If Thailand's income per capita reaches US$15,000 in 2035 (up from $6,900 in 2017), it will have escaped the "middle-income trap" -- the term economists use to describe what happens to a country when its growth slows after reaching middle-income levels.
To make this happen, the priority for Thailand is to increase the nation's productive capacity and focus on human resources by raising the level of its skilled labour.
However, over the past 10 years, Thailand has relied on low- and medium-skilled labour, which together account for around 84% of total employment. Technician-level and professional workers make up the remaining 16%. In developed countries, the high-skilled workforce is around 60-70% of total employment.
Why has Thailand remained a production base for low value-added products? The answer is its failure to distribute the benefits of development to the countryside where most Thai people live. Some 14 million people work in agriculture, having to deal with falling and fluctuating prices for their produce as well as unpredictable weather. As a result, labour productivity in the agricultural sector is the economy's lowest and has changed very little over the past decade.
Thailand's best labour productivity is in the industrial sector, which employs around 8 million workers, followed by the service sector which employs more than 17 million. If the country wants to improve labour productivity, it is the industrial sector, which has been at the centre of the country's development goals for decades, that is the priority. Studies have shown that productivity in the sector increased more than 30% in the past 10 years from 2008.
The same studies found that manpower in industry, which has been the sector in the country's development goal for decades, in which value added increased by an average of 4% per year. At the same time employment in industry rose to 87,000 at an average rate of increase of 1.2% per year, lower than the value-added rate. This confirms that labour productivity has improved. However, if we look at the quality of labour, we see that the low- to medium-skilled category actually increased slightly from 84.3% in 2007 to 85.4% in 2017.
While those with so-called Por Wor Chor vocational certificates and Por Wor Sor vocational diplomas increased from 9.5% of the workforce in 2007 to 11.9% in 2017, that remains a small share of the workforce in the industrial sector.
At the same time, the share of manpower with vocational qualifications in the industrial sector gradually increased, but at a slower rate than this government's expectation. The Thai government is promoting the idea that "vocation creates the nation" under the Eastern Economic Corridor (EEC) Development Plan, part of Thailand 4.0 aimed at revitalising and enhancing the well-known Eastern Seaboard development programme that has underpinned Thailand's status as an industrial powerhouse for more than three decades.
The EEC development framework estimates the plan will need 173,705 people with vocational qualifications. But the country is still 55,642 (or 32%) short of that number.
The study "Vocational Education in Thailand: Its Evolution, Strengths, Limitations, and Blueprint for the Future", conducted by myself and Wanwisa Suebnusorn, a researcher at the Thailand Development Research Institute, found problems in both state and private colleges at which around a million students were pursuing vocational qualifications. The problems are poor quality of applicants, poor quality and inexperienced teachers, out-of-date curriculums that were mostly not competency-based, and obsolete equipment. These problems need to be sorted out quickly.
I have visited many polytechnic colleges in China and came up with the following thoughts. College administrations may have to change policy, providing scholarships to academically well-performing students who do not have the financial resources to attend college as well as those who want to study for diplomas or high vocational level qualifications in subjects with high demand in the market.
Another idea is for local colleges to work together with the private sector, subsidising fees and accommodation for 18-year-olds who already have vocational certificates and want to study for higher qualifications at the same time as they are working. They would be offered job guarantees with salaries equivalent to those with bachelor's degrees.
Meanwhile, a thousand teachers with technical skills will retire in the next five years. They need to be replaced by better-quality trainers over the next two years, assisted by Chinese polytechnics under Beijing's "Belt and Road" initiatives. Institutions should be able to recruit good graduates from vocational education colleges nationwide. This could result in enough new teachers to replace those that are retiring.
Also, teachers should be given the chance to enhance their knowledge in all subjects related to EEC development and Thailand's Industry 4.0. At the same time, all courses should be changed to competency-based curricula by applying the standards issued by the Thailand Professional Qualifications Institute (Public Organisation) and/or the Department of Skills Development in order to meet the demands of the labour market. Curricula also need to be updated.
One distinctive point about Chinese polytechnic education is that their modern equipment provides the basis for everyone to have proper training. Meanwhile, Thailand's Vocational Education Commission should accelerate the building of a central laboratory to provide a model for comprehensive skills training. If the commission does not want to build brand-new laboratories, it could renovate existing ones so that there is at least one laboratory for each college. And if the budget is a problem, perhaps it could borrow from countries investing in Thailand, such as Japan, South Korea or China, to improve the quality and capacity of at least 300 teachers of technical subjects per year.
The Thai government should also guarantee loans from foreign governments such as Japan which has provided financing for improving vocational education several times. Or at least, the Vocational Education Commission might access China's grant assistance programme for Asean nations at least for two years. That is better than doing nothing.
A good example is cooperation between Thai technical colleges and Chinese polytechnic colleges to create joint curricula. This allowed Thai upper vocational students to study in Chinese colleges for a year, learning about how to use modern equipment in information technology, animation, movies, train maintenance, driving high-speed trains, aircraft maintenance, as well as building and piloting drones.
In future, Chinese institutions might be willing to continue with the programme, offering to sponsor accommodation, with Thai students responsible for travel costs only. Thai students who completed the programme with both Thai and Chinese certificates (co-certificate) have been offered jobs in both Chinese and Thai firms with better salaries than they can normally get in Thailand.
Such Thai-Chinese cooperation provides an example for those in Thailand's Education Ministry to see how the world knows and cares about the fact that vocational education can "build the nation".
Policy analyses from the TDRI appear in the Bangkok Post on alternate Wednesdays.