Labour and Education

This study proposes for a minimum wage policy in the private sector due to a lack of labour unions and collective bargaining capacity, especially for the low wage unskilled and semi-skilled sector, unemployed, local youths, and foreign workers. A basic policy was proposed, whereby a blanket minimum wage level is set, applicable to specific sectors that the Government has identified as low wage, informal, and lacking bargaining power.

In view of the pressing policy concern with youth unemployment in Brunei, CSPS undertook an extensive two-year study to better understand youth unemployment issues, including using a longer-term approach which involves strategic foresighting and quantitative labour market projections.

This project consists of seven focus areas:

• Analyse labour statistics to measure youth unemployment and labour underutilisation as well as understand the types and causes of youth unemployment;
• Examine demographic and sociological correlations of youth unemployment using data from a national survey conducted by CSPS (see “Demographic and Sociological Correlations of Youth Unemployment in Brunei Darussalam (2018)” below);
• Evaluate the effectiveness of current policy measures in addressing youth unemployment, determine the gaps, and suggest areas for improvement;
• Evaluate the potential of economic cluster development in employment creation to provide a picture of Brunei’s future economy;
• Apply foresight analysis to identify economic and job futures scenarios, in terms of employment and working patterns as well as future types of jobs and related manpower policy issues (see “Scenario Development for Job Futures Brunei Darussalam 2040 (2018)” below);
• Develop a quantitative model to provide long-term manpower projections required to achieve the preferred future economic scenario, taking into account skills and qualifications, as well as analyse potential imbalances between supply and demand (see “Brunei Darussalam Labour Market Projections 2020-2050: Towards Achieving a High Quality of Life (2018)” below);
• Create a set of 4 scenarios for Brunei based on two critical uncertainties – the extent to which 4IR technologies act as a substitute for or a complement to human labour, and the extent to which ASEAN member countries are able to pull together in the face of global challenges.

Scenario Development for Job Futures Brunei Darussalam 2040 (2018)

This study is based on a scenario development exercise to identify economic and job futures possibilities, in terms of employment and working patterns as well as future types of jobs and related manpower policy issues. Mindset and mentality change at all levels, 4IR/future ready skills and education, economic competitiveness and extreme 4IR acceleration are the critical issues which was identified and treated as key driving forces in shaping Brunei’s job futures 2040.

Based on the identified emerging issues, trends, and key driving forces, four economic scenarios for Brunei 2040 were formulated. Scenario 1 is a continuity and growth scenario and is Brunei’s default future. Scenario 2 is a continuity and collapse scenario. Scenario 3 is a transformation and failure scenario. Lastly, scenario 4 is a transformation and growth scenario.

From these economic scenarios, an extensive list of potential jobs was mapped out and categorized into 3 categories: 1) declining jobs; 2) sustainable jobs; and 3) future jobs which together form the CSPS Job Prism Model. STEM related jobs and jobs that require key human skills such as critical thinking, creativity, and complex problem solving were seen as most likely to be stable and grow in the future.

Brunei Darussalam Labour Market Projections 2020-2050: Towards Achieving a High Quality of Life (2018)

Understanding labour market needs and skills matching is an important policy agenda. It helps to inform the workforce, education and training institutions, and policymakers on the anticipated changing skills needs so that all participants can prepare or plan for the future. Thus, the aim of this study is not to make precise manpower predictions, but to provide a systematic and quantitative labour market evaluation based on different scenarios of the future.

The local labour supply is projected to grow from 166,700 to a range of 202,100 – 209,900 (21-26% cumulative growth) between 2019 and 2050 due to higher life expectancy and increased labour force participation, especially among women. The local labour demand is projected to grow from 206,900 to a range of 232,300 – 253,300 (12-22% cumulative growth). Growth in the number of jobs is mostly concentrated among high- and medium-skilled occupations.

The local unemployment rate is projected to decline under most future scenarios, with the pace moving in step with educational improvements and better skills matching.

In terms of quality of life, Brunei is projected to remain in the world’s top 10 economies in terms of per capita GDP if there is sustained economic growth.

Demographic and Sociological Correlations of Youth Unemployment in Brunei Darussalam (2018)

This study identifies demographic and sociological variables that are significantly correlated with various measures of unemployment using data from the CSPS 2019 national survey.

Several demographic and sociological variables were found to be significantly correlated with the traditional measure of unemployment. These variables include ethnicity, marital status, household income, number of occupants per bedroom, and housing scheme, district of residence, and age. Gender is not significantly correlated with any of the unemployment measures.

With regards to education, the number of years since graduation is significantly correlated with unemployment as well as the number of o level credits, the highest level of education attained, and the subject area chosen (for those with a diploma and above).

In terms of their level of development as measured by the Youth Development Index (YDI), the overall index is significantly correlated with the traditional measure of unemployment where those in the bottom quartile have a higher propensity to be unemployed.

This study assesses a proposal by the Ministry of Education (MOE) to have its education loans means-tested for eligibility and to propose alternative options based on international best practices.

Several gaps in the proposal are identified. The study recommends three options to address these issues as well as to provide MOE with added advantages including cost savings, reduced administrative burden, and assurance that the education loans are eligible for all but still targeted towards the less financially-able households.

This study is the first to examine future demographic challenges that are likely to impact Brunei's socioeconomic development towards the achievement of Wawasan Brunei 2035 goals.

Among the key policy recommendations are: (i) increase Brunei’s population to at least one million to achieve economies of scale, scope, and sectoral redeployment; (ii) stimulate population growth through financial and structural incentives, such as increasing the fertility rate and attracting foreign workers; (iii) increase human resource development in the private sector; and (iv) provide stronger incentives to develop manpower and raise productivity.

This is the first national study that focuses on unemployment among university graduates in Brunei, through a survey of more than 800 graduates.

Key findings suggest that several characteristics, such as the field of study, university ranking, and demographics, have an impact on the probability of unemployment. Graduates in arts and humanities were more likely to be unemployed compared to those in education and ICT, which may reflect prevailing market demand. Graduates from the top 300 university rankings were more likely to be employed compared to those from local institutions. Graduates who were younger, female, and married also had a higher probability of being unemployed.

Among the policy recommendations include adopting active labour market policies (ALMPs), enhancing the quality and reputation of local universities, and improving labour market data collection that are required for an evidence-based approach to education and labour market policies.

The Government has recently implemented several ALMPs, such as the i-Ready apprenticeship program and JobCentre Brunei, and local universities have made big strides in improving their global rankings.

This pioneering study calls for policy attention on unemployment amongst early school leavers who lacked employability, which was not seen as a serious policy issue then.

The study finds a high mismatch between the available skills and the desired employment of registered jobseekers, who were typically early school leavers with low education attainment (2-3 ‘O’ Levels) and were interested in clerical and white-collar office jobs in the public sector. The private sector was seen as unattractive, given the high reservation wage of locals. The policy implications emphasised the need to address skills mismatch and mindset change.