PHNOM PENH (Khmer Times) – The Garment Manufacturers Association of Cambodia yesterday broke ground on a new worker institute in the Phnom Penh Special Economic Zone, seeking to improve labor skills in the Kingdom.
The institute will train in skills from basic sewing to more advanced subjects like pattern making and marketing, according to GMAC. It is meant to move Cambodia higher up the value chain and alleviate a significant skill shortage in the country, according to government officials and the private sector.
“We hope that this will help meet some of the human resources needs of garment and footwear factories and reduce our dependency on foreign labor for management positions and other specific functions,” Van Sou Ieng, the president of GMAC, said in a statement.
The institute is scheduled for completion within 18 months according to GMAC secretary-general Ken Loo. Mr. Loo said the plan has been in the works since 2008, but events including the global financial crisis and the 2013 Cambodian elections got in the way.
But French donor Agence Francaise de Developpement recently offered a loan for the $3 million project, giving it new impetus.
The institute hopes to train more than 1,600 people in its first three years. The GMAC estimated about 8,000 foreigners hold advanced garment jobs. The association wants to replace them with locals.
In addition, it will offer 12-month courses to 240 university graduates who want to make a long-term career in the garment industry.
GMAC is seeking technical advisors to help set up the institute. Courses have not yet been finalized, but Mr. Loo expects a variety of subjects and course levels, including production engineering, quality control and garment design.
Skilled Labor Shortage
The garment sector is one of Cambodia’s economic pillars, employing about 600,000 people and generating $6 billion a year. But most of that work is labor-intensive and the Kingdom loses out to neighboring countries on productivity.
“A lack of solid training methods and insufficient management information systems lead to a lack of workers’ skills, especially at middle management levels,” AFD said in a statement.
The government’s newly released industrial development policy spells out the need for better vocational training to compete against other Asean countries.
“Overall, skills training remains inadequate to service the industrial sector, which suffers from low productivity as a result,” the policy report said.
Ajay Mandavkar, a representative of a Thai company that does embroidery work, said Cambodian manufacturers demand highly skilled embroidery from Thailand because Cambodian employees cannot do it.
Low salaries here create a disincentive for local workers to improve their skills, he said.
Ath Thorn, head of the country’s largest garment workers union, said the project would help bridge the skills gap of local workers.
“It’s good because right now the training has to come from the employer and often they don’t do it,” he said.
He said GMAC should work closely with unions and take on some of their leaders as consultants or advisors. He said if unions were not involved “it may be difficult for poor people in rural areas to access the skill training.”
GMAC did not comment on whether it would work with any unions in setting up the training institute.
A Leading Industry
Last year, the garment and footwear industry grew 9.3 percent to $5.8 billion, from $5.3 billion in 2013. Footwear exports grew even faster, increasing 23.9 percent to $438 million over the previous year.
The Cambodian Investment Board says 78 new garment and footwear factories were approved last year, with a total value of $452 million of fixed assets. In the first quarter this year, 19 more factories, worth $72 million, were approved.
With new factory openings, employment is rising. The garment worker population increased from 497,200 in 2013 to 580,900 last year, official statistics show. During the first quarter, that number hit 605,100.
Last year, Cambodia’s garment and footwear exports to the EU rose more than 27 percent, but those to the US fell 6 percent, data from the International Labor Organization (ILO) showed.
The EU became Cambodia’s biggest market, accounting for 42 percent of garment and footwear exports last year.
The ILO attributed the change to strong demand from European buyers.
The US now imports 34 percent of Cambodian garments. The rest of the world, mainly Canada and Japan, imports 24 percent. Exports to the rest of the world also fell this year.