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Vietnam’s Workforce Needs New Skills for A Continued Economic Modernization, Says Vietnam Development Report 2014

November 29, 2013

Click here to view the full infographic of the Vietnam Development Report 2014

Cognitive, behavioral and technical skills are required for the Vietnamese workers to meet changing demands of employers

Hanoi, November 29, 2013 – Education has played an important role in making Vietnam a development success story over the last twenty years. Vietnam now needs to focus on making its workforce more productive to meet new demands in the transition towards a modern, industrial market economy.

The Vietnam Development Report 2014, titled “Skilling up Vietnam: Preparing the workforce for a modern market economy” and released by the World Bank today, stresses that the nature of work in a modern market economy will change and become more sophisticated. Today, Vietnamese employers are increasingly looking for a mix of higher quality cognitive, behavioral and technical skills.

“Literacy and numeracy among Vietnam’s adult workforce is widespread and more so than in other countries, including wealthier ones, but a more skilled workforce will be key to Vietnam's successful economic transition,” said World Bank Country Director for Vietnam, Ms Victoria Kwakwa.

With the majority of Vietnam’s adult workforce being able to read and write, the challenge now is to turn graduates from good readers into critical thinkers and problem-solvers who are well equipped to acquire technical skills in university, vocational training and throughout their working lives.

The report’s analysis shows that economic modernization involves a shift in labor demand from today’s predominantly manual and elementary jobs towards more skill-intensive non-manual jobs, from jobs that largely involve routine tasks to those with non-routine tasks. And these new types of jobs will require new skills.

According to Christian Bodewig, the report’s lead author, “These new jobs can already be found in today’s labor market, but Vietnam’s employers struggle to find the right workers for them. Equipping its workforce with the right skills will, therefore, be an important part of Vietnam’s effort to accelerate economic growth and further its economic modernization in the coming decade and more.”

Drawing on a survey of employers in urban areas, the report finds that employers identify job-specific technical skills as the most important skill. But they are equally looking for cognitive skills, such as problem-solving and critical thinking, and behavioral skills, such as team work and communication. Reorienting Vietnam’s education system towards focusing more on teaching these types of skills will help Vietnamese workers to prepare themselves for the future – those skills are important in almost any industry. 

The report shows that Vietnam’s education system has a strong track record in producing foundational reading literacy and numeracy skills, but faces greater challenges in producing the advanced skills that will be increasingly demanded in coming years. It advances a three steps plan for a holistic skills strategy for Vietnam:

• Step 1: Promoting school readiness through early childhood development
• Step 2: Building the cognitive and behavioral foundation in general education
• Step 3: Building job-relevant technical skills through a more connected system between employers, students and universities, and vocational schools.

The report urges the government to take actions now, as changes in education and training can take a generation to result in a workforce equipped with the right skills.

“Rather than planning and managing the education and training system centrally and top-down”, says Christian Bodewig, “the role of government is to help to ensure a better information flow between employers, schools and universities and students, and to enhance capacity and set the right incentives by freeing up universities to partner more effectively with businesses”. Ultimately, preparing the workforce for an industrial economy is not just the government’s job. It requires a change in behavior by all actors in skills development – employers, schools and universities and students and their parents alike.

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