Labour shortage, not hike in wage, the bigger issue, says TDRI

The country is not running out of a working population, but still faces a labour shortage, said Srawooth Paitoonpong, senior researcher at TDRI.

Shortage of low-skilled labour is a problem as many of those who finish primary or lower-secondary school choose to pursue further studies and only a few of them enter the job market.

The reason is that they believe higher education will help them to get a higher income.

However, those with higher education, including university graduates, often find that their qualifications do not match market demand and cannot find jobs, he said.

He blamed political parties for not looking at the bigger issue and instead trying to woo voters by promising to hike minimum wages.

According to a survey in 2008, the number of employed labourers who had finished primary or lower-secondary school totalled 27 million, about 72.3 per cent of the country's total workforce.

However, the number of workers freshly entering the market was only 20,000 to 30,000 annually, he said. The rest were pursuing higher studies.

This shortage of unskilled labour is being resolved by using migrant labour from other Asean countries.

Srawooth raised the issue of the country's ageing population and said fewer new entrants in the job market also contributed to the labour shortage.

Those who finished upper-secondary school (mor plaiy) and primary vocational school (por vor chor) also mostly pursue higher studies, 88 per cent of 306,000 and 70 per cent of 163,000, respectively.

From this group, 73,000 entered the labour market while 47,000 ended up being jobless. The survey showed there were 30,000 job vacancies for those with vocational education.

Currently, the market employs 3.7 million of those have finished high school and 1.8 million of those from vocational schools.

Holders of bachelor's degrees in 2008 numbered about 304,000, with 24 per cent of them pursuing higher studies and 207,000 entering the job market. Currently, the market employs 3.65 million of them, and 460,000 million of those obtaining master's degrees.

According to a survey in 2008, the market needed 46,000 labourers but experienced a shortfall of 29,000 while the jobless number was 114,800. The high number of unemployed was due to a mismatch between worker qualifications and market demand. In the same year, the market demanded 656 with a master's degree, while there was a shortage of 341, and the number of jobless was 4,000.

Those who finish lower or upper vocational schools in engineering, business administration, computer and services, hardly find jobs, while university graduates in almost all faculties face high risk of joblessness, he said.

He proposed that teachers should have information about the job market and advise students accordingly. He added that the job market was not static and teachers must update their information.

He suggested that industries should upgrade production and services and hire labourers with higher education, as textile industries in China are trying to do.

Labour shortage was also caused by inefficient methods of recruitment among small and medium-sized enterprises that used only signboards to advertise for new recruits at their factories.

An ageing Thai population and lower birth rates have also contributed to the labour shortage, he said.