FDI firms face dilemma of unskilled local workforce

According to a recent survey conducted by the Ministry of Labor, Invalids and Social Affairs on the skills of Vietnamese workforce, 25 percent of the participating businesses said the local workforce was not trustworthy, failed to pay adequate attention to the work quality, and lacked communication skills.

Half of the responding businesses said 23 percent of Vietnamese laborers did not have the skills they required, and 35 percent failed to meet their requirements.

The survey also demonstrated that training for the local workforce had lagged behind the rapid growth of the economy.

The survey, polling 1,000 businesses in six major cities and provinces countrywide, was co-conducted by workforce solution provider Manpower Group.

Manpower Chairman David Arkless said Vietnam was seeing a much more serious lack of necessary skills in its workforce than do China and India -- the regional biggest economies.

“Vietnam does not have many well-trained employees for both simple jobs and sophisticated professions that require higher levels of skills such as managers and engineers,” he said.

Laborers in the food processing, public health, construction, logistics and chemical sectors had poor professional and technical knowledge, he said.

In terms of its managerial capability, he added, Vietnamese workforce also lacked management and interpersonal skills as well as legal and financial knowledge.

“Most Vietnamese workers have also neglected certain skills such as foreign languages, creativity, and informatics.”

According to a survey by the Institute of Labor Science and Social Affairs, the low-cost workforce of Vietnam still remains the most appealing factor to foreign investors.

Herb Kochan, executive director of the American Chamber of Commerce in Vietnam, said many US enterprises operating in the services and manufacturing sectors had relocated their plants from China to Vietnam because of the latter’s better business environment and lower labor costs.

However, as the survey by Manpower shows, despite the labor cost advantage, the poor skills of the workforce can seriously slow down the country’s growth rate and discourage foreign investment.

One fifth of the respondent businesses in the survey said Vietnamese laborers lacked basic knowledge about work safety and the ability to adopt new technology.

Arkless of Manpower said the inadequate skills would prove to be the main obstacle for Vietnam to increase its competitiveness in the global economy.

“Vietnam has an abundant labor force who can handle basic work in the agricultural sector or in the production line,” he said.

“But the country lacks a force of well-trained laborers.”

Sharing this viewpoint, Lee Chon-kin, Chairman of the Korean Chamber of Commerce and Industry in Ho Chi Minh City, said the shortage of a qualified workforce was one of the main causes that had prevented many Korean businesses from upgrading their plants and expanding their operation in Vietnam.

“We wanted to transfer some modern machinery to Vietnam but failed to find skilled workers to operate them,” Lee said.