Survey shows skills shortages threatens business growth

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According a new survey of 1000 enterprises by the Institute of Labour Science and Social Affairs (ILSSA) under the Ministry of Labour, War Invalids and Social Welfare (MoLISA) in cooperation with ManpowerGroup, the shortage of skills of workers was their major obstacle in upgrading or expanding factories in Vietnam

Half of the 1000 enterprises surveyed said about 23 per cent of the workforce lacked the skills businesses needed and 35 per cent could not afford to meet the requirements of the business.

The survey also showed that every second enterprise believes the labour force in Vietnam is not up to scratch and one in three employers said they could not find workers with the necessary skills.

A quarter of enterprises said domestic labour was either unreliable or did not care for the quality of work and lacked communication skills.

Many businesses taking part in surveying said the ability of labour in Vietnam was no longer consistent with the rapid development of the economy. The labour quality was in the bottom 10 per cent lowest of Southeast Asian countries.

In terms of management, there was a lack of general management skills and skills in motivating employees as well as an inability to develop and manage resources. There were problems with poor communications skills, and a lack of knowledge of law, finance, foreign languages and computers.

In fact, low labour cost is one reason there is foreign investment in Vietnam.

According to the results of the ILSSA survey, there are 70 per cent enterprises said this was main reason they considered Vietnam as a good business market.

The Chief Executive Officer of United State Chamber of Commerce in Ho Chi Minh City Herb Kochan said: “There are many U.S. corporations in the service industries and manufacturing sector that have moved their factory from China to Vietnam due to Vietnam’s low labour costs and the business environment [here] is more conducive”.

However, the ManpowerGroup research results also reveal that about 20 per cent of all enterprises said the low skills of the Vietnam workers could slow the development of businesses and this was the main obstacle in attracting investment in Vietnam.

Korea Chamber of Commerce in Ho Chi Minh City Chairman Lee Chon-kin shared: “We want to bring modern machinery to Vietnam but do not recruit a sufficient number of technicians [who] can operate them”.