Electronics workforce: Skill upgrade + English needed

Electronics industry with exports of 1.6 trillion baht & 200,000 employees, could shrink 50% in 3 years without educational & skill improvements.

In photo above Prime Minister Yingluck Shinawatra addresses the Asean Economic Community 2015 forum at the Queen Sirikit National Convention Center yesterday. Businessmen warned Thailand has lost its competitiveness in skilled human resources. In addition, the minimum wage hike to 300 baht per day in April has made Thai wages uncompetitive with Malaysia. (Photo: Kosol Nakachol).

Click button to listen to Electronics Exodus to download

Economics

Thailand faces electronic exodus

Could lose half its positions in 3 years
12/06/2012
Nareerat Wiriyapong

Thailand risks losing its status as an electrical and electronics manufacturing hub in Asean and losing half the sector's employment, some 100,000 jobs over the next three years, if it doesn't improve its skilled labour.

Sampan Silapanad, president of the Electronics and Computer Employers' Association, said Thailand has lost its competitiveness in skilled human resources. In addition, the minimum wage hike to 300 baht per day in April has made Thai wages uncompetitive with Malaysia.

"Thailand has been caught between low and high-end production, unable to move either up or down the value chain," he told a forum on the Asean Economic Community (AEC) co-hosted by the Thailand Management Association yesterday.

"Thailand can no longer rely on cheap labour and we must upgrade to high value-added production. However a major obstacle is many of our workforce cannot speak English," he added.

With total export value of 1.6 trillion baht, the electronics and electrical industry employs 200,000 people. The headcount could dip by half over the next three years, noted Mr Sampan, also vice-president of Western Digital (Thailand). 

The Commerce Ministry said the sector's exports edged up by only 0.8% last year, versus growth of 25.7% in 2010, to US$53.95 billion due mainly to severe floods. While shipments of electrical appliances expanded by 8.5% to $22.3 billion, electronics exports fell 4% to $31.64 billion.

The majority of the association's members have relocated some manufacturing activities to other countries due to the floods late last year and have not moved back to Thailand.

"Although we heard a guarantee there will be not be another flood this year, no information is available to make manufacturers confident about this claim," said Mr Sampan.

Pongsak Assakul, president of the Thai Textile Manufacturing Association (TMA), said Asean's top textile mills and garment factories formed an alliance to offer a full package of services to global customers.

Under the agreement, Thailand and Indonesia will supply upstream materials such as fabric to lower-cost Cambodia, Laos, Myanmar, and Vietnam to do final production for export outside Asean.

The alliance aims to increase Asean's share in the global textile and garment market from 6% at present. China dominates at 50% and Thailand has a 1.6% share.

Some 22 factories in Asean are participating, including six in Thailand and eight from Indonesia, he said.

Pongkarn Hongskul, senior marketing manager at Tata Steel (Thailand), said Thailand has a geographical competitive disadvantage to cash in on the growing demand for building materials in neighbouring countries. Collaborations with other Asean members in areas such as upstream material sourcing need to be developed to serve regional integration by 2015.

In a separate development, Thailand dropped to 30th from 27th in a ranking of 59 countries in IMD International's World Competitiveness Scoreboard 2012. Among Asian countries, Thailand ranked eighth, ahead of India, Indonesia and the Philippines.

Thailand scored very poorly in productivity and efficiency, which includes the industrial, agricultural and small business sectors. Thailand ranked 57th in this category.

Other areas where Thailand ranked poorly was technology, scientific advancements, and health and education infrastructures.

Thailand scored well in cost competitiveness, skilled workforce, open and positive attitudes and business-friendly environment.

