Burma’s Skills Sector in the Spotlight

By Kyaw Hsu Mon 25 June 2015

RANGOON — Sources in domestic business circles have welcomed a recent call for British companies to consider investing in Burma’s skills sector, with the UK Trade and Investment (UKTI) office saying a dearth of qualified workers could be remedied, in part, by British education and training enterprises.

According to a UN-backed business survey last year, a skills gap in Burma was the second most severe barrier to progress after corruption, and a UKTI report this month said policy liberalization and attendant economic growth of recent years has seen opportunities go unrealized as the workforce has failed to meet the needs of an expanding pool of jobs.

Maung Aung, an economist with the Ministry of Commerce, said the UKTI report painted an accurate picture of the challenges many businesses in Burma face; namely, a shortage of skilled labor.

“For example, in the garment industry, the [low-skill] labor supply is adequate, but skilled laborers are very rare to find. That’s why if we compare to other countries, minimum wages are lower [in Burma],” he said.

“It concerns not only the garment sector; almost every sector in Burma is facing this issue,” Maung Aung said.

“Burma has the advantage of a large workforce of over 30 million people, of which 40 percent are between the ages of 15 and 29,” the report said. “The majority of the workforce, however, is under-skilled and under-educated.”

The report said “recent research highlighted inexperienced trainers, out-dated facilities and minimal processes to align standards with demand.” Current education and training providers in Burma most commonly offered courses in languages, ICT and business, researchers found.

Burma’s education system was decimated under five decades of military dictatorship, which gave way to the quasi-civilian administration of President Thein Sein in 2011. The result: While many people may hold post-secondary degrees, often that is not enough to meet the needs of the job market, where an influx of foreign investment has created jobs requiring skills that Burma’s neglected education system has been unable to adequately provide for decades.

“Most young people are not qualified,” Maung Aung said. “I don’t mean all, and it’s not about degrees, it’s about how can they work for their professionals. Here most workers are learning by doing, they just rely on on-the-job trainings,” he said.

“When many international firms come here, the major challenge for them is human resources,” Maung Aung said.

Soe Thein, executive director of the Asia Green Development Bank, said finding employees in the banking sector, like many segments of the services industry, was one of the major problems facing the country’s economy.

“Many foreign banks are coming, qualified laborers are needed there, as well as many local banks are expanding, that’s why this problem is an important issue for us,” he said.

“To sustain businesses, HR trainings and development trainings are essential for us,” he added.

Given the labor market picture painted in the report, the UKTI invited British businesses to invest in skills sector enterprises in Burma.

Lisa Weedon, director of UKTI Burma, said in a statement: “Many British training providers are already active in the Asean region and I hope this report will encourage them to look at the very real opportunities that Burma offers.

“I believe that British companies have an important role to play in helping Burma up skill its young and ambitious workforce and I hope to see many more of them here in the future,” she said.

The report identifies manufacturing, infrastructure and energy, financial services and ICT as key sectors of opportunity, and notes a need for core business skills in all sectors of the economy.

Maung Aung said he welcomed British investors to assist Burma’s education sector, but suggested that the limitations of the market, in particular consumers’ purchasing power, be a priority of their business plans.

“Trainings and schools should consider [affordability] for people, so that participation can be inclusive,” he said.