A poorly trained workforce and a lack of skills have reduced Cambodia’s competitiveness to the point where urgent education reform is needed to attract investors, a new UN report says

Photo by: SOVANN PHILONG

The ICT sector is hindered by a lack of qualified workers, UN report says.

Cambodia must "urgently" reform its education system to improve workforce productivity and attract the investment needed for economic growth, a UN Development Programme (UNDP) study released Monday said.

"Increasing Cambodia's competitiveness is a necessity, not a choice, if the country is to sustain economic growth, reduce poverty and keep pace with its ASEAN neighbours," the report on Cambodia's competitiveness in the global economy said. "Reform in the education sector must be a priority if Cambodia is to create jobs and compete successfully in the global economy."

The study cited a World Economic Forum (WEF) report  ranking Cambodia 122nd out of 134 countries in the quality of primary education. Around 40 percent of Cambodians do not finish primary school.

The country did even worse in higher education and training, ranking 127th in the WEF Competitiveness Report 2008-09. Its ranking in both categories was the lowest of all ASEAN nations, though data from Laos and Myanmar were not available.

UNDP economist Brooks Evans said the study looked at the economy both sector by sector and in comparison to other countries. A lack of skills and a poorly trained workforce were among the most commonly cited constraints by businesses, he said, leading to labour being three times less productive than in Thailand. Vietnam has also opened up a lead on Cambodia in productivity after being at a similar point in 1993.

You must build the capacity of the people to attract businesses to these sectors.

The need for an "urgent overhaul" of human resource policy was a recurrent theme of the study, Evans said. "In terms of higher education and training, Cambodia is the biggest laggard in ASEAN. Cambodia has a serious lack of highly trained workers and this is something that requires urgent prioritisation."

In specific sectors, the report identified a low skill base among Cambodian construction workers and noted that engineers and architects were "overwhelmingly foreign".

In the ICT sector, competitiveness was hindered by the shortage of qualified ICT workers, which acted as a barrier to firm expansion.

In the garment sector, employers had addressed the skills challenge by training their own workers, but higher-wage management positions were still dominated by foreigners indicating a need for better management training.

"There is a very urgent need to train Cambodians to fill these positions," Evans said.

On the plus side, Cambodia scored well on labour market efficiency, which is a broad measure of the ease with which businesses can change their workforce, coming in 33rd on the WEF rankings.

Evans added that the study had been commissioned by the government to provide medium- to long-term policy options to enhance Cambodia's competitiveness but that the economic crisis had raised the stakes. "It is now imperative for these changes to be made," he said. "It is not a choice."

Starting point

The report set out four policy areas that require urgent attention across the economy, including more active government coordination with the private sector in human resource policy.

Among specific policies to boost skills it called for investment in vocational training courses for trade and professional degree courses, along with rationalisation and accreditation of the tertiary sector. Financial incentives needed to be established to direct students towards courses whose skills where in highest demand, and internship and apprenticeship schemes needed to be set up.

The report also called for specific training centres to be established to upgrade skills in textiles and tourism, two key pillar industries.

UNDP Country Director Jo Scheuer said the garment sector had done a good job addressing its skills needs in the absence of cross-sector training initiatives, and that those skills were transferable.

"People are not mono-skilled and they can re-adapt," he said. "But you must build the capacity of the people to attract businesses to these sectors. A more productive labour force is also a more flexible labour force with skills able to be applied across sectors."