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In 2025, the Asian economy faces complex and multifaceted challenges, arising from both external factors, such as the volatility of global trade in goods and services, and also internal issues within individual countries, including infrastructure, political, and human resource problems. In this context, “labor”, as the driving force of each nation’s economy, is significantly affected by these economic challenges. For examples, workers in industries impacted by shifting US trade policies and the rising number of informal workers.
The uncertainty arising from changing global trade landscape, particularly for workers in export-oriented manufacturing within global supply chains, they could have a substantial impact. This is due to Asian countries’ high reliance on exports. Data from the World Bank (2023) indicate that several Asian nations have a high export-to-GDP ratio, such as Cambodia (67%), South Korea (44%), Thailand (65%), and Vietnam (87%). When considering export-sector workers, especially in Southeast Asia, data from the International Labour Organization (ILO) reveals that approximately 14% of the total manufacturing workforce is directly or indirectly linked to final demand in the US.
While in East Asia, South Asia, and the Pacific, these figures are about 8.2%, 6.9%, and 5.4%, respectively. This makes the labor force in Southeast Asia more vulnerable and less resilient to changes in US trade policy than other regions. Consequently, manufacturing workers in the region might need to shift to other economic sectors if they cannot adapt to these situations.
The issue of informal labor, characterized by a lack of social welfare and low resilience to economic changes, remains a significant challenge in the Asia and Pacific region. ILO estimates (November 2024) show approximately 1.3 billion informal workers in the region, accounting for about 66% of total employment. Notably in Southeast Asia, the proportion of informal workers is around 69%, higher than the overall Asia and Pacific average. Even though, these figures indicate progress in reducing the proportion of informal labor over the past two decades (from approximately 80% in 2004), this progress has significantly stalled since the COVID-19 pandemic. Addressing the problem of integrating informal workers into the formal system is therefore crucial for improving their quality of life, which will help support economic stability.
These two interconnected issues represent significant current labor challenges, so suitable policies and mechanisms are essential to mitigate their effects and foster sustainable and inclusive economic development across both the Asian region and individual nations.
Author:
Mr. Atit Saerepaiboonsub
Senior Researcher
International Institute for Trade and Development (Public Organization)
www.itd.or.th
Publication: Bangkok BIZ Newspaper
Section: First Section/World Beat
Volume: 38 Issue: 12941
Date: Wednesday, Jul. 9, 2025
Page: 8 (bottom-left)
Column: “Asean Insight”
