Asia Pacific (APAC) faces a digital skills challenge. Confronted with rapid technological changes such as the transition to cloud computing, the advent of internet of things and the introduction of automation technologies, workers in the APAC region face the increasing pressure to upskill digitally to take advantage of new opportunities, prepare for highly skilled jobs, bring new innovations to a local or global market, or solve challenges that will help improve the way people live and work. However, there is evidence of a growing digital skills gap in the region.

A 2019 survey by the Asia Pacific Economic Cooperation (APEC) of employers, government officials and academics found that three-quarters of respondents believed there was a significant digital skills gap in their country. This gap appears to have been amplified by the Covid-19 pandemic due to the rapid push for digitalisation by enterprises aiming to ensure business continuity. For example, a survey conducted within the first six months of the outbreak in Singapore found that although 94 per cent of employers were using data to make business decisions more often than a year ago, 93 per cent felt that their staff lacked adequate skills. Further compounding this challenge is a limited understanding of the specific digital skills needed by workers. The 2019 APEC survey revealed that over 50 per cent of respondents in APAC countries believed their governments and educational institutions had a “weak understanding” of the digital skills landscape in their countries, in particular, the specific digital skills that were deemed inadequate in their workforce.

Despite company leaders across different sectors stating that they faced challenges in filling the positions requiring specific digital skills such as data analytics, over half the survey respondents felt that educational institutions did not reflect the need for advanced digital skills. At the same time, much of the past literature assessing digital skill needs has focused on these skills as if they were one homogenous block. However, as digital technologies become ubiquitous in the workplace, a more granular understanding of digital skill needs is crucial.

A recent study commissioned by Amazon Web Services takes a “worker-centric” approach to understand future digital skill needs in six APAC economies (Australia, India, Indonesia, Japan, Singapore and South Korea) by developing insights into the number and types of digital skills that different worker groups will need to gain by 2025, in order to keep pace with technological changes. The key findings of this study are as follows:

  • As per the study, 64 per cent of Australian workers apply digital skills in their jobs – the highest across the six APAC economies, followed by Singaporean workers at 63 per cent, South Korean at 62 per cent and Japanese workers at 58 per cent. In contrast only 19 per cent of Indonesian workers and 12 per cent of Indian workers apply digital skills in their jobs. That said, India ranks the highest when it comes to the proportion of digital workforce that applies advanced digital skills – referring to the ability to customise digital solutions to organisations’ needs, and/ or to create new digital tools, software and applications to address often complex business or organisational goals. India’s digital workers exhibit the highest levels of advanced digital expertise among the countries, with 70 per cent of them applying advanced digital skills. This figure stands at 50 per cent for Japan, 22 per cent for Singapore, 21 per cent for South Korea and 20 per cent for Australia.
  • Across all six countries, devices and software operations skills are most utilised, while digital content creation skills are least applied. The fact that devices and software operations skills are the most applied digital competence across countries is not surprising – considering that the ability to use a computer and operate software is a prerequisite for most workers today. Meanwhile, countries’ low utilisation rates for digital content creation skills reflect that such skills are largely applied by a limited segment of the workforce today. Ranging from the basic ability to generate digital content (for example, posting marketing content on social media) to more advanced capabilities such as web and software development, such skills are largely utilised by marketing, editorial, digital media and technology professionals.
  • By 2025, the average worker in the region would need seven new digital skills to keep pace with technological change and the number of workers requiring such skills will grow fivefold. For this to happen, an estimated 5.7 billion digital skill trainings will be needed in the six APAC countries over the next five years. In addition, the number of workers applying digital skills in these countries will increase more than fivefold, from 149 million workers today to 819 million workers in 2025.
  • In each country, there are four types of workers who will require new digital skills by 2025. These workers are current digital workers, current non-digital workers, future workers (today’s students) and disenfranchised individuals (those who are unemployed or involuntarily excluded from the labour force). While current digital workers are projected to represent 50-60 per cent of the total digital skill training needs by 2025 in high-income economies, non-digital workers will represent the bulk of the required training in middle-income economies such as Indonesia and India (at 36-45 per cent).
  • Advanced cloud computing and data skills will become more important for digitally skilled workers and future workers (today’s students), with these skill needs projected to triple by 2025 – the greatest increases forecast across all competencies. Current digital workers will need to focus on training in advanced cloud computing skills (referring to the ability to transition enterprises from on premises-based to cloud-based infrastructure, and the ability to design and refine new cloud architectures) as well as advanced data skills (referring to the knowledge of data mining, engineering and science techniques, and the ability to create large-scale data models and database technology). Both these advanced competencies are projected to see the highest increase across all digital skills in the six countries by 2025, with the number of workers needing these skills expected to triple over the next five years. These are followed closely by advanced devices and software operations skills (referring to the ability to deploy software in organisations, and to create operations support protocols for new software), and advanced digital content creation skills (referring to the ability to integrate digital tools to develop customised or original digital content or products such as websites, games and software, as well as the tools to create them), for which skill needs are expected to increase by 2.8 to 2.9 times by 2025.
  • Almost 60 per cent of non-digitally skilled and disenfranchised workers will require basic digital skill training in all competency areas by 2025. This would be important for non-digitally skilled workers to either improve productivity in their current jobs or transition to better jobs, as well as for disenfranchised individuals to access job opportunities.
  • In order to meet the projected digital skill needs by 2025, each country will require different policy approaches that address their unique challenges and skill priorities. In Australia, projected critical skill needs for advanced cloud computing and data modelling skills could be addressed by increasing the availability of short-term flexible courses and catalysing stronger industry-academia partnerships to build expertise in these areas. For Indonesia, it is pertinent to develop sector-specific digital skilling frameworks to guide industry on the digital competencies needed by workers, as well as basic digital skills development programmes for the country’s large number of unemployed youth.
  • In India, both non-digitally skilled and disenfranchised workers could benefit from more targeted digital skill training programmes delivered at scale (especially for women and youth). In Japan, the development of sector-specific digital skilling road maps could help employers lead training efforts for non-digital workers, while current skilled workers could benefit from greater availability of short-term flexible courses as well as longer-term structured skilling programmes that are recognised by industry. In Singapore, it is recommended that training opportunities in skills with the largest forecast skill needs, in particular cloud computing and digital content creation skills (for example, web development and software programming), be expanded for both workers and students. In South Korea, it is critical for the government to stimulate greater demand for the wide range of digital skill courses that are already available in the country; in addition, higher education institutions could incorporate skill development programmes in cloud computing and digital content creation in mainstream curricula.

Based on a report by AlphaBeta, titled “Unlocking APAC’s Digital Potential: Changing Digital Skill Needs and Policy Approaches”. Released in 2021, it was commissioned by Amazon Web Services.