Vietnam is one of the most populated countries in Asia, with a population approaching 100 million people. Although the elderly population has been gradually increasing in recent years, the country still enjoys a relatively young population with a median age of 32.5 in 2020. As a result, Vietnam has been benefiting from its labor force, which has contributed to its economic development reflected by its growing GDP.
Employment in Vietnam
Thanks to the economic growth and its positive impact on the availability of jobs, the total number of employed people in Vietnam had been steadily increasing in the past few years, before slightly declining in 2020 due to the impacts of the COVID-19 pandemic. Besides, the Vietnamese government has been investing its human capital by increasing the recurrent expenditure on education and training. Consequently, the country's labor productivity has seen significant improvement in recent years.
As the economy of Vietnam was once highly dependent on agriculture, this sector has been the largest employer in the last decade. On the other hand, as the economy shifts its reliance towards the industry and service sectors, the share of employment by these sectors has been growing at the expense of the agriculture sector. Vietnam has recently emerged as a new manufacturing hub due to its low-cost labor. As a result, the number of people working in manufacturing has been rising year on year, accounting for the second-largest labor force after agriculture. Furthermore, workers in manufacturing earned more than agricultural workers, who received the lowest average monthly salary in Vietnam. The ongoing expansion of the industry and service sectors has also created more job opportunities that offer better compensation, which contributed to the shift in employment in the country.
Impact of COVID-19 pandemic and employment outlook
Before the COVID-19 pandemic, Vietnam had a relatively low unemployment rate of two percent. This rate, however, increased marginally in 2020, shortly after the start of the pandemic. According to a survey conducted in October 2021, over 40 percent of Vietnamese respondents reported having reduced salaries or losing jobs because of the impact of the pandemic. Many enterprises had to lay off employees during this time, which happened most often among micro-and small-sized domestic private companies. The pandemic and its related lockdowns also made working from home the new reality for many people. This new working arrangement was expected to become more widespread post-COVID-19, demanding a higher level of digital readiness from both employers and employees in the country.
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