The ongoing capital shift from China to Vietnam in the manufacturing sector will contribute to rising manpower needs.

According to Navigos Search’s report on employment needs for mid-level and high-level personnel in the fourth quarter of last year, foreign direct investment (FDI) enterprises in electronics manufacturing plan to move their workshops from China to Vietnam.

This shift was earlier forecast by experts, who believe that as a result of the trade war, workshops from China will move to Vietnam to avoid taxes.

In reply to the Saigon Times’ question on the effects of the trade war on Vietnam’s manpower, Navigos Group CEO Gaku Echizenya said that no country will benefit from it. However, while labor costs in China have increased considerably, Vietnam is still attractive to foreign investors thanks to its low labor costs, favorable location, fast economic growth, political stability and economic openness.

Last year, Vietnam received significant FDI capital from Japan, South Korea, China, Singapore and Taiwan.

According to Echizenya, European enterprises have also started to regard Vietnam as an investment destination, particularly in the manufacturing sector. This will lead to a rising employment demand in all segments.

He pointed out that FDI inflows will help provide more job opportunities for Vietnam.

As shown in a VietnamWorks report on 2019 employment needs, up to 74% of business leaders have plans to employ more workers during the year.

Nonetheless, it is undeniable that Vietnam’s labor is limited in terms of both quantity and quality. Vietnamese workers need to improve their skills to keep pace with international standards, Echizenya remarked.

The report from Navigos Search pointed out that enterprises moving from China to Vietnam face a major employment challenge as their suggested salaries are not competitive compared with those offered by existing businesses. Therefore, candidates are hesitant to change work environments.

Besides capital inflows from Asian and European countries, domestic enterprises in the electronics manufacturing sector in Haiphong and Bac Ninh had expansion plans last quarter. New enterprises will begin operations early this year as well.

According to Navigos Search’s forecast, electronics manufacturing will continue to see an increase in employment needs this year, including for both mid-level and high-level personnel.