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Labour Quality - Thorny Problem For Vietnam

In its official reports, Vietnam always confirms that it has abundant human resources that can meet the requirements of economic-social development in the future. However, the quality of Vietnam’s human resources is now a thorny problem.Lack of high-grade labourBy the end of 2006, Vietnam had a total of 45.3 million workers, three-fourths of whom were rural labourers. According to Nguyen Dai Dong, Head of the Labour and Employment Agency under the Ministry of Labour, War Invalids and Social Affairs (MoLISA), the human resources can’t satisfy the needs of the labour marketThe official said that just 32% of the labourers were trained and 14.4% had short-term vocational training certificates.The report on the labour market made by the MoLISA says: “Vietnam seriously lacks qualified technical workers and qualified service labour for the finance and banking, tourism sectors so Vietnam has to hire foreign labourers. Meanwhile, labourers for export are under-skilled.”As the need for highly-skilled manpower is increasing along with the growth of the economy in recent years, labour quality has become a hot topic at many forums.At a conference held by the MoLISA early this year, commenting about the information that Thailand was forecast to bring its workers to Vietnam in the next 8-10 years, Minister Nguyen Thi Hang expressed her worry that Vietnamese labourers could lose their home.“We may have to export unskilled workers and import skilled ones,” Ms Hang said.The low quality of workers also leads to difficulties in labour exports. On the other hand, low quality also makes salaries for high-class workers soar since employers don’t have many choices.The annual survey on investment costs by the Japan External Trade Organisation (JETRO), which was published in late May 2007, showed that salaries of mid-level employees had increased suddenly, especially in HCM City.“While the average salary increase level for mid-level staffs in other countries is 7%, it is 40% in Vietnam. This is considered the least competitive factor of Vietnam in drawing foreign investment,” JETRO’s report says.According to some labour experts, the fields that are in serious shortage of human resources are information technology, finance, auditing, law and industrial sectors. Many labourers are not fluent enough in foreign languages though this situation is being improved thanks to the increasing flow of foreigners coming to the country and the number of Vietnamese people trained abroad returning.What solutions?To solve the problem, the Government and the MoLISA are working on large-scale vocational training programmes.According to Mr. Nguyen Dai Dong, the MoLISA has submitted to the Government a programme with solutions to develop the labour market: developing the source of supply of labour, developing the need for labour, promoting transactions on the labour market, reforming the salary-wage system, perfecting the labour market institution, and the most important solution – developing vocational training.At the conference on vocational training, job and labour export held in May 2007, Prime Minister Nguyen Tan Dung expressed his concern that Vietnam ranked 77th in the world in labour productivity and had around 10 million unemployed people.National programme on employment to 2010Most recently, the Prime Minister approved the national programme on employment to 2010, under which Vietnam will spend around VND6 trillion (US$375 million) on vocational training in the next four years.Specifically, from 2006 to 2010, this programme will create jobs for 2-2.2 million people, modernise 30-40 employment service centres and complete the information system on the labour market, and train 75,000 employees of employment related agencies from the local to central levels.The programme includes three major projects: borrowing capital to create jobs, exporting manpower, and developing the labour market.Relating to labour export, this programme aims to send 40,000 to 50,000 workers abroad. Those people will be trained vocationally by state funding.Of the VND6 trillion for this ambitious programme, more than VND4.8 trillion will come from the state budget, VND560 billion from local budgets, VND500 billion from the community and around VND30 billion from the international community.The Minister of Labour, War Invalids and Social Affairs is the head of the steering board of this programme.

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