aspirational a notion that it is - will ring hollow if we cannot bring ourselves to set world-class standards from the onset.

World class is predicated on meritocracy.

World class can only happen if we keep the best talent at home.

World class is not what we say, but what others say of us.

And right now, we are far short of the mark when it comes to our human capital.

Asia is the power centre of this century.

Every country around us is angling for a big chunk of the pie.

The playing field out there is for the countries with the best talent to reap the rewards.

It’s really quite black and white.