The severe shortage of engineers in Thailand threatens the development of the Kingdom's automotive industry, according to the latest survey by Japan External Trade Organisation (Jetro).

"Thailand seems to have the most severe shortage of engineers, due to the establishment of the country as an R&D base by a series of automobile manufacturers," Jetro said in a regional survey released yesterday.

Overall, Japanese companies operating in Asean, China and India said, "The companies in the surveyed countries are in need of qualified engineers, mid-level managers, and Japanese-speaking employees. China and India have higher levels of engineers in their labour supply when compared to the Asean nations."

It added, "China, Vietnam and Thailand have too few workers in some areas."

Jetro recently conducted a survey on trends and issues regarding workforce development in Asia, in order to observe the strength of the investment environment in the region and encourage governments and authorities to improve the environment. Major observations in the survey are wage increases and personnel shortages. The companies surveyed also suggested authorities in Asia reduce workforce mismatches and promote sound investment environments.

Isamu Wakamatsu, senior economist for Jetro, said: "The study, titled 'Comparative Survey of the Labour Environment in Asean, China and India', was conducted with Japanese companies in Thailand, Malaysia, Indonesia, the Philippines, Vietnam, South China and India, from November 2005 to June 2006. The findings discuss three major trends that may affect daily operations: wage increases, personnel shortages and strict employment regulations."

China holds the dominant position for the number of people studying Japanese, but overall there are few personnel who speak Japanese in the Asean nations, as well as in India. Of all the Asean nations, Thailand enjoys a comparatively good supply of Japanese-speaking personnel, but the nation appears to be markedly deficient in interpreters and other similar personnel," said Wakamatsu.

"Concerns over wage increases received the highest response rate, chosen by approximately two-thirds of the surveyed companies," he said. "Those in Indonesia, Vietnam and India in particular showed high percentages - 85.8 per cent, 75.9 per cent and 72.1 per cent, respectively - with almost all companies expressing such a concern. Wage increases aside, the companies also found allowances such as lodging, security obligations and accompanying benefits to be issues of concern.

A Japanese company in Thailand said it could not recruit workers at the minimum wage and had to increase allowances, while one in the Philippines employed at the minimum wage without problems."

"The companies in the surveyed countries are in need of qualified engineers, mid-level managers and Japanese-speaking employees."

China and India have higher levels of engineers than Asean nations, while Thailand seems to have the most severe shortage of engineers, with insufficient personnel for its growing auto sector.

The study also discussed two ways to improve the investment environment and Japanese companies' operations.

"One, governments and related parties should cooperate more with business groups and learning institutions, to create human capital with the right skills for jobs, such as foreign-language ability and more practical skills, and help reduce staff mismatches and job-hopping. The authorities could also expand incentives such as tax privileges to promote in-house training for employees. Second, more transparent labour-related systems are needed with advances in economic integration in Asia," concluded Wakamatsu.