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Industry and skill wage premiums in east Asia

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Author Info

  • di Gropello, Emanuela
  • Sakellariou , Chris

Abstract

This paper focuses on the estimation of skill/industry premiums and labor force composition at the national and sector levels in seven East Asian countries with the objective of providing a comprehensive analysis of trends in demand for skills in the region. The paper addresses the following questions: Are there converging or diverging trends in the region regarding the evolution of skill premiums and labor force composition? Are changes in skill premiums generalized or industry-related? How have industry premiums evolved? The analysis uses labor and household surveys going back at least 10 years. The main trends emerging from the analysis are: (a) increasing proportions of skilled/educated workers over the long run across the region; (b) generally increasing demand for skills in the region; (c) the service sector has become the most important driver of demand for skills for all countries (except Thailand); (d) countries can be broadly categorized into three groups in relation to trends and patterns of demand for skills (Indonesia, Philippines, and Thailand; Vietnam and China; and Cambodia and Mongolia); and (e) industry premiums have increased in three countries of the region (Philippines, Thailand, and Cambodia). These trends point to several policyimplications, including that governments should focus on policies promoting access to education to address the increasing demand for skills and/or persistent skill shortages; support general rather than specific curricula given broad-based increases in skill premiums in most countries; better tailor curriculum design and content and pedagogical approaches to the needs of the service sector; and target some social protection programs to unskilled workers to protect them from the"unequalizing"impact of education.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 5379.

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Date of creation: 01 Jul 2010
Date of revision:
Handle: RePEc:wbk:wbrwps:5379

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Related research

Keywords: Labor Markets; Water and Industry; Tertiary Education; Education For All; Secondary Education;

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Cited by:
  1. Rita K. Almeida, 2010. "Openness and Technological Innovation in East Asia: Have They Increased the Demand for Skills?," Asia Pacific Trade and Investment Review, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 17(1), pages 63-95, June.
  2. Giovanni Andrea Cornia & Bruno Martorano, 2012. "Development Policies and Income Inequality in Selected Developing Regions, 1980–2010," UNCTAD Discussion Papers 210, United Nations Conference on Trade and Development.
  3. Almeida, Rita K., 2010. "Openness and technological innovation in East Asia : have they increased the demand for skills ?," Policy Research Working Paper Series 5272, The World Bank.
  4. World Bank, 2012. "Leading with Ideas : Skills for Growth and Equity in Thailand," World Bank Other Operational Studies 2732, The World Bank.

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