The country’s labor market in the second quarter is forecasted to face many difficulties

The recovery, as well as the resilience of the labor market, still depends entirely
on the development of the Covid-19 pandemic. 

Industry fluctuations in three main groups

According to data from the General Statistics Office, in the first quarter, the country's labor and employment situation was negatively affected by the Covid-19 outbreak again at the end of January. The estimated quarterly unemployment rate was 2.19%, of which the unemployment rate in urban areas was 2.96% and 1.76% in rural areas. The underemployment rate of working-age workers was estimated at 2.2%, of which the underemployment rate in urban areas was 1.52%; in rural areas it was 2.6%.

Evaluating the labor market picture in 2021, Nguyen Thi Lan Huong, former Director of the Institute of Labor Science and Social Affairs (Ministry of Labor, War Invalids and Social Affairs) said that the labor market still faces difficulties because of the Covid-19 pandemic. In recent years, Vietnam's economy is still on the rise, if it is fueled by a better economic environment, industries that can still grow such as construction and processing can create a big boost. In particular, the Vietnamese labor market will have changes to accommodate the new normal state.

According to Ms. Lan Huong, because our country's exports will continue to be affected, it is necessary to change the labor structure, take advantage of economic achievements to stimulate the affected industries in the country, as well as focusing on the domestic consumer market. It can be predicted that the industry group serving domestic demand is likely to recover at a fast rate. Therefore, there is a high probability that there will be a two-way labor movement, and the demand for high quality labor will increase.

“The recovery, as well as the resilience of the labor market, still depends entirely on the Covid-19 pandemic. Because if this year the Covid-19 pandemic in the world is controlled, the labor market of Vietnam will also recover. In the second quarter, the labor market in some industries such as aviation, import-export, tourism, services, restaurants is still grey picture, there are no bright spots.”

Increasing demand for high-quality labor

Data from Adecco Vietnam (a company specializing in HR solutions) shows that the number of jobs in March increased by 40% compared to January. For the number of applications, the growth was 26%.

According to Ms. Nguyen Thu Ha, Director of Adecco Hanoi Office, there are three reasons why the labor market is gradually recovering.

“The first is a successful attempt by the Government to control and prevent the pandemic. Second, businesses are boosting their business activities with the desire to quickly recover after a period of economic stagnation. Third, in terms of psychology, we are now more proficient in mental health care and dealing with anxiety caused by the pandemic,” said Adecco Hanoi Office Director.

Notably, the situation of labor mobility after the Tet holiday has not increased dramatically as in previous years. Some sectors that witnessed an increase in recruitment demand this quarter include manufacturing engineering, energy, information technology, e-commerce, electronics, semiconductor design, and civil and industrial construction.

“Recently, we are seeing increasing demand for a number of positions such as analog IC design; digital design; inspection engineer, quality manager, senior production manager, technical manager, employee, sales manager and marketing manager. In the future, the combination of a wave of supply chain shifts from China and the positive impact from FTAs will bring many prospects to the Vietnamese economy, leading to job opportunities and the recruitment demand has increased significantly,” said Ms. Nguyen Thi Thu Phuong, Director of Recruitment, Adecco Hanoi.

Evaluating the labor market in 2021, General Director of Adecco Vietnam, Mr. Andree Mangels said that the labor market in 2021, with the recovery of the economy and the global digitalization trend, will bring more opportunities to skilled workers. Stemming from the need for new skills, re-skilling and up-skilling are indispensable moves for every enterprise in the current period.