Vietnam’s labor productivity grew fastest in Southeast Asia in two recent decades, according to a survey released this week by a UK organization.
“Economic Insight: Southeast Asia” found the country's workforce productivity expanded 184 percent during the 1991-2012 period and the number of high-skilled workers also increased.
The survey is published by Cebr, the partner and expert in global economic forecasting of the Institute of Chartered Accountants in England and Wales (ICAEW), which promotes, develops and supports more than 144,000 chartered accountants worldwide.
It focuses on Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam, considering them the largest economies of the regional bloc.
The productivity growth of Vietnam, the poorest in the group, is described as “remarkable” as it is more than double those of other countries.
Vietnam also has the highest increase in the ratio between skilled and unskilled workers, 76 percent between 2001 and 2012, showing a transition from an agrarian to a manufacturing-based economy.
Education and training
But according to the report, Vietnam still has a lot to do about its education to make sure it provides the “requisite” skills such as engineering, science and programming.
Vietnam currently competes on cost but that will only secure investors for the near future, it said.
The “natural” next step is to develop skills that match the needs of the economy.
It said that although the foundation-level education in Vietnam is strong, the government has not focused on skills development, leaving a significant mismatch between what is trained and what is needed.
The country “has serious need for reform in education,” it said.
A 2013 survey by the International Labor Organization (ILO) showed that labor productivity in Vietnam was among the lowest in the Asia-Pacific region.
It found that Singaporean productivity was nearly 15 times that of Vietnam’s, while Japan’s was 11 times higher and South Korean 10 times higher.
Vietnam’s productivity was just one-fifth of Malaysia’s, and two-fifths that of Thailand, according to ILO study.