Responses from the thirty MNCs shortlisted for the detailed study indicated that labour supply and the training and development of manpower were critical factors in their investment decisions. All cited Singapore's superior work-force as one of their chief reasons for investing in Singapore. At the same time, however, they cited Singapore's shortage of labour, particularly at the operator level, as the reason why they had moved out some of their operations. Their main reason for choosing Malaysia and Thailand as the preferred new location was precisely the availability of a large pool of low-cost trainable workers.

Based on the responses from the thirty companies interviewed as well as additional research, this chapter reviews the labour supply situation in each of the three countries. It also covers the important but often neglected role of manpower training and development, particularly in technical disciplines. In addition, it surveys the quality of the work-force in each of the ASEAN-3 and their wages and benefits. The conclusions, presented at the end of the chapter, assess whether labour constitutes a competitive factor in the ASEAN-3, or whether the differences in labour resources have instead led to greater complementarity among them.

THE LABOUR SUPPLY SITUATION

Singapore

Following the strong recovery of the Singapore economy from the 1985/86 recession, companies have faced a tight labour market at all levels of the work-force — from production operators to post- graduate researchers. With a total work-force of only 1.25 million, demand for labour has outstripped supply, especially after the economy bounced back strongly from the 1.6 per cent decline in GDP in 1985 to 11 per cent growth in 1988.

The MNCs indicated that the most serious labour shortage in Singapore occurred at the operator level. Shortages at other levels exist but are not as critical.