A recent report by the Ministry of Labour, War Invalids and Social Affairs (MOLISA) shows a wide imbalance in the development of Vietnam’s labour market in terms of economic sectors and different geographical regions.

According to the report, Vietnam has over 48 million people of working age, of which 73 percent live in rural areas. Of the 47 million people working, up to 70 percent are in insecure employment, mainly doing self-employed jobs.
They are vulnerable and at risk of falling into poverty, stated the report.

There is a large labour discrepancy amongst the different economic sectors. While only four million people work in the state sector and 1.67 million others work in the foreign-invested sector, the non-state sector alone absorbs up to 40 million workers.

Despite having a labour force almost 24 times larger than the foreign-invested sector, the non-state sector’s contribution to the country’s GDP is only 2.4 times greater than that of the foreign-invested sector (47 percent against 19 percent of the GDP respectively).

A lot of FDI companies are having difficulty recruiting workers, both manual and skilled, said Le Quang Trung, Deputy Director of MOLISA’s Employment Department.

Reports have raised alarms that the unemployment rates remain paradoxically high in some localities despite the huge demand for workers.

The southern province of Dong Nai , where there are many FDI projects, falls short of 20,000 trained and manual workers every year. However, 23,000 people in Ho Chi Minh City – Vietnam ’s largest economic centre - have lost their jobs so far this year, yet the city is still looking for 61,000 new employees.

A survey of job centres across the country suggests that there were more than 100,000 vacancies in 2009. The number of applicants only accounted for 17 percent of the total vacancies and the number of qualified candidates made up no more than 6 percent.

The quality of the labour force is also a fundamental reason for the shortfall in the labour supply and only 30-40 percent of students find a job immediately after graduating. The remaining 60-70 percent must take extra courses to build up their skills and knowledge before getting onto a payroll.

MOLISA has submitted various measures to the government to address the imbalances, including improving information on the labour market. The ministry has also suggested expanding job centres to rural areas, reforming its policies on salaries and focusing more on productivity, efficiency and non-discriminatory treatment for enterprises in every economic sector./.