(Source: Bangkok Post, Economics, Thailand faces electronic exodus, Could lose half its positions in 3 years, 12/06/2012, Nareerat Wiriyapong, link) 

National Competitiveness Vocabulary

competitiveness - how well a business can do compared to other firms (does it have lower price or higher quality?) การแข่งขัน (See Wikipedia)
lose competitiveness

national competitiveness - (See Wikipedia; See also work of Michael Porter and business clusters)
 
competitive (adjective) - involving competition มีการแข่งขัน
competitive advantage - something that helps you in a competition
disadvantage - something that makes someone or something less effective, successful or attractive ข้อเสียเปรียบ ข้อด้อย
competitive disadvantage - something that hurts you in a competition
geographical competitive disadvantage

value chain - the series of stages involved in the design, manufacture, marketing and support of a product, each stage adding features and value to the product before it is finally sold to the customer, idea popularized by Michael Porter (See Wikipedia)

move up the value chain - when an economy moves into higher value-added industries and economic activities such as computer hardware or software production, product design, rather than selling cheap labour for labour-intensive manufacturing, for example (See OECD paper)
move down the value chain  

upstream - at an early stage in the process of producing a product for sale (early in the supply chain)

upstream materials
supply upstream materials

sourcing - locating good companies to buy things from
upstream material sourcing

market share - the percentage of customers in a market that a company (or country or region) has as its own (See Wikipedia)
increase Asean's share in the global textile and garment market

fabric - cloth, the material used to make clothes
textile - a type of cloth or fabric that is woven or knitted (See Wikipedia)
textile mills - a factory that makes cloth and fabric used to make clothes and other things

garment - clothes
garment factories - factories that make clothes

Asean Economic Community (AEC) - the plans for zero tariffs and free trade between Asean countries and free flow of labour starting in 2015

integration - the process of combining with others to create a single unit or system การรวมเข้าด้วยกัน, การผสมผสาน
regional integration - when the countries in a region work together more closely

electronics - includes goods, such as CD players, televisions and high-tech machines used in factories and laboritories (See Wikipedia)
electrical appliances - machines that use electricity used in homes or factories  

forum - a place where people discuss and debate issues and express their ideas and opinions การประชุมแสดงความคิดเห็น

resources - things such as money, workers and equipment that can be used to help achieve goals ทรัพยากร ทรัพยากรที่มีอยู่
human resources - all the employees in a company and their skills

wage - an amount of money that you earn for working, usually according to how many hours or days you work each week or month ค่าจ้าง
exodus - when a large number of people (or organizations here) leave a place

Thailand faces electronic exodus

position - a paid job working at a company (being an employee of a company)

could lose half its positions in 3 years

status - the situation at a particular time; the state of affairs at a particular time สถานะ
lose status

risk losing status - the danger and possibility of losing your status in the future

hub - the central or main part of something where there is most activity จุดศูนย์กลาง
a manufacturing hub

electrical and electronics manufacturing hub in Asean
its status as electrical and electronics manufacturing hub in Asean

employment - when a person has a paid job
losing half the sector's employment

improve - to make better ทำให้ดีขึ้น
improve skilled labour.

Thailand risks losing its status as electrical and electronics manufacturing hub in Asean and losing half the sector's employment, some 100,000 jobs over the next three years, if it doesn't improve its skilled labour.

human resources - all the employees in a company and their skills
skilled human resources

minimum wage - the smallest amoung of money that an employer can legally pay a worker for their work
minimum wage hike - an increase in the minimum wage (increase in the lowest amount that can be paid workers for their work) 

Sampan Silapanad, president of the Electronics and Computer Employers' Association, said Thailand has lost its competitiveness in skilled human resources. In addition, the minimum wage hike to 300 baht per day in April has made Thai wages uncompetitive with Malaysia. "Thailand has been caught between low and high-end production, unable to move either up and down the value chain," he told a forum on the Asean Economic Community (AEC) co-hosted by the Thailand Management Association yesterday.

upgrade - improve; make new, modern, and up-to-date
high-value added production

obstacle - a difficulty or problem that prevents you from achieving something อุปสรรค ขวากหนาม an object that you must move or go around in order to move forward อุปสรรค, สิ่งกีดขวาง
major obstacle

workforce - all the people in an area or country available for work, all the people who work for a company แรงงาน

"Thailand can no longer rely on cheap labour and we must upgrade to high value-added production. However a major obstacle is many of our workforce cannot speak English," he added.

headcount - number of people working for a company or organization (or participating in some activity)
dip - decrease, fall
the headcount could dip by half - the number of workers could fall by 50%

With total export value of 1.6 trillion baht, the electronics and electrical industry employs 200,000 people. The headcount could dip by half over the next three years, noted Mr Sampan, also vice-president of Western Digital (Thailand). 

