TAP CHi CQNG THirdNG
FORECASTING LABOR DEMAND
FOR INDUSTRIAL DEVELOPMENT IN ETHNIC MINORITY AND MOUNTAINOUS REGIONS
> DUONG HUONG LAM
ASBTRACT:
IndusQrial development is an important orientation for the social-economic development of ethnic minority and mountainous regions in Vietnam in the coming period. However, the industrial development in these regions have faced many challenges due to the sparse population and lower literacy levels compared to other regions. Therefore, forecasting labor demand is especially important for local managers to have appropriate pohcies to prepare human resources for the industrial development in the near fumre. This study forecasts the industrial labor demand of ethnic minonty and mountainous regions up to 2030 by using the forecast model and data of Liu et al in the period 1986-2016. The dependent variable of this model is the namral logarithm of labors using in the region's industries while the independent variables are the industrial production value and the labor demand in the previous year. The study's findings show diat the industrial labor demand of ethnic minority and mountainous regions by 2030 tends to increase. By 2030, it is forecasted that the demand for industrial labor will increase to 3,136,549 in the scenario of the highest growth of industrial production value.
Keywords: Industry, forecast, labour needs, development, ethnic minority and mountainous regions.
1. Introduction
Ethnic mountainous areas have rugged terrain and mostly high mountains. Travel is very difficult and the industrial development of this region is not simple. However, with the spillover of the remaining areas for the ethnic mountainous areas, the industrial development of these regions will he increasingly strengthened in the near future.
Workforce is one of the important factors contributing to Ihe output of the production
process that ensures success m business.
Therefore, human resource planning for development is indispensable in all economic development processes in general.
Because of the importance of human resource planning for industrial development in the future.
the core subject of the research is focused on the forecasting the demand of industrial labor markets in ethnic mountainous areas to 2030. Forecast results shown that the industrial labor demands in
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ethnic mountainous areas increased by an average of 7.4% from 2017 to 2030. During this period, the industrial labor supply still met the demand.
However, in 2030, the gap between supply and demand will significantly narrow. Therefore, the plan to develop and steady the labor supply for the increased demand is an urgent requirement that must be addressed.
2. Forecasting model
To forecast the labor demands for industrial development in ethnic minority and mountainous areas, the author used the forecast model that Liu et al (2016) used to forecast the human resource demand for the health sector until 2030 of all countries around the world. The dependent variable of the model is the natural logarithm of labor using in the region's industry, and the independent variables included in the model are the industrial production value and labor demand in the previous year. The labor demand in this year depends on the business results in the previous year and the number of employees hired from the previous year, Other variables could also be included in the model, such as labor productivity and wages. However, because of the absence of data on these two variables, the author only include the previous two variables. The forecasting model is as Equation 1.
In which "In labor," is the natural logarithm of labors working in the industry of ethnic minority and mountainous areas in year t, "In labor,,/'" is the natural logarithm of labors working in industries in ethnic minonty and mountainous areas in year t-1, and "In vo/we,./' is natural logarithms of industrial production value of region in year t-1, et the interference factor of the model;
OQ, P|, p2 ^r^ the parameters that need to be estimated in the model.
3. Forecasting results
The industtial production value of the region was actually collected until 2016 from the Vietnam General Statistics Office, because in the model it was assumed to be exogenous variable.
so the remaining values from 2017 to 2030 were calculated based on the Vietnam Industrial Development Strategy to 2025. The vision to 2035 was approved under Decision No. 879/QD-TTg of June 9, 2014. The Vietnam Industnal Development Strategy to 2025 and vision to 2035 set specific industrial value growth targets as follows: the growth rate of industrial production value in the period to 2020 reaches 12, 5-13.0%
each year, the period of 2021-2025 reaches 11.0- I2.57f each year and die period of 2026-2035 reaches 10.5'7c -11.0% each year. We also propose a scenario assuming that the industry of the ethnic minority and mountainous regions also grows at a rate equal to the country's industrial growth rate as set out in the Strategy.
