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 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 214 So 17-Thdng 7/2020 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 gUANTRI-gUAIIlV 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 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 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 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 11.0I2.57f 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 So 17-Thang 7/2020 215 TAP CHJ CONG THlftiNG Table Estimating labor demand in Industry in ethnic minority and mountainous region m VARIABLES Ln/afaor ln/abor(., 842™ Inra/ue^.j 0.0984" (0.0896) (0.0470) 177 Constant Obsen/ations R-squared 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 Table Growth scenarios of industrial production value in ethnic minority and mountainous regions till 2030 Unit: % (0.772) Year Low growth AveiBge growth High growth 31 2017 10,73 12,6 13 0.973 2018 10,73 12,5 13 2019 10,73 12,5 13 2020 10,73 12,5 13 2021 9,73 11 12,5 2022 9,73 11 12,5 2023 9,73 11 12,6 2024 9,73 11 12,5 2025 9,73 11 12,5 2026 8,73 10,6 11 2027 8,73 10,5 11 2028 8,73 10,5 11 2029 8,73 10,6 11 2030 8,73 10,5 11 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% 216 So 17-Thang 7/2020 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 QUANTR!-QUANLt 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 - Low growth ^ ^ ^ Scenario - Average growth — — Scenario - High growdi Source: Author's Calculation 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 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- Table Forecast of industrial labor demand In ethnic minority and mountainous areas till 2030 with scenarios Unit: Persons Year Low growth Average growth 2017 1.163.153 153.153 High growth 1.153.153 2018 1.249.732 1.261 684 1.252.231 2019 1.360778 1.356 782 1.358.467 2020 1.456.703 1.469.015 1.472.477 2021 1.567.966 1.588.994 594.928 2022 1.683 606 1.713 679 1.725.780 2023 803.781 1.843.230 866.748 2024 1.929.241 1.978.441 2.015.592 2026 2.060.359 2.119 738 2.176.130 2026 2.197.634 2.267.676 2.348.238 2027 2.339.476 2.423.916 2.529.608 2028 486.378 2.589 099 2.720.742 2029 2.638 840 2.763.906 2.922.790 2030 2.797.386 2.949.043 3.136.550 Source: Author's Calculation So 17-Thang 7/2020 217 TAP CHJ CONG THlfffNG economic development plan The paper has forecast industrial labor demand of ethnic minority areas with the results: 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 according to the scenario of the highest growth of industrial production value With the prediction of industrial labor supply and demand for ethnic minority and mountainous areas, the audior hopes this forecast will be a useful reference for policy makers on planning for industrial development in ethnic minority and mountainous areas in die future! 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University 218 Sd 17-Thang 7/2020 QUAN TRj-QUANLY DV BAO NHU CAU LAO DONG CHO PHAT TRIEN C N G NGHIEP VUNG DAN TOC THIEU SO VA MIEN NUI TAI VIET NAM • ThS, DUONG HUdNG LAM Dgi hoc Ky thugt Cong nghidp... 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