edged up - increased by small amount
exports edged up
exports edged up by only 0.8% last year

severe - very serious and worrying ที่รุนแรง ที่น่าเป็นห่วง
severe floods

The Commerce Ministry said the sector's exports edged up by only 0.8% last year, versus growth of 25.7% in 2010, to US$53.95 billion due mainly to severe floods. While shipments of electrical appliances expanded by 8.5% to $22.3 billion, electronics exports fell 4% to $31.64 billion.

majority - most, more than 50%  ส่วนมาก  เสียงส่วนมาก
relocated - moved to a new place
relocate manufacturing activities

The majority of the association's members have relocated some manufacturing activities to other countries due to the floods late last year and have not moved back to Thailand.

guarantee - a promise that something will be done or will happen คำรับรอง, การประกัน (See glossary)

confident - being certain of your abilities or of having trust in people, plans, or the future มั่นใจ
claim - saying something is true without proving it yet
confident about a claim - be certain that something said is actually true

make manufacturers confident about this claim

"Although we heard a guarantee there will be not be another flood this year, no information is available to make manufacturers confident about this claim," said Mr Sampan.

alliance - a group of people, organisations, or countries who have united to work together to help each other and achieve goals สหพันธ์  พันธมิตร
form an alliance

services - บริการต่างๆ things produced in service industries, not a physical good that can be bought, a waitress and a cook in a restaurant provide a service, technically: a sequence of activities that does not result in ownership of the outcome (See Wikipedia on services and the goods and services continuum

package of services - a set of services that are sold together by a company
full package of services
offer a full package of services

global - throughout the world ทั่วโลก
global customers

Pongsak Assakul, president of the Thai Textile Manufacturing Association (TMA), said Asean's top textile mills and garment factories formed an alliance to offer a full package of services to global customers.

Under the agreement, Thailand and Indonesia will supply upstream materials such as fabric to lower-cost Cambodia, Laos, Myanmar, and Vietnam to do final production for export outside Asean.

dominates - control some industry or other activity; do more activity than all others

The alliance aims to increase Asean's share in the global textile and garment market from 6% at present. China dominates at 50% and Thailand has a 1.6% share. Some 22 factories in Asean are participating, including six in Thailand and eight from Indonesia, he said.

cash in on - use some opportunity that you have to gain something, advance, progress, benefit in some way
cash in on the growing demand - offer products and make a product by selling to the increasing number of people who want to buy it

building materials - things such as concrete wood, rock, sand, iron used to make buildings

collaborations - working together with others to achieve shared goals
collaborations with other Asean members

demand - the need and desire to buy goods and services by households and businesses
growing demand

Pongkarn Hongskul, senior marketing manager at Tata Steel (Thailand), said Thailand has a geographical competitive disadvantage to cash in on the growing demand for building materials in neighbouring countries. Collaborations with other Asean members in areas such as upstream material sourcing need to be developed to serve regional integration by 2015.

productivity - producing more for the same amount of resources (labour, capital, machines) การผลิตสินค้า
efficiency - waste little time, energy and resources in doing a task (minimize time, energy and resources in performing a task) (See glossary) การทำงานอย่างมีประสิทธิภาพ คุ้มค่าเวลาและใช้พลังงานหรือต้นทุนในการผลิตน้อย เพื่อให้ได้ผลผลิตมาก

category - a group of people or things that have similar qualities หมวดหมู่ ประเภท
ranked 57th in this category

open and positive attitudes
open - willing to try new things and ideas
positive attitude - hopeful and confident, or giving cause for hope and confidence ซึ่งมองในแง่ดี
business-friendly environment

In a separate development, Thailand dropped to 30th from 27th in a ranking of 59 countries in IMD International's World Competitiveness Scoreboard 2012. Among Asian countries, Thailand ranked eighth, ahead of India, Indonesia and the Philippines. Thailand scored very poorly in productivity and efficiency, which includes the industrial, agricultural and small business sectors. Thailand ranked 57th in this category.Other areas where Thailand ranked poorly was technology, scientific advancements, and health and education infrastructures. Thailand scored well in cost competitiveness, skilled workforce, open and positive attitudes and business-friendly environment.