Labour market offers bizarre paradoxes

VnnNews – Will local workers grasp employment opportunities this year through enterprises’ rebounding demand for labour?

Hanoi Knitting Joint Stock Company, specialised in making assorted socks and stockings, recently began operations at a new location in the capital’s Phu Dien commune. As the firm started operations with a satisfied grin, many of the company’s leadership had frowns on their faces over the grave shortage of workers. Many left the company because they did not want to travel the nine kilometres to the new workplace, despite being paid good salaries.

 

“We may need 50 new workers. But, I am not sure we can succeed,” said Nguyen Tao Tu, a company representative, who had to participate in an employment fair in Hanoi to hunt down workers. The company’s plight was shared by more than 60 local and foreign enterprises attending the fair. They were all in critical need of nearly 2,100 workers for production this year.

 

However, unlike previous fairs where most job-seekers grabbed jobs immediately, many came just to seek information about salaries, working conditions and other benefits. “They [job-seekers] need jobs, but they are choosey and rather indifferent to employers like us,” Tu said.

 

Nguyen Viet Thang, a University of Commerce accounting graduate, said: “I will find new well-paid work after Tet holiday because it is the time when demand for workers increases and employers will compete with one another to attract workers.” Thang, now working for a private computer company, said he came to the employment fair to find another job with a higher salary near his home.

 

“Some enterprises have offered me a monthly salary of VND2 million ($108.1), but their locations are far from my house,” he said. Thang’s opinion surprised many employee-hunters like Tu. According to the Hanoi Job Promotion Centre, between late 2008 and mid 2009 when the economic downturn forced many enterprises to cut workers, many labourers grabbed jobs at any price.

 

At present, however, with the ongoing economic recovery that is prompting many enterprises to resume and expand their production, they are finding it difficult to find workers. Nissei Electric Vietnam Company in Ho Chi Minh City-based Linh Trung Export Processing Zone is also anxious to find an extra 600 workers to fulfill its increasing orders.

 

“We have had to travel to other provinces to recruit workers. But, the provinces also have industrial parks that attract locals as people do not want to go far to work,” said Le Khanh, a representative of the company.

 

In another case, Ho Chi Minh City-based Proking Tex Vietnam Company lacks 1,000 workers. The company offered a reward of VND250,000 ($13.5) to anyone that helped the company find a worker who could sew and work for the company for three months. A VND500,000 ($27) reward was offered if a new employee agreed to work there for six months and the highest reward of VND1 million ($54) would go to anyone fetching a skilled worker.

 

“Recruitment conditions are easy, even those who do not know how to sew can be recruited, but only few workers have been found,” said Tran Thi Phuong Thao, chairwoman of the company’s trade union.

 

Phan Thanh Phi, head of Long An Provincial Industrial Park Management Authority, said all enterprises in the province were short of workers, though the authority and the enterprises had taken great pains to look for workers.

 

“For example, it took quite a long time for shoe and bag-makers like Taiwanese-backed Ching Luh Company and South Korean-backed Simone company to just find half of their needed workers,” Phi said.

 

Continued labour shortages

 

At present, Vietnam has 47.25 million employed labourers, of whom 47.7, 21.5 and 30.8 per cent are working in the agriculture-forestry and fisheries, industry and construction, and service sectors respectively.

 

Deputy minister of Labour, Invalids and Social Affairs (MoLISA) Nguyen Thanh Hoa said Vietnam’s labour market had too many unskilled workers.

 

“While there are too many unskilled unemployed labourers and a grave shortage of technical labourers, many enterprises, mostly in southern Vietnam, are having difficulty in finding both skilled and unskilled labourers,” Hoa said. Some 65.25 per cent of the country’s total workforce is unskilled. Some 78 per cent of Vietnamese people aged 20-24 are either untrained or skill-strapped.

 

Of Vietnam’s employment vacancies in 2009, some 80 per cent were for unskilled labourers, who were needed for the garment, textile, footwear and agro-forestry processing sectors. “But, nationwide job promotion centres can only meet 20 per cent of enterprises’ demand for workers,” Hoa said.

