The Asia-Pacific Economic Cooperation (APEC) is a regional grouping of 21 economies situated within the Pacific Rim. Its fundamental objective is the liberalization and facilitation of trade and investment aim at accelerating economic growth and development among member economies. APEC ascribed to the idea that human resource development is fundamental to economic development. Without adequate human resources, the opportunities offered by trade and investment liberalization would diminished considerably. It was no less than former President Fidel V. Ramos who advance the idea that the greatest economic resource of APEC is its people.
APEC believes that skill shortages can constrain the expansion of output in the short-term and limit the possibility of diversifying productive structure in the long-term. APEC member economies expressed concern that the growth and development opportunities afforded by liberalization may be jeopardized by the gap between the skills needed by industry and the output of educational and training institutions.
In view of this, APEC spearheaded a study in 2001 focused on Multinational Corporations in selected economies. The research aimed to assess the nature and extent of skill shortages and training needs in eight selected APEC economies by focusing on the experiences of multinational corporations in four industries--manufacturing, banking and finance, insurance and business services. The MNCs were chosen as they can benchmark the skills of their workers against international standards with other MNCS.
KEY STUDY FINDINGS
The Philippine country paper that contains the results fo the survey highlights the following:
EXTENT OF SKILL SHORTAGES AND DEFICIENCIES
The survey utilized a number of variables to indicate the nature and extent of skill shortages faced by MNCs, namely: (1) perceived hurdles in recruiting personnel; (2) the extent of the use of subcontracting; and (3) the time required to recruit IT personnel. Skills deficiencies can be gleaned from the specific skills identified that would be needing improvement.
Skill Shortages. Firms were found out to experience recruitment difficulties for managers and professionals than recruiting clerical, sales, services and production personnel. The study results showed that looking for non-technical workers is simpler as they can be easily trained even if they are skills deficient upon entry. Recruitment for technical positions is another case as there are minimum levels of competencies required of the workers at the time of job entry. Hence firms tend to exercise greater selectivity.
The MNCs reported that they find it difficult to fill up technical positions especially in the field of IT. Dearth in the supply of communication and computer technicians, electronic and maintenance engineers/technicians and network technicians are common among surveyed MNCs as it takes them 4 to 7 weeks to fill up this technical positions. Supply of IT personnel is also wanting as it takes MNCs 12 to 15 weeks before finding out qualified applicants for the positions of project managers, program designers, system consultants and system analysts. This positions generally require experience, leadership and communication skills aside from technical proficiency.
This illustrates the "brain drain" the country is experiencing as the more capable and talented ones are being lured by the glitter of overseas employment.
Skills Deficiencies. Most of the MNCs indicated that the skills of their workers that needs to be improved pertained to:
In contrast, MNCs expressed satisfaction with the level of literacy and numeracy skills of Filipino workers.
HOW MNCs ARE COPING?
There are several ways by which MNCs deal with the problems of skill deficiencies and shortages. The most common ones are expatriation, recruitment, job outsourcing and training.
CONCLUSIONS AND POLICY RECOMMENDATIONS
The results of the survey showed that there are skills bottleneck in the supply of managerial, professional and technical labor. Abundant stock of production workers remains the country's comparative advantage. It also showed that the skill shortages reflect the existing mismatch between supply and demand in the production sector. This is well exemplified in the case of IT manpower where the huge turn out of graduates has failed to stem the growing shortage of qualified IT personnel.
Intensifying firm-level training should be encouraged to generate the right kind of skills required by companies. However, reforms should be instituted in the educational system as firm-level training cannot constitute for quality education. Firms are not expected to hone the workers' generic skills that should been developed by the educational system. Likewise, there are limits to which MNCs can be made to invest in human resource development. The study suggested that improving the quality of education is more compelling in resolving the twin malaise of unemployment and skill shortages than broadening education access at quality's expense.