Laos: More and Better Jobs – What is Needed?

LAOS EXPANDING EMPLOYMENT OPPORTUNITIES While agriculture will continue to be important to Laos, expanding the manufacturing and services sectors is crucial for offering workers better job opportunities and for promoting economic growth. 96,000 young people are available to join the workforce annually, in the next decade THE JOB SITUATION Too many workers in agriculture Few applicants interested in manufacturing jobs MANAGER NOW HIRING Few applicants for both low-skilled and high-skilled jobs in manufacturing and services, even if salaries are higher Firms recruiting for low-skilled work but didn't receive applicants 47% LAOS 19% VIETNAM 6% YUNNAN (CHINA) WHY IS IT HARD FOR MANUFACTURING AND SERVICES FIRMS TO RECRUIT? 12 6, 3 BiB Salaries aren't Thailand offers similar but better paid jobs Longer working hours significantly higher THE LACK OF WORKERS IN MANUFACTURING AND SERVICES POINTS TO DEEPER PROBLEMS %24 Lao is attracting investments mostly in hydropower and mining, which generate fewer jobs Investors aren't interested due to the poor investment climate, compared to other countries with similar labor costs Without new investment in machinery, productivity remains low. This makes it difficult for firms to offer better pay and conditions IMPROVING MANUFACTURING AND SERVICES IS AN URGENT PRIORITY Improve the investment climate by ensuring that laws and rules are followed, instead of doing business via "insider deals" Streamline and simplify business compliance Improve transparency in all state-public sector transactions to lessen risk and improve investor confidence Lower the costs of doing business Toward a better future Opening up more job opportunities beyond agriculture and natural Investing in manufacturing and services can lead to the availability of well-paying jobs Improving knowledge and skills so that workers can take up these jobs resources sectors For more information about the Lao PDR Development Report, please visit www.worldbank.org/laos WORLD BANK GROUP