 

According to a Molisa report, southern Dong Nai province lacks 20,000 labourers each year, one-fourth of whom are trained labourers and the rest are unskilled. Similarly, southern Binh Duong, Vinh Long and Ba Ria-Vung Tau provinces are forecast to lack 41,600, 3,000 and 5,000 labourers respectively, while in the Mekong Delta’s Can Tho city, the number is more than 5,200.

 

The MoLISA ascribed the country’s labour market imbalance to a high birth rate in rural areas hit by socio-economic difficulties. Meanwhile, in urban areas home to industrial and service development, the birth rate is lower and has resulted in a dearth of labourers. As a result, unskilled rural labourers rushed to cities to seek employment, putting cities under big employment generation challenges.

 

Moreover, while northern Vietnam often sees redundancies, southern Vietnam, where more industrial factories are located, often lack labourers. But, workers from the north do not want to go to the south because the salaries offered fall short of expectations. Besides, the imbalance is also attributed to big differences in salaries amongst enterprises and regions.

 

“Reality shows that salaries offered by many enterprises are lower than incomes of freelance labourers. While the minimum salary level is VND50,700 ($2.74) per day in enterprises, freelance labourers, in many cases can earn VND80-100,000 ($4.32-$5.4) per day without being managed and having technical skills,” said Nguyen Tao Chuyen, deputy director of Hanoi-based NTC Joint Stock Company.

 

The National Assembly’s Economic Committee attributed the imbalance to Vietnam’s haphazard education structure. “Universities, colleges and vocational schools are teaching what they have, not what enterprises and the society need. Many subjects are impractical and inapplicable,” said the committee chairman Phung Quoc Hien.

 

2010’s labour market prospects

 

At a recent seminar on Vietnam’s 2010 economic prospects jointly held by VIR and the Ministry of Planning and Investment’s National Centre for Socio-Economic Information and Forecast (NCSEIF), the latter’s director Le Dinh An said Vietnam’s economy would possibly grow by 6.5-7 per cent in 2010, higher than 2009’s 5.32 per cent. This also means that enterprises’ demand for labourers will also rebound.

 

According to Ho Chi Minh City Centre of Forecasting Manpower Demand and Labour Market Information, the southern hub will need around 280,000 workers in 2010’s first quarter. In which the garment and footwear sectors will account for 18.7 per cent of the demand. The administration, construction, transport, tourism, mechanics, healthcare and electricity sectors would also witness high labour demand throughout 2010.

 

“Demand for labourers will increase because the local economy is forecast to gradually to recover,” said the centre’s director Tran Anh Tuan. Tien Giang Provincial Industrial Park Management authority said this southern province needed 2,000 new skilled workers, while in Vinh Long province enterprises would need 7,000-8,000 new workers in 2010.

 

According to reports by six state-owned groups and corporations – Vinashin, PetroVietnam, Vietnam Steel Corporation, Vietnam Paper Corporation, Lilama and Vietnam Railway Corporation, their total demand for labourers between 2008-2012 will be 90,000, including 24,000 skilled workers.

 

For example, the number of workers in the country’s oil and gas sector is expected to increase from 2009’s 26,200 to 27,500 in 2010, 28,700 in 2011 and 33,700 in 2015. Meanwhile, Lilama said it would need 2,500 skilled workers in 2010, 2,780 in 2011 and the figure would increase to 4,500 in 2015.

 

To meet Vietnam’s industrialisation strategy by 2020, the MoLISA is working on the plans that 24.58 million local workers will receive proper training in the next decade. The plans are estimated to cost $2.21 billion.

 

At present, recruitment banners are hung everywhere in industrial parks and export processing zones, announcing recruitment of unlimited numbers of workers, highlighting welfare policies and enrolment rewards to attract workers.

 

However, Chuyen said that enterprises should pay great attention to policies related to welfare, salaries and working conditions to keep their employees. “Low salaries will continue being one of the major causes behind the paradox that while enterprises lack workers, there are too many jobless people,” he said.

 

VietNamNet/VIR

 

Tags: Chi Minh City, Demand For Labourers, Ho Chi Minh, Ho Chi Minh City, Labour Market, Many Enterprises, Of The Company, Per Cent, The Company, Physics games

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