FIEs seek streamlined workforce policy

In the opinion of the Japan External Trade Organization (JETRO), the quality of Vietnam’s human resources has contributed significantly to the smooth operations of enterprises since the pandemic peak passed.

“Vietnam is doing well in securing human resources and promoting employees. We witness more Vietnamese managers, directors, and executives within Japanese firms,” highlighted Nakajima Takeo, representative of JETRO, at last week’s conference between the prime minister and foreign-invested enterprises (FIEs).

Photo: Duc Thanh

At German tech services supplier Bosch, human capital development and upskilling of the local labour force are decisive factors for the company to develop sustainably, and for Vietnam to stay competitive in luring foreign direct investment (FDI).

Managing director Dominik Meichle said that several months ago the company initiated the Bosch Embedded Academy, which offers 90 training hours in engineering and IT at partner universities, focusing on building student competence with practical industry knowledge and increasing their readiness for the job market.

“We appreciate efforts so far and recommend the government to continue its efforts on vocational education. We are looking forward to preparing the workforce to take full advantage of opportunities brought about by Industry 4.0 and digital transformation,” said Meichle.

Since 2013, Bosch has offered a German-standard programme of Technical Industrial Apprenticeship in collaboration with LILAMA2 and the German Chamber of Commerce and Industry. There have now been nine classes with over 200 students enrolled and 134 graduates, of which 97 per cent continue to work at Bosch.

Elsewhere, aiming to develop Vietnam as an aeroplane manufacturing hub, Boeing is also interested in human resources development. Country director for Vietnam Michael Nguyen said at last month’s forum on aerospace in Hanoi that the company had met with more than 10 universities in the country to discuss cooperation on aerospace research, education, and providing scholarships, as well as technologies.

“Boeing will work with key suppliers to support and welcome local enterprises through training employees, improving skills, technologies, and manufacturing standards to ensure and enhance the quality of products and services of Vietnam’s aviation sector,” said Nguyen.

Meanwhile, in order to shift its business field to further value-oriented and strengthen our competitiveness, one of Panasonic’s critical challenges is a lack of human resources, especially in the IT/AI and design fields.

“Those core areas will decide future competitiveness for both Vietnam and Panasonic, but it’s not enough to realise a drastic increase only by enterprises. So we need the strong support of the government to strategically increase the number of IT and design fields human resources,” said Marukawa Yoichi, managing director of Panasonic Vietnam.

Yoichi suggested developing Vietnam’s future leaders by expanding the number of IT faculties and providing opportunities for programming and other courses. “Panasonic will continue to contribute to children’s educational activities through online seminars,” Yoichi emphasised.

In fact, compared to other countries in the region and over the world, Vietnam still has a low percentage of trained workers at 26.2 per cent (in the second quarter of 2022). In 2015-2020, two-thirds of workers have upper secondary education; 80 per cent of workers in enterprises are vocationally trained (mainly self-trained by companies); 43 per cent of workers are retrained; one-quarter of workers are high-skilled; and more than 7 per cent of workers can speak foreign languages and use computers.

In the view of foreign business associations, there are some issues in managing human resources. Kim Young Chul, vice chairman of the Korean Chamber of Commerce and Industry, is concerned about manpower shortages.

“There has been a case in Vietnam where FIEs collectively attract research and development (R&D) personnel who have been painstakingly nurtured. If this manpower is outflowed, there will be no incentive for FIEs to train R&D manpower or expand it in Vietnam, and there is concern that it will hurt attracting and expanding investment in Vietnam,” explained Chul.

He suggested that Vietnam needs a more open visa policy to become a global tourism powerhouse and attract more FDI.

“The issuance of visa-related documents for those who work or invest in Vietnam is an obstacle to investing because the documents they prepare for obtaining a status of residence in Vietnam are so complex and numerous. If this part is resolved, it is believed that more investment will be attracted to Vietnam,” he added.

Torben Minko, vice chairman of the European Chamber of Commerce and Industry (Eurocham), proposed to extend visas to 30 days for EU countries, which should be added to the list of visa-exempt countries.

“Especially for foreign experts who come to Vietnam for technical support, visa windows should be extended to three or six months. For European high-tech businesses, this is crucial,” Minko said, while adding that simplified work permit procedures are also necessary.

In the opinion of the Ministry of Labour, Invalids, and Social Affairs (MoLISA), Vietnam’s policies on mobilising and managing foreign experts are suitable for international practices.

“Currently, there are over 112,600 foreign employees working in Vietnam. We consider foreigners working in Vietnam as one of the very important factors, providing a skilled labour source to FIEs,” said MoLISA Minister Dao Ngoc Dung. “Our consistent policy is to create favourable conditions for experts, managers, and highly-skilled workers to work in Vietnam for the interests of investors and corporations.”

Minister Dung confirmed that lecturers and high-qualified teachers for short-term teaching do not have to be granted work permits if being confirmed by authorities on education. “In order to recruit employees for managers, experts, and high-tech workers that Vietnam has not yet met and Vietnamese workers cannot apply, FIEs should consider carefully in association with training and employing Vietnamese people, ensuring harmony and efficiency,” said Minister Dung.

He reaffirmed that the ministry has facilitated to grant work permits by authorising provinces’ departments and some industrial zones. The deadline is a maximum of five working days from receiving the dossier, and businesses should get feedback via email if there is something wrong with the dossier, said Minister Dung.

According to the 2019 Labour Code, the work permit period for workers is two years. After this time, they can extend the work permit for the next two years. At the end of these four years, if required, the MoLISA can grant a new one. “Thus, there are no difficulties for foreign experts and there are no barriers for foreign workers to work in Vietnam for several years,” Minister Dung urged.

Vietnam needs skilled workforce to become upper-middle-income economy by 2035: WB Vietnam will need a skilled workforce to transform itself into an upper-middle-income economy by 2035, the World Bank has suggested in its recently-released report named “Taking Stock: Educate to Grow”.

Industries prepare to upskill the workforce With the international labour force shifting to younger demographics, demand for upskilling and professional empowerment is on the rise – but some employers are being slow to adapt.