SINGAPORE: The Internet economy is set to create 1.7 million full-time jobs in Southeast Asia by 2025, three times the number in 2018.
This is according to research findings commissioned by Google and Temasek which were released on Monday (Nov 19).
The jobs will be created to cope with the projected growth in e-commerce logistics, as well as in ride-hailing and food delivery services, the study said.
The value of Southeast Asia’s Internet economy is expected to exceed US$240 billion by 2025, a fifth more than previously estimated, the Google-Temasek research found.
It estimated that the gross merchandise value (GMV) of the region’s Internet economy reached US$72 billion in 2018, rising 37 per cent from the year earlier.
The GMV for e-commerce alone in the region will exceed US$23 billion this year, the report said.
The study, first published in 2016, encompasses ride-hailing, e-commerce, online travel and online media.
The latest report adds new sectors such as online food delivery, as well as subscription music and video on demand.
The increasing number of jobs is in line with the growth of the Internet economy in Southeast Asia as the survey projected that it is set to surpass the previous estimate of US$200 billion by 2025.
The total number of partners employed, such as part-time workers and freelancers leveraging the Internet for employment, will also jump to 12 million up from the current four million.
The research also attributes the projected increase in jobs to flexible work arrangements and the opportunities for a supplementary income.
200,000 HIGHLY SKILLED JOBS
Of the 1.7 million jobs, about 200,000 highly skilled jobs will also be created by 2025 as companies continue to grow their core business and expand into new areas.
The research also stated that the growth of skilled jobs is now at a rate of 10 per cent per year.
This is significantly faster than the employment growth in the rest of the economy, which is averaging 1 to 3 per cent per year in most Southeast Asian countries.
Internet economy companies employ highly skilled professionals in functions like software engineering, digital marketing, data science and product marketing among others.
These jobs often command salaries three to five times higher than median wages in Southeast Asian countries, the research found.
WORLD’S MOST ENGAGED INTERNET USERS
The Google-Temasek research also found that there are more than 350 million Internet users across Indonesia, Malaysia, Philippines, Singapore, Thailand and Vietnam as of June 2018 – 90 million more than in 2015.
This makes Southeast Asians the most engaged Internet users in the world.
According to the research, more than 90 per cent of them connect to the Internet primarily through their smartphones.
The research attributes the rapid growth of users to the increasing availability of affordable smartphones, and the roll-out of faster and more reliable mobile telecommunication services.
Of the six Southeast Asian countries covered in the research, Vietnam currently has the most developed Internet economy for value of merchandise sold in 2018, standing at four per cent of its gross domestic product.
Singapore comes in second at 3.2 per cent.
The current total capital raised for the Internet economy in Southeast Asia adds up to US$24 billion since 2015, progressing ahead of schedule towards the goal of attracting US$40 to US$50 billion worth of investments that they estimated would be required to build the Internet economy by 2025.
Most of the investments went to ride-hailing and e-commerce at about US$20 billion, or 80 per cent of the total capital raised, since 2016.
A record US$9.1 billion was raised in the first half of 2018.
The research also found that more startups are also getting early-stage funding.
In the first half of 2018, Southeast Asia recorded 580 Seed and Series A deals, compared to 285 in the same period of 2017.
Seed and Series A deals typically involve startups that are valued at less than US$100 million, which are planting seeds for the future growth of the Internet economy ecosystem.
There were 61 Series B and Series C rounds, which targets companies valued from less than US$100 million to several hundred million dollars that have proven business models and growth ambitions.
In both cases, there were nearly as many deals in the first half of 2018 compared to all of 2017, bringing the total number of deals in the region to almost 2,400 since 2016.