Vietnam’s Labor Market Faces Training Deficiencies, Says Ministry

 Vietnam's labor market continues to be hindered by a lack of formal vocational education, with over 37 million workers lacking specialized training beyond primary vocational levels, according to the Ministry of Labor, Invalids, and Social Affairs (MOLISA). This gap in skills impedes the country's ability to fully meet the demands of a modern and integrated workforce.

Labor Market Recovery and Wage Reforms

In 2024, MOLISA reported a 6% average increase in minimum wages as part of efforts to overhaul salary policies in businesses. Industrial relations have remained stable, with greater emphasis on dialogue and collective bargaining.


Workers' living standards have improved, with average wages and incomes rising by approximately VND 1.9 million (USD 78) compared to 2020. Labor markets in industrial zones and major economic areas have also stabilized, aided by recovery initiatives following the COVID-19 pandemic.

According to the General Statistics Office, the labor market has largely rebounded to pre-pandemic conditions in 2024. However, MOLISA noted that the labor supply was severely disrupted between 2021 and 2024 due to the pandemic, resulting in widespread job losses, shorter working hours, and a significant drop in employment rates.

To counteract these effects, the government introduced various programs to bring migrant workers back to cities and launched initiatives aimed at stabilizing and growing the labor market by 2030.

Ongoing Challenges

Despite the recovery, significant labor shortages persist, particularly in industrial zones and export processing areas, with sectors like textiles and electronics assembly being the most affected. MOLISA's survey pointed out that these shortages are mainly due to increased demand during peak holiday seasons and the lack of proactive labor recruitment strategies.

The unmet demand is mostly for unskilled labor, while informal employment continues to dominate, making up 64.6% of total employment in the first nine months of 2024—a slight decline from the previous year. This reliance on informal work highlights the labor market's instability and the need for more sustainable development strategies.

The quality of the labor force remains a major obstacle, with only 28.1% of workers having received formal training and certification. This leaves a large portion of the workforce ill-equipped for the challenges of a rapidly evolving and interconnected global economy.

Vietnam’s labor market faces significant challenges due to a shortage of formal vocational training, with over 37 million workers lacking specialized education, hindering the nation's ability to meet the needs of a modern economy. Despite efforts to improve wages and industrial relations, and a recovery from pandemic disruptions, there are persistent labor shortages in key sectors like textiles and electronics. Informal employment remains high, and only 28.1% of the workforce has formal training, limiting Vietnam Manpower capacity to compete in a dynamic, global market.

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