VietNamNet Bridge – The Ministry of Labor, War Invalids and Social Affairs (MOLISA) will work with the International Labor Organization (ILO) on a new method to calculate the unemployment rate in Vietnam after the second quarter’s 1.84 percent rate raised controversy.

MOLISA’s Deputy Minister Pham Minh Huan said the biggest problem of the current unemployment calculation method was in the sampling.

“In developed countries, the statistical work can be done well, thanks to the unemployment registration system. In Vietnam, it entirely depends on the sampling conducted by the General Statistics Office. The method can hardly bring reliable results,” he explained.

When asked if Vietnam would apply the new statistical mechanism suggested by ILO (the International Labor Organization) at the 19th International Conference of Labor Statisticians (ICLS). Huan said in principle, MOLISA advocates the application of new statistical methods.

However, he said it would be better for Vietnam to approach the new method step by step to avoid shock to society. It is obvious that if applying the new calculation method, the unemployment rate in the next quarter of the year would jump from the 1.84 percent in the second quarter.

In the immediate time, Huan said, it is necessary to clarify how “unemployed” means in Vietnamese conditions.

Vietnam has been applying the statistical method and the definition of “unemployed” put forward at the 13th ICLS in 1982. The method and definition have been used in most countries, including developed and developing economies.

However, they are not appropriate to economies like Vietnam, where there are not enough good and stable jobs, making it impossible to take full advantage of the potential of the labor force.

In October last year, the 19th ICLS put forward a new definition of unemployment calculation. Under the definition, employed workers would be those aged over 15 who participate in activities to make products or provide services for certain periods and receive salaries or make profits from the activities.

This method would make major changes to the way Vietnam’s unemployment rate is calculated.

Unemployed workers would include people in the agriculture sector who are self-sufficient and have little connection with the market; workers who want to have a job equal to those with normal working hours; people who are not actively looking for jobs; and workers who do not receive salaries during probationary periods.

ILO said it would take Vietnam time to adapt to the new statistical methods, and for the time being, it would be better to follow the existing method.

TBKTSG