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Labor market freezes due to Covid-19

Large companies are not recruiting workers, while small and medium enterprises (SMEs) are laying off workers as they cannot maintain a big staff during the Covid-19 crisis.

Passing the final interview round for the position of production manager of an electronics manufacturing company half a month ago, Hoang still has no job offer letter.



Labor market freezes due to Covid-19

Hoang and the headhunting company, which linked Hoang and the Japanese electronics company, understand that it is not easy to find a job when Covid-19 has had a negative impact on all aspects of the national economy.

Nhung, from a well-known head hunting company, said never before has the job market become so frozen. Real estate and tourism firms stopped recruiting high ranking officers in the beginning of January.

Large companies are not recruiting workers, while small and medium enterprises (SMEs) are laying off workers as they cannot maintain a big staff during the Covid-19 crisis.

Nhung and her team were seeking candidates for the post of communication director for an education company when the partner told her to stop some days ago.

The demand for untrained workers has also dropped dramatically. According to Vu Quang Thanh, deputy director of the Hanoi Job Service Center, demand surges in the months after Tet when businesses begin gearing up for their business plan implementation and workers want to change jobs.

However, things have been different this year. The recruitment demand has decreased by 20 percent compared with the months before the epidemic.

“The labor market is gloomier than ever,” Thanh said.

Nguyen Phuong Mai, CEO of Navigos Search from Navigos Group, said the epidemic has had a big impact on some business fields. Many SMEs have laid off workers to cut operation costs. Large companies can maintain normal operation for the next six months, but they will have to restructure staff and cut welfare policies.

In the medium- and high-end recruitment market, challenges have come from both manpower demand and supply.

Employers are postponing recruitment for some key positions because of changes in the business plan implementation. Many enterprises have decided to develop existing staff instead of finding new workers.

Meanwhile, workers are more cautious when considering new job opportunities. In many cases, recruitment plans have been canceled because foreign candidates cannot come to Vietnam because of policies on travel restrictions.

The situation about layoffs remains unclear. The center reported that 7,000 workers received unemployment benefits in the first two months of the year, a slight increase of 5 percent compared with the same period last year.

However, analysts believe that with the epidemic escalation, widespread layoffs are unavoidable.

According to VietnamWorks, the number of jobs offered has decreased in some fields, such as aviation/tourism (- 28 percent), restaurants/hotels (- 21 percent) and education (- 11 percent).

Mai Lan 


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