The average growth rate of industrial production value from 1985 to 2016 of ethnic minority and mountainous areas reached 10.34%;
Meanwhile, the whole country in this period was 12.36%. The growth rate of industrial production value of ethnic minority and mountainous region is 2.02% lower than that of the whole country.
Therefore, the author proposed a second scenario to maintain the growth rate of production value of ethnic minority and mountainous areas lower than the whole country by 2.02% in the period after 2016 to forecast labor demand of the region's industry. On that basis, the author gave three prediction values of industrial labor demand of the region with corresponding names of low, medium and high growth. Low growth is that the author takes the two margins of the growth of the country's industrial production value under the Strategy and adds up the average to divide by 2.027f to add the industrial growth value of ethnic minority and mountainous region with the low growth scenario; the average growth is equal to the lower boundary value of Vietnam's industrial growth as outlined in the Strategy; and high growth IS as high as the upper growth rate of the Strategy After proceeding with estimating Equation 1, the author got the results as in Table 1.
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Table 1. Estimating labor demand in Industry in ethnic minority and mountainous region
1 m
VARIABLES ln/abor(.,
Ln/afaor 0 842™
(0.0896) Inra/ue^.j
Constant
Obsen/ations R-squared
0.0984"
(0.0470) 1 177 (0.772) 31 0.973 Note: Standard errors in parentheses, *** and ** mean reliable statistical values at 99% and 95%; In is natural logarithm: observations are ihe total number of observations: R-squared is the square of the smallest error.
Source: Author's Calculation
Based on the estimation results, it is clear that the industrial labor demand of ethnic minority and mountainous areas depends on two factors: the industrial production value of the previous year and the hired labor of the previous year with dependence such as after:
- The labor demand of the next year increases when the labor demand of the previous year increases and the corresponding increase is 0.842%. That is, when the labor demand of the previous year increased by 1%, the labor demand of the following year increased by 0.842%,
- The labor demand of the next year increases when the industrial production value of the previous year increases and the corresponding increase is 0.0984%. That is, when the industrial production value of the previous year increased by 1%. the industrial labor demand of the following year increased b\ 0.0984%.
Especially, the least squared enor value of the model is up to 97.3% close to the value of 1, proving that the model was built in accordance with the data set usmg regression run up to 97.3%.
The square R level is very high, reasonable to forecast the industrial labor demand of the region until 2030. The indusuial value of the region from 2017 to 2030 based on the above scenarios was calculated and shown in Table 2.
Table 2. Growth scenarios of industrial production value in ethnic minority and
mountainous regions till 2030 Unit: % Year
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Low growth 10,73 10,73 10,73 10,73 9,73 9,73 9,73 9,73 9,73 8,73 8,73 8,73 8,73 8,73
AveiBge growth 12,6 12,5 12,5 12,5 11 11 11 11 11 10,6 10,5 10,5 10,6 10,5
High growth 13 13 13 13 12,5 12,5 12,6 12,5 12,5 11 11 11 11 11 Source: Author's Calculation
With the scenarios of industrial production value as above and based on the estimation results of equation I, the author forecast Ihe region's industrial labor demand as follows (forecast results are provided in Figure 1).
From the industrial labor demand forecasts in ethnic minority and mountainous areas, the author compared the industrial labor market of this
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Figure 1: Forecast of industrial labor demand in ethnic minority and mountainous areas by 2030 (Unit: person)
2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
• Scenario 1 - Low growth ^ ^ ^ Scenario 2 - Average growth — — Scenario 3 - High growdi
region with these regions with the given scenarios. The comparison helps us to determine whether in the period from now to 2030, the region's industrial labor market will be under pressure from a lack of supply or a lack of demand in order to develop the labor market most effectively.
Detailed data on industrial labor demand forecast is presented in Table 3.
