Recently, former Vice President Nguyen Thi Binh posed the question: Why is Vietnam’s labor productivity only 1/15 of Singapore’s? How do we feel about this?
Following this, former Deputy Prime Minister, Professor Tran Phuong, explained that this is due to a mismatch between the supply and demand in Vietnam’s human resource training process, which is not aligned in many areas.
Vietnam Education Online had a conversation with Mr. Tran Duc Canh, former Director of Training and Human Resource Development in Massachusetts, USA.
Leveraging Interests and Labor Abilities
Interviewer: Discussing the development of human resources, Professor Tran Phuong mentioned the current mismatch between supply and demand, which has left many graduates unemployed or underemployed. What is your opinion on this statement?
Mr. Tran Duc Canh: The mismatch between trained human resources and job demands exists in every country, but in Vietnam, this mismatch is significant and systemic, requiring macro-level solutions first.

Mr. Tran Duc Canh, former Director of Training and Human Resource Development in Massachusetts, USA.

To help address this mismatch, I believe the two most urgent issues in the current education and training system are: First, creating a more systematic and scientific connection with economic and social development needs. Second, fully leveraging individual talents, interests, and creativity to unlock potential. An education system that imposes rigid doctrines will stifle talent, if not eliminate it entirely at an early stage. In labor economics, unemployment is classified into three types: First, unemployment caused by economic conditions at different times (cyclical unemployment). Second, seasonal work (seasonal unemployment). Third, unemployment due to not meeting job requirements (structural unemployment), which is the type of mismatch we’re discussing, and it is the hardest to resolve, requiring time for training or retraining. I often joke with my colleagues in education that if I were to open a school in Vietnam, it would be a “University Retraining School” because I’m certain there would be a large demand for it.

In your opinion, which agency should be responsible for better connecting supply and demand to avoid labor waste, and how should it be done, based on your management experience?
Mr. Tran Duc Canh: I want to talk about a National Human Resource Training and Development Plan closely linked to economic and social development plans over 5 to 20 years, and even longer-term. To implement this plan, thorough and scientific research and assessments are required, with broad consensus in policies and development plans for the economy and training sectors. Training institutions and centers can refer to these studies and reports for their training planning. I think Vietnam is currently very lacking and weak in this area, leading to a significant mismatch between supply and demand.
Due to the complex and comprehensive nature of this work, I believe this responsibility should be assigned to a National Council for “Human Resource Training and Development Planning,” consisting of representatives from relevant ministries, organizations, businesses, and reputable individuals, rather than one or two supervisory ministries. A similar setup is very common in many countries. The human resource issue in Vietnam is, I think, even more urgent.
One reason could be that we accept the market mechanism, allowing universities to compete on quality, increase student enrollment, but with little control over the output. Do you think this is the main reason for the supply-demand mismatch?
Mr. Tran Duc Canh: The human resource training and development model must be built on the market mechanism. We talk about the market mechanism for input, with schools competing with each other, but what about the output? Output requirements are the determining factor in the quality and scale of training.
However, the current way of selecting and utilizing graduates is still halfway; some jobs do not truly require proof of actual abilities, relying instead on connections and other factors, which distorts the goals and quality of training. To resolve this, we must reform the way we use graduates, and this is very difficult.
Private enterprises, if they want to survive and develop, must use human resources as efficiently as possible, so issues like academic dishonesty or fake degrees rarely happen in private companies. According to market principles, over time, the system will eliminate what does not meet value requirements. The state should have specific policies to make the labor market flow faster, healthier, and more efficiently, through transparency and fairness.
Vietnam’s Labor Productivity Lags in the Region
Do you think it is necessary to have a comprehensive assessment and review of higher education, human resource development to get an overall view before making any training or market demand directions?
Mr. Tran Duc Canh: According to the latest report from the International Labor Organization (ILO), Vietnam’s labor productivity is only 1/15 of Singapore’s, 1/10 of South Korea’s, and 1/5 of Malaysia’s. This comparison is based on average labor productivity between countries, but what about comparing the productivity of Vietnamese workers working in South Korea or Malaysia? No South Korean company would pay a Vietnamese worker five times more, or Malaysia three times more or higher than domestic wages, if the productivity of Vietnamese workers were as low as reported.
If everything were equal, the labor productivity of Vietnamese workers would not be much lower than that of South Korean or Malaysian workers. The significant difference here is likely due to the environment, the operation of the socio-economic system: policies, infrastructure structure (both hard and soft), investment efficiency, business management thinking, technical application, etc.
If we only focus on the low quality of Vietnam’s human resources without considering the above factors, which directly or indirectly affect labor productivity, we will not solve the labor productivity problem effectively. If Vietnam can restructure the socio-economic system, quickly shift from an agricultural to an industrial and service economy, and improve labor productivity, it may catch up with Malaysia, Thailand, or China in the near future.
Source: http://giaoduc.net.vn/Giao-duc-24h/Nang-suat-lao-dong-thap-loi-khong-phai-cua-nguoi-lam-post154028.gd