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Vietnam’s human resources and the fear of missing opportunities

The lack of many highly qualified human resources leads to low labor productivity, hindrances for production expansion, and meeting of customer demands, affecting overall business results.

The Vietnam Universal Scientific Industrial Company Limited (USI), located in the DEEP C Dinh Vu Industrial Park in the northern port city of Hai Phong, specializes in manufacturing electronic equipment. USI managers tell VietNamNet that one of the difficulties that this firm is facing is the difficulty in recruiting technicians to operate high-precision equipment and automated machinery. In 2022, USI needs about 500 technicians, but it is difficult to hire enough people.

The lack of many highly qualified human resources leads to low labor productivity, hindrances for production expansion, and meeting of customer demands, affecting overall business results.

This is a common situation for most enterprises in Vietnam in recruiting qualified human resources to meet the needs of production expansion and development.

According to the General Department of Vocational Education and Training under the Ministry of Labour, Invalids and Social Affairs, Vietnam has about 55 million workers, but only 64.5% of them have been trained, of which 24.5% have degrees and certificates. This figure is equivalent to one third of that of developed economies such as South Korea, Taiwan, Singapore...

Annually, vocational training facilities in the country recruit about 2.2 million students, which is too low compared to the demand for skilled human resources.

A recent report by the Ministry of Industry and Trade shows that labor productivity in the industry is low compared to that of other countries in Southeast Asia. Industry is also the sector with the lowest labor productivity growth rate among economic fields. The main reason is the low skilled labor force, with 28.54% of the workers are not trained well.

According to the Central Institute for Economic Management (CIEM), informal and unskilled workers still make up the majority in Vietnam’s labor market. The country is currently in the group of countries with low national competitiveness indicators related to human resources.

For example, in terms of labor skills, Vietnam gets only 46 out of 100 points, ranking 103 out of 141 ranked countries. Training quality ranked 102 out of 141 countries. The low quality of human resources is seen as a "minus point" in attracting foreign investment.

Vietnam has joined many Free Trade Agreements (FTAs), with commitments on high-quality labor and employment. On the other hand, the industrial revolution 4.0 also places many challenges in terms of technological change, requiring skilled human resources. Experts predict that in the next five years, working processes all over the world will quickly shift to digitization and in the next 10-15 years this will have a great impact on Vietnamese workers.

'Golden' opportunity is about to pass

Vietnam has set the goal of becoming an industrialized country, surpassing the low middle income level by 2025; a modern industrialized country with high middle income by 2030; and a developed and high-income country by 2045.

Vietnam is now in the period of "golden population", with people of working age accounting for over 50% of the population. However, it is estimated that the "golden population" period will end in 2040.

The fact shows that a country that does not make breakthroughs in the "golden population" period will be difficult to overcome the “middle income trap” and will never become a developed country. The “golden” opportunity will be missed if Vietnam does not accelerate investment in human resources.

To develop a workforce to meet the country's development needs, the Prime Minister issued Decision No. 2239/QD-TTg on “Strategy for development of vocational education and training in the period of 2021-2030, with a vision to 2045" in December 2021.

The strategy aims to have the training quality of a number of occupations approaching the level of developed countries in the region and the world and increase the percentage of trained workers with degrees and certificates to 30% by 2025. By 2030, some occupations will reach the level of developed countries in the G20 group; increasing the rate of trained workers with degrees and certificates to 35-40%.

By 2045, Vietnam will become the leading country in vocational education in Southeast Asia, catching up with the advanced level of the world, having outstanding competitiveness in a number of fields, industries and training occupations.

However, the difficulties and challenges in vocational education are huge. The structure of vocational training in Vietnam is unsuitable to the actual situation. The contingent of State management staff in vocational education is still weak. Application of information technology in training and vocational education and management is still low. The quality and effectiveness of training of many vocational education institutions have not yet met the human resource requirements of specific industry and field and the requirements of socio-economic restructuring.

According to the General Department of Vocational Education and Training, to support the retraining of workers to improve the quality of human resources, the Government has approved a budget of up to VND4,500 billion. However, despite drastic implementation, the results were quite disappointing. In the past year, only 30 working sessions have been held with localities and businesses across the country, with disbursement of about VND60 billion.

Experts said that, to improve the quality of vocational education, meet the requirements of integration and realize the strategic goals of human resource development in the 2021-2045 period, Vietnam needs to develop a plan with a series of solutions as follows:

Improve institutions, effectively implement the national framework of vocational skills qualifications, standardize sets of standards in vocational education to approach standards of ASEAN-4 and G20 countries;

Accelerate digital transformation, modernize facilities and equipment, and renovate training programs and methods, focusing on practical experience and professional competence in the digital era; linking vocational education with businesses and the labor market.

Increase annual budget for vocational education, diversify investment resources, encourage the private sector’s participation and support from developed countries and international organizations; promote comprehensive cooperation between Vietnam and other countries and international organizations in the field of vocational education; promote and diversify communication activities on vocational education to students, workers...

Tran Thuy


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