ManpowerGroup highlights top industries attracting employers in Vietnam

How do you evaluate the human resource market in Vietnam?

The human resources market in Vietnam appears to be very promising, with several noteworthy potential factors.

Firstly, the large population and abundant labor force are significant strengths. According to the General Statistics Office, Vietnam's population surpassed 100 million people in 2023, with an average annual birth growth rate of about 1 million people. Vietnam ranks among the top three countries with the largest populations in Southeast Asia, following Indonesia and the Philippines, and is 15th globally. ManpowerGroup's Vietnam Total Workforce Index 2022 report also noted that Vietnam has a significant labor force, with approximately 50.74 million people.

Secondly, the young workforce in Vietnam shows good adaptability to technology and a focus on sustainable development. Generation Z, which is expected to make up nearly one-third of the labor force by 2025, will play a crucial role in Vietnam's labor market. Moreover, Vietnam has over 70 million social media users, especially among the younger generation, equivalent to 71% of the total population. The Generation Z workforce also demonstrates a high awareness of diversity, equity, inclusion and sustainable development criteria.

However, Vietnam faces some limitations in its labor force. Highly skilled labor accounts for only 11.67% of the total workforce, lagging behind countries in the region such as Thailand (15.08%) or Malaysia (28.24%). This indicates the need for Vietnam to enhance training and develop specialized skills.

Additionally, the percentage of Vietnamese labor with English proficiency for work is only 5%, much lower than non-English-speaking countries in the region like Indonesia (10%), Malaysia (21%), and Thailand (27%). In the era of international integration, Vietnam needs to improve the English proficiency of its labor force as many new jobs require fluency in English or another foreign language. To unlock the potential of Vietnam's labor market in the integration phase, workers themselves need to make significant efforts to adapt to the rapid development pace and the demand for high-quality personnel.

From Manpower's consulting activities, which industries in Vietnam are currently attracting employers?

Through ManpowerGroup Vietnam's hiring and consulting activities with clients, partners, and professionals in various fields, we have observed attraction towards employers in the following industries:

Firstly, the manufacturing, processing, and production industries. In 2022, these industries continued to be key sectors in Vietnam. They significantly contributed to the economy with an impressive growth rate of 9.6% compared to the previous year. ManpowerGroup Vietnam's clients in the manufacturing, processing, and production sectors have shown an increasing demand for recruitment in the second half of 2023, which is a positive sign for Vietnam's economy.

Secondly, the high-tech industry. Vietnam is experiencing remarkable growth in the demand for high-tech personnel to meet the increasing digitalization. According to the "The New Human Age" report by ManpowerGroup, over 80% of businesses have shifted their focus towards post-Covid-19 digital transformation. Key areas in this industry include cloud computing, artificial intelligence (AI), robotics, and automation.

Thirdly, green technology and renewable energy industry (wind, solar, hydro). According to baochinhphu.vn (government portal), the potential contribution of wind and solar energy to Vietnam's GDP could reach $70-80 billion, creating 90,000-105,000 direct jobs. In the first six months of the year, the green sector had the highest demand for personnel, accounting for 30% of the total 400 job positions recruited by ManpowerGroup Vietnam.

Fourthly, the logistics sector. Vietnam's logistics industry has a significant demand for personnel. According to the 2018 Vietnam Logistics White Book, there are approximately 4,000 professional logistics companies, with 54% of them concentrated in Ho Chi Minh City. It is forecasted that by 2030, the logistics sector will need 200,000 professional workers.

Renewable energy is one of the fastest growing sectors in Vietnam. How do you assess the workforce in this sector?

Renewable energy is currently a growing trend in Vietnam. From my perspective, this sector in Vietnam exhibits the following characteristics:

Firstly, the demand for personnel in the renewable energy sector will be significant across various stages, including development, construction, operation, and maintenance. Manufacturing companies will soon have to comply with green standards, especially for export markets (such as the EU). Moreover, many renewable energy projects supported by ManpowerGroup Vietnam are expected to create 45,000 jobs over a period of 20 to 35 years from development to completion.

Secondly, there are positive signs regarding the development of Vietnamese labor in this sector through joint ventures and collaborations between domestic and foreign companies. Local engineers have been transferred new technology and gained direct experience through various joint venture projects, which accumulates valuable expertise for future projects.

However, the workforce in Vietnam's renewable energy sector still faces several limitations. The Vietnamese labor force lacks experience in renewable energy development, resulting in a shortage of high-level personnel. For example, in the wind power sector in Vietnam, individuals with deep technical or high-level management skills are often foreign experts from countries with advanced wind energy technology or are seconded by major players in the industry. This is the result of Vietnamese labor not meeting the requirements for skills and experience in handling large projects.

The percentage of highly skilled workers (11%) is lower compared to countries in the region like Thailand and Japan. Vietnamese workers face challenges in both technical competence and soft skills, including language proficiency. Vietnam has a low percentage of workers with sufficient English proficiency (5%) compared to other Southeast Asian countries.

What should Vietnam do to improve the quality of high-tech personnel and attract international talent to work in Vietnam?

To enhance the quality of high-tech personnel and attract high-quality international talent to work in Vietnam, several actions should be taken.

Firstly, there should be an emphasis on improving soft skills and digital skills for high-tech personnel. According to the " ManpowerGroup Employment Outlook Survey" in Q2/2023, the top five soft skills desired by manufacturing companies in the high-tech sector include critical thinking and analysis, creativity and originality, reasoning and problem-solving, reliability and discipline, and initiative-taking.

Secondly, collaboration among three parties - educational institutions, businesses, and students - is crucial. The focus should be on improving technical skills and work experience for students. ManpowerGroup Vietnam is ready to provide programs for students from universities and colleges nationwide. Since 2008, ManpowerGroup Vietnam has been collaborating with 30 leading universities and colleges in Vietnam to bridge the gap between students and businesses in the technology field.

Lastly, to attract high-quality international talent, there should be an open and friendly cooperation mechanism. According to Decision No. 127/QD-TTg 2021 on the national policy for research, development, and application of artificial intelligence (AI) until 2030 by the Prime Minister, Vietnam aims to become a global center for innovation and AI.

Additionally, Vietnam needs to adjust regulations for granting work permits to foreign workers. Moreover, there should be more exchange, learning, and collaboration projects with foreign countries, similar to what JICA (Japan International Cooperation Agency) has been doing with Vietnam for more than two decades. JICA has not only provided financial assistance but has also sent young Japanese experts to work in Vietnam, which is considered a smart way for Japan to share international experience with Vietnamese specialists.

What criteria do FDI companies use to hire personnel?

Foreign Direct Investment companies look for personnel who meet certain criteria, including:

Firstly, individuals need to possess both soft skills and digital skills. According to a survey by ManpowerGroup Vietnam and the Institute of Labor and Social Affairs (under the Ministry of Labor, War Invalids and Social Affairs), the soft skills desired by FDI companies in the manufacturing sector include analytical thinking, logic and reasoning, creativity, leadership/management skills, and decision-making abilities.

Additionally, workers need to have a learnability mindset to adapt to rapid global changes and the new normal. Digital skills are essential and have gained attention with Decision No. 2222/QD-TTg by the Prime Minister in 2021, which aims to guide digital transformation in vocational education by 2025, with a vision towards 2030.

Secondly, employees need to have strong language skills to serve their work, especially for international projects. As I mentioned earlier, Vietnamese workers do not yet meet the requirements for soft skills in the context of enhanced digitization and integration, including language skills. Workers not only need to improve their English proficiency but also learn other languages such as Japanese, South Korean, or Chinese to be highly regarded by FDI companies.