AI and the Future of Work in Southeast Asia: Fixing the Skills Gap

Southeast Asia is a region defined by its diversity, dynamism, and digital ambition. 

I’ve seen first-hand how learning transforms lives across the ASEAN region. For many people, it’s the primary route to a good job and a better life. Today, our economies and societies—built on the foundation of human skills, stand at a critical juncture.

As AI transforms the global economy, it offers immense potential: enhanced productivity, the creation of entirely new jobs, and vastly improved services. But at the same time—job displacement, widening inequality, and a growing skills gap, are a stark reality. The International Monetary Fund predicts that nearly 40% of jobs globally will be impacted by AI, with exposure rising to 60% in advanced economies.

The AI mandate for ASEAN 

While in ASEAN, a pivotal study by TalentCorp revealed up to 620,000 jobs across ten key sectors of Malaysia’s economy are at risk of displacement due to AI and automation. Interestingly, the same report highlighted 60 emerging job roles; 70% in AI and digital, 20% in the green economy, and 10% in new technologies. At the MyMahir National AI Council for Industry (MyMahir–NAICI) in May 2025, YB Steven Sim Chee Keong, Minister of Economy and Human Resources (KESUMA), addressed the issue head-on, stating: “The question is not whether AI will replace jobs, but whether we will empower Malaysians to evolve with it.” This set the mandate for the region: drive transformation that uplifts, rather than marginalises, communities. 

AI intensifying demand for specialised skills

While AI is reshaping industries, the demand for specialised skills is intensifying. The World Economic Forum estimates that 59% of workers worldwide will need reskilling by 2030 to meet changing skills demands. Many employers I speak to report difficulty in sourcing skilled talent—highlighting a growing mismatch between workforce capabilities and industry needs. 

To navigate this shift, we must rethink how we learn. Learning isn’t just about acquiring skills—learning is the skill. 

Redesigning pathways from education to employment

At Pearson, we recognise the pace of change demands new approaches. Employers across Southeast Asia consistently report a mismatch between graduate skills and market needs. In some parts of ASEAN, 75% of employers say recent graduates are ‘not job-ready’. Graduates entering today’s workforce are now expected to be AI-literate, adaptable, and able to think critically.

Earlier this year, Singapore’s Digital Education Council (DEC) partnered with Pearson to modernise learning models and prepare institutions for the demands of education and work.  Its ‘AI in the Workplace 2025’ report indicates ‘a sharp disconnect between industry and higher education: only 3% of employers believe higher education is adequately preparing graduates for an AI-driven future’.   

Driving AI-readiness in Malaysia

Malaysia is making impressive progress in this space, redefining the transition from education to employment. By strengthening collaboration between universities, TVET institutions, and employers, the nation is aligning academic pathways with industry needs, particularly in high-demand areas like AI and green technologies. Digital platforms such as MyMAHIR and MYFutureJobs offer promising solutions to match talent with opportunities more efficiently. The integration of the AI Readiness Index (AIRI) into the MyMahir.my platform is a powerful tool— enabling companies to assess their AI preparedness and take actionable steps toward AI transformation. The common thread with all of these initiatives is identifying talent needs, coordinating skilling efforts, and embracing a digital-first mindset.

Upskilling and reskilling for an AI-driven era

Organisations that fail to adapt, risk leaving their workforce underutilised and unprepared. Many employers are taking a skills-based approach to talent management, with continuous upskilling as part of the solution. But what makes someone well-equipped to thrive in today’s disruptive work environment and handle emerging challenges? 

Our PDRI by Pearson business has conducted extensive scientific research into the human-centric skills that will be essential in an AI-driven economy. Their framework highlights seven key skills—resilience, adaptability, creative problem-solving, continuous upskilling, interpersonal savvy, cultural versatility, and critical thinking. These are the durable, human capabilities that AI cannot replicate— even in today’s disruptive work environment. With AI fundamentally changing how work is performed, and the pace of change accelerating faster than ever, it’s imperative to find people with the right skills.

A call to collaborate

I believe that "learning to learn" will emerge as the defining superpower of this era. 

At Pearson, we’re calling for more dynamic learning approaches that directly align with real-world demands.  

Based on the findings of Pearson’s 2025 ‘Lost in Transition: Fixing the Skills Gap report’, we propose three key interventions to accelerate skills development:

1. Make learning more effective: Our workforce is underprepared for the pace of learning required to keep up with AI-driven disruption. We must move beyond traditional models and teach new, more effective ways of learning that accelerate progress. This is a race against time, and speed is of the essence.
2. Build clearer skilling pathways: The concept of a single, linear career is a relic of the past. Today’s careers are dynamic journeys with many pivots. It’s time to re-design skilling pathways to be more transparent, personalised, and responsive to the evolving world of work. In Southeast Asia, this means strengthening collaboration between universities and employers, embedding career readiness into curricula, and expanding the recognition of micro-credentials.
3. Embrace the collaboration imperative: The scale of this challenge is too vast for any single entity or country to solve. Meaningful progress requires a unified effort by educators, enterprises and policymakers. By working together, we can align national skills agendas across ASEAN with real-world demands. As a global learning company deeply engaged with the national skills agendas across ASEAN, we see a tremendous opportunity to work collaboratively. Together, we can make learning more effective, address critical skills gaps, and empower people to build and maintain fulfilling, future-proofed careers.

This article was originally published by the UK-ASEAN Business Council to highlight the impact of AI on the future of work in Southeast Asia.