The impact of human resource management regulations and activities of foreign invested enterprises on human resource development: a case of Laos special economic zone
Creators: name: Keomahavong, Vilaty
Publisher: name: Zenodo
Year: 2024
Subjects: Special economic zone
human resource development
regulations and activities on human resource management
businesses of foreign investors

description: Purpose/objectives: This research deals with measuring the influence of SEZ in Laos on the development of human resources at the Macro/zone and Micro/firm level. The systematic measurement of the impact of Laos SEZs on human resource development at both levels shall be categorized and utilized to recommend comprehensive policies and incentives to enhance human resource development in Laos SEZs and the rest economy. The purpose is to show how Laos SEZ created job opportunities to the locals and how HRM programs and activities of foreign-invested companies influence human resource development.Design/methodology/approach: The objective of this study has been directed in a mixed approach over two years. The information and data were analyzed at the macro and micro level. At the macro level, mixed methods were applied that included secondary research and semistructured interview. The secondary study examines the impact of SEZ on employment in Laos in three different ways, such as direct, non-direct, and gender employment. A free zone in Laos was selected to be a case study. Furthermore, semi-structured interviews involving relevant management authorities of Laos SEZs were conducted to explore current management incentives and policies encouraging the development of HR, opportunity, and challenge of such development in Laos SEZs. At the micro level, mixed methods were also conducted, such as semi-structured interviews and survey research. The firm-level research investigates the effectiveness of HRM programs and activities of foreign-invested companies located in Laos SEZ. Three case studies were conducted. Semi-structured interviews were conducted to explore the efficacy of HRM programs and activities involving hiring and training staff, rewards and compensation, retention, career evaluation, and labor union and relation, semi-structured interviews were established. Also, the way national cultural impact on HRM of FIEs were also explored through semistructured interview HR managers. Moreover, survey questionnaires confirmed the validity of the interview and examined the relationship between the HRM policies and practices and HR development, which are based on the quality of life, working and living conditions, earning career prosperity, and knowledge and skill development. Outcomes/Findings: The outcome represents a significant contribution to policies and incentives that encourage human resource development of Laos special economic zones. They will help policymakers an in-depth understanding of the current opportunities and challenges of human resource development in Laos SEZs, and establish the policies based on the way employment was generated. Also, they shall assist the policymakers in developing incentives to investors based on the significance of the contribution of each element involving HRM programs and activities of foreign-invested enterprises. The findings from macro-level analyses demonstrated that:• The case study zone named Savan-Seno SEZ contributed a small fraction of employment within the province where the zone is located. Yet, numbers of employment have been soaring in the last five years (2012-2017). Topic of thesis: The Impact of Human Resource Management Regulations and Activities of Foreign Invested Enterprises on Human Resource Development: A Case of Laos Special Economic Zone4• Evidence from sub-contract between foreign-invested enterprises and local businesses appeared to be significant evidence of indirect employment generate outside the zone. Also, the interview zone economic board and developer revealed significant development of small-medium enterprises outside the territory as well as infrastructure activities. • The zone impact on gender employment since a significant number of employees at managers and non-managers are female between 18-35 years old. The findings from Micro-level analyses demonstrated that:• The results of the within-case analysis and the cross-case analysis of each company validated that foreign-invested companies implemented formal HRM policies and practices. Yet, informal practices usually occur during the recruitment and selection process of operational employees. • National culture played a significant role on HRM management since norms and beliefs of major Laotian people are strongly rooted from a single religion. To help Laotian workers become familiar with the new working system, foreign directors should be the one designing system and let their subordinates work with operational employees.• The results from the previous and current case studies were then used in formulating survey questionnaires. The number of six hypotheses was postulated to explore the correlation amid HRM policies and practices and the employees’ insights on HR development. After the pilot study, questionnaires were disseminated to 78 correspondents. There were 76 responses to the survey. Since a suitable sample size was 75, the response rate is 100 percent.• The relationship among each controlled variable and the response variable of human resource development’s perception revealed positive results. A model that projected human resource development from six independent variables of HRM policies and practices was generated using regression analysis. The model suggested that three predictor variables (training and development, retention, and labor union and relations in trade) meaningfully presented to a perception of human resource development while the other three factors (recruitment and selection, prize, and work assessment) refused to do so.Research contribution and limitations: This research contributed to both the theory and practices of international human resource management policies and implementation. In theory, the thesis added knowledge on the global human resource management's impact on human resource development. The new method derived from various findings and analyses of SEZs benefits at the macro and micro levels leads to new practices that are implied at the end of this study.