Thailand
Lao workers under-represented in special economic zones
Only a third of the workers employed in special and specific economic zones (SEZs) are Lao, with a lack of skills being among the issues depriving local folk of job opportunities in industrial parks, a recent survey has revealed.
As many as 12 SEZs have been developed across the country, creating jobs for 24,982 Lao and foreign workers. But only one third or 8,951 jobs are held by Lao nationals.
There is a high demand for skilled workers to fill positions in the SEZs, but the recruitment of skilled Lao workers lags far behind the requirement, according to the survey conducted by the National Economic Research Institute (NERI).
“The number of skilled Lao workers recruited has been limited, especially during the construction of SEZs in the northern provinces,” the survey showed.
Most of those hired to carry out construction work in SEZs in the north were foreigners.
Large numbers of foreign workers are being hired at the Golden Triangle SEZ in Bokeo province and the Boten SEZ in Luang Namtha province.
There are several factors that make employers reluctant to hire Lao workers. These include language barriers, lack of professional skills, impatience, lack of discipline, and unwillingness.
The unattractive social welfare and wages offered to Lao workers also discourages them from applying for and staying in jobs.
The wages offered to Lao workers are lower than in neighbouring countries, according to the survey on the establishment and operation of SEZs. The World Bank suggested that labour productivity remains low in Laos. The median labour productivity (value added per worker) in Laos is US$4,600, which is 10 percent lower than in Cambodia and less than half that of Vietnam.
The highest performing firms in Laos lag far behind the most productive firms elsewhere in the region.
“The 10 percent most productive firms in the Lao PDR produce around US$20,967 per worker, compared to US$61,646 in Vietnam and US$93,378 in Cambodia,” the Bank said in its publication titled ‘Doing business in the Lao PDR : Constraints to Productivity’.
“Wages are low, but relatively high compared to worker production levels.”
Economists have suggested that the Lao government needs to do more to train and upgrade the skills of its workforce to tap the potential of the huge working age population.
The number of people of working age, i.e. those aged 15-44, is as much as 49.77 percent of the entire population of about 7 million. The junior population age from 0-14 years old to replace the current working-age group is as high as 32.05 percent.
NERI suggested that this demographic structure offers an opportunity for Laos to supply manpower to fulfill development needs in the food processing industry, real estate, tourism, agriculture, and services.
As of June this year, some 12 SEZs offering tax breaks had been established and were operating across the country. These have attracted 503 local and foreign companies with registered capital of more than US$8.4 billion.
Source: http://www.vientianetimes.org.la/freeContent/FreeConten_Lao_workers_257.php