To understand the factors for improving skill development in the manufacturing industry, the study utilized mixed-method research combining surveys and in-depth interviews to collect data from 101 firms. 36 in-depth interviews with the firms' human resources and production departments were carried out. A binary logistic regression model was used to explore the relationships between in-employment skill development and eight influencing factors such as FDI, change in products, technology usage, work organization, sales performance, year of operation, export, and require more skilled workers. Qualitative comparative analysis was applied to outline the industry skill formation systems, specifically for medium and high-skilled employees. The results indicate that in-employment skill development is highly likely to be influenced by years in operation, export-oriented production, and the requirement for more skilled workers in individual firms. Furthermore, the skill development in firms is aligned with firm governance, management objectives, recognition, and worker participation. It is acknowledged that in-employment skill development caters to only specific employees, such as medium and high-skill workers. Based on these findings, the study recommends enhancing worker participation in in-employment training with firms that run long-term operations, produce exports, and require more skilled workers; and the study concludes that incentive systems are essential to improving in-employment skill development.