Gov’t Looks to Private Sector to Train Workforce

For Jitu Manghnani, country manager of Tata International, finding quality Cambodian graduates to work at the multinational trading and distribution firm is a struggle.

“Unfortunately the freshers that come into the system, and we have large numbers of them now actually, most of them come extremely, well, fresh,” he said.

“They don’t have any knowledge of business, and any knowledge they do have is [from] textbooks, and that part of it is extremely ancient.”

His is a lament echoed widely and often by businesspeople in the country.

Mr. Manghnani was speaking this week on the sidelines of a symposium in Phnom Penh organized by the Development Research Forum of Cambodia, where key players from the public and private sector gathered to figure out how to gear the education system toward meeting changing labor market needs.

But that is no small task.

According to a report released by the World Bank in May, a survey of Cambodian employers found that 76 believed new graduates are not equipped with the right set of skills. And in April, the Asian Development Bank pinpointed a lack of skilled labor as the greatest obstacle to economic growth in the country.

Nos Sles, an undersecretary of state at the Ministry of Education, said the government recognized concerns over education standards and that too few young people are choosing to pursue degrees in technical subjects such as engineering and sciences.

“The current state of the Cambodian labor market is characterized by a low number of skilled workers and a mismatch between industry’s needs and the skills and the competency of graduates,” he said in a speech at the symposium.

The Ministry of Education has laid out a series of reform priorities since last year’s election to address the skills gap and plan to tackle the issue at every stage of the education process.

The most visible change to date has been the overhaul of the grade 12 national exams to stamp out cheating and bribery, a move that saw a 25 percent pass rate this year, down from 86 percent in 2013. But work is also underway to re-establish technical training centers in all 24 provinces and introduce career counseling in schools.

However, speaking to reporters following his address, Mr. Sles said the Education Ministry lacked sufficient funds to pay for the far-reaching reforms, adding that he could not estimate just how much money might be needed.

Last year, Ministry of Education Secretary of State Nath Bunroeun complained that the government devoted less than 2 percent of the country’s gross domestic product to education, arguing that this figure should be closer to 4 or 6

But during a speech at this week’s symposium, Labor Ministry spokesman Heng Sour suggested that the private sector should pick up the slack. As the greatest beneficiaries of a capable, skilled workforce, Mr. Sour argued, they should also be prepared to invest in the system that prepares their staff.

“I agree that the government must take responsibility to produce skilled workers…but it is also [in] the interest of the private sector to acknowledge that if they invest a dollar in a skilled worker or in productivity improvement, the return on their investment is higher,” he said.

“So why does the government sector still need to stick to the classic principle that lets government alone do [this]?” he asked the audience of mostly business representatives.

“And why don’t you consider to find a way to move up the productivity of the workers already existing in your enterprise?”

Sandra D’Amico, managing director of human resources firm HRINC, agreed that both public and private sector players needed to contribute to creating a competitive workforce and economy.

However, she emphasized that investment in the early stages of a child’s life, from the health of mothers during pregnancy through to secondary education—areas typically the responsibility of governments—were of paramount importance.

“It is at primary and secondary school that young people will gain the foundation of knowledge and interpersonal skills that will carry them through life,” Ms. D’Amico said in a speech.

“Primary and secondary schooling must be a policy priority which, if not, will hamper the future competitiveness of Cambodia.”

Systemic problems with education means that even major firms like ANZ Royal Bank—well placed to attract the top applicants—are unable to find graduates that meet their standards.

David Sok Dara Marshall, head of corporate and institutional banking at ANZ Royal, said the company spent “millions and millions of dollars a year” training its employees in not only technical skills but also so-called soft skills and critical thinking.

Mr. Marshall warned that failing to enhance Cambodia’s workforce soon could be disastrous, because although the country is currently attracting investors due to cheap labor, this was likely to shift “significantly” in the next three to five years

“Labor costs are going to become increasingly more expensive but electricity has not come down and transport and infrastructure has not improved,” he told the symposium.

Tata International’s Mr. Manghnani, who is also a member of the government’s subcommittee on education, said that only a handful of mostly multinational firms were investing in their employees.

“As Sandra [D’Amico] very rightly pointed out, SMEs [small and medium enterprises] are the ones that need to start taking up these initiatives, because most people don’t land jobs at international companies or with reputable local companies, they mostly end up in the SME sector because that’s where the jobs are,” he said.

“So I guess training needs to start at a much wider level now, at the SME level,” he added. “SMEs are the biggest challenge in this context.”

However, Mom Pet, a project officer for the Federation of Associations for SMEs of Cambodia (FASMEC), said most of the organization’s members provided their staff with on-the-job training.

“Although we sometimes cannot provide extensive long-term training, we have tried all methods to provide short-term training for staff and members of FASMEC,” he said by telephone.

Mr. Pet said smaller companies should make greater efforts to partner with universities to equip students with the skills they need to enter the world of business.

“So far, we have worked with two universities,” he said.

“It means that whenever we need applicants, we will send proposals to universities to improve training for students before they graduate.”

But Son Chhay, chief whip for the opposition CNRP, said the government was simply trying to deflect its responsibilities by calling on the private sector to invest more in education and training.

“Compared to a number of countries in Asean, including neighboring countries like Thailand and Indonesia, their budgets for education are over 20 percent, Cambodia’s budget for education is still so low, as low as about 13 percent,” Mr. Chhay said.

“So the government has not put enough effort into helping educate our children,” he added. “So it is not appropriate to just talk about the private sector.”

(Additional reporting by Kuch Naren)

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