Lessons we can learn from Thai engineers
It is often difficult for Thai engineers to work in other countries and for engineers from other countries to work in Thailand, but labor mobility initiatives are underway that could ease restrictions.
One of the promises of establishing the ASEAN Economic Community was the creation of a single market area with significantly reduced barriers to trade in goods and services. Part of this vision is the free movement in skilled workers through mutual recognition agreements. These landmark agreements allow for shared recognition of skills and qualifications by member countries of the Association of Southeast Asian Nations (ASEAN).
Currently, mutual recognition agreements in ASEAN cover eight professional occupational categories, including accounting, engineering, nursing, architecture, medicine, dentistry, tourism, and surveying. Does establishing mutual recognition agreements in professional categories induce workers to move within the ASEAN Economic Community? To answer this question, we conducted a study that focused on the market for engineers with special attention on Thailand.
We looked at why workers decide to move for employment and how mutual recognition agreements affect the decision to move. It is widely recognized that there are “push” and “pull” factors that affect the decision to migrate abroad for employment. Some of the push factors include low pay or a lack of employment opportunities in the home country. Pull factors include better employment opportunities and more attractive compensation abroad.
However, even if attractive employment opportunities exist abroad, potential migrants need to overcome several barriers to migration. These barriers include the direct costs of migration and job search. Non-monetary psychological costs of working and living abroad, including the loss of one’s immediate support network and an unfamiliar work culture, are also important factors migrants consider.
Workers who are willing to confront the direct and indirect costs of migration for employment opportunities abroad may still face legal barriers to accessing available employment. For example, Thailand restricts employment to Thai nationals in many job categories and, where there are not outright bans on employing foreigners, licensure exams are often conducted in Thai language only, effectively barring foreigners from many professional employment opportunities.
The ASEAN mutual recognition agreements help overcome these legal and practical barriers by recognizing professional training and accreditation across member states, potentially saving prospective migrants from having to invest in costly country-specific professional certifications. Despite the theoretical benefits of mutual recognition agreements, as of July 2019, only 3,735 engineers had registered as an ASEAN Chartered Professional Engineer. We looked at Thailand as a case study within ASEAN to discuss potential reasons why the mutual recognition agreement for engineering professionals has had limited impact.
Engineering opportunities are abundant and experienced engineers are in demand.
Despite becoming a party to the mutual recognition agreement on engineering services in 2009, there are currently only 220 ASEAN Chartered Professional Engineers from Thailand. Why do so few Thai engineers want to take advantage of the mutual recognition agreement? Consider the push factors. Economic migrants often seek employment abroad because of a lack of well-paid opportunities at home. For Thai engineers, this is not the case.
Engineering opportunities are abundant and experienced engineers are in demand. This is borne out in the Thai Labor Force Survey, which shows that individuals who graduate with tertiary degrees in engineering generally have high match rates in the engineering profession. Also, we find that the distribution of engineers’ incomes is higher than for workers in other occupational categories. Since engineering jobs are currently plentiful and well-paid, the traditional push factors for labor migration are largely absent in the Thai context.
What about the pull factors? Even if the push factors are not strong, if the wage differentials between Thailand and other countries are sufficiently large, we would see outmigration of Thai engineers to other countries. What do the wages look like for engineers across ASEAN? It turns out, Thailand has relatively high wages among engineers in ASEAN. According to the figure below, only Singapore and Malaysia have higher average monthly income than Thailand. The takeaway message here is that in general, wages for engineers in other ASEAN countries are not attractive compared to wages in Thailand. Without strong push or pull factors present, it is no wonder that Thai engineers are not pursuing ASEAN Chartered Professional Engineer credentials and using mutual recognition agreements for engineering professionals to work abroad.
With relatively high engineering wages in Thailand, one would expect the mutual recognition agreement to facilitate large flows of ASEAN engineers to seek employment in the country. Again, this has largely not been the case. Even though the mutual recognition agreement may reduce the cost of gaining accreditation abroad, there are many other costs that remain unaffected. For example, in the case of Thailand, the language of business is Thai, not English. Even with the implementation of the mutual recognition agreement, without a working knowledge of the Thai language, it is difficult for foreign engineers to find good employment and adapt to the local work culture.
Overall, the implementation of mutual recognition agreements has not been enough to induce a free flow of skilled labor across ASEAN. Engineers in ASEAN may not consider work abroad because of the absence of push and pull factors in some of the labor markets. Likewise, other barriers, such as language and work culture, will remain challenges to realizing the free flow of professionals across the ASEAN Economic Community.
This blog post is based on research from the publication, Skilled Labor Mobility and Migration: Challenges and Opportunities for the ASEAN Economic Community.