4. Conclusion
Labor is one of the important input factors for production, the more labor force increases, the more value of production increases. Accurate determination of labor demand to ensure a continuous and highly efficient production process is a necessary component in a region's socio-
Source: Author's Calculation Table 3. Forecast of industrial labor demand In ethnic minority
and mountainous areas till 2030 with 3 scenarios Unit: Persons Year
2017 2018 2019 2020 2021 2022 2023 2024 2026 2026 2027 2028 2029 2030
Low growth 1.163.153 1.249.732 1.360778 1.456.703 1.567.966 1.683 606 1 803.781 1.929.241 2.060.359 2.197.634 2.339.476 2 486.378 2.638 840 2.797.386
Average growth 1 153.153 1.261 684 1.356 782 1.469.015 1.588.994 1.713 679 1.843.230 1.978.441 2.119 738 2.267.676 2.423.916 2.589 099 2.763.906 2.949.043
High growth 1.153.153 1.252.231 1.358.467 1.472.477 1 594.928 1.725.780 1 866.748 2.015.592 1 2.176.130 2.348.238 2.529.608 2.720.742 2.922.790 3.136.550 Source: Author's Calculation
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economic development plan. The paper has scenario of the highest growth of industrial forecast industrial labor demand of ethnic production value. With the prediction of industrial minority areas with the results: industrial labor labor supply and demand for ethnic minority and demand of ethnic minority and mountainous mountainous areas, the audior hopes this forecast regions by 2030 tends to increase. By 2030, it is will be a useful reference for policy makers on forecasted that the demand for industrial labor planning for industrial development in ethnic will increase to 3,136,549 according to the minority and mountainous areas in die future!
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[7] 1. Liu, J., Goryakin, Y., Maeda, A., Bruckner, T. and a Schefer, R. (2016), "Global Health Workforce Labor Market Demand Projections for 2030", Policy Research Working Paper, Health Nutrition and Population Global Practice Group, World Bank Group.
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Received date: July 1,2020 Reviewed date: July 14,2020 Accepted date: July 30, 2020
Author information:
DUONG HUONG LAM
Thai Nguyen University of Technology Thai Nguyen University
218 Sd 17-Thang 7/2020
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DV BAO NHU CAU LAO DONG CHO PHAT TRIEN
C 6 N G N G H I E P VUNG DAN TOC THIEU SO
VA MIEN NUI TAI VIET NAM
• ThS, DUONG HUdNG LAM Dgi hoc Ky thugt Cong nghidp
Dqi hoc Thdi Nguyen
TOM TAT:
Phdt tnen cong nghi6p la dinh hifdng quan trpng de phat trien kinh te - xa hoi vung dan tpc thieu so va miln nui Viet Nam trong giai doan s^p tdi. Trong khi do, dan cd thUa thdt vh c6 trinh dp dan cd tha'p hPn cic khu vifc khac lu6n la mpt trong nhu'ng thach thiJ'c gSy nhilu kh6 khan cho phat trien cong nghidp d khu vyc nay, Vi vay, dif bdo nhu cau nhSn lUc cho phat trien c6ng nghidp IS dac biet quan trpng di cde nhd quan Iy dia phifdng c6 nhffng ehinh sach phii hdp de chu^n bi tot ngu6n nhdn life cho qua trinh phat trien cong nghiep d giai doan s^p tdi. Bai viet da dif bao nhu clu lao ddng cdng nghiep d viing dan tgc diieu so' vd miln ndi dd'n ndm 2030 biing cdch su" dung mo hinh dijf bao ci5a Liu va cpng s\i va dff lidu trong giai doan 1986-2016. Bid'n phu thupc cua mo hinh Id logarit tff nhien cua lao dpng sijf dung trong ngdnh cua khu vffc vd cde bie'n dpc lap trong md hinh la gia tri san xua't cong nghiep vd nhu cau lao dpng trong nam tnfdc. Ke't qua nghien cffu da chi ra rdng: Nhu cau Iao dpng cdng nghidp tai vung dan tgc thid'u sd va mien niii tdi ndm 2030 cd xu hffdng tang. Dd'n ndm 2030, dff bdo nhu ciu lao dOng edng nghidp se tang Idn 3.136.549 ngffdi dieo kich ban tdng trffdng cao nha't cua gid tri sdn xua't cdng nghiep.
Tiif khoa: Cdng nghiep, dff bdo, nhu cau lao ddng, phat triin, vung dan tdc thieu so' vd miln nui.
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