Lê Minh Quốc - Opportunies and Challenges to Vietnamese Labor Forces When Joining Aec

8/19/2019 Lê Minh Quốc - Opportunies and Challenges to Vietnamese Labor Forces When Joining Aec

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Opportunities & Challenges for HUFLIT Students When Joining AEC

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ABSTRACT

Many borderless economic communities have been established due to world’s integration

and cooperation tendency. ASEAN Economic Community is a good example for this

tendency in Asia, which brings a lot of benefits as well as difficulties to every nation in

the community. The author’s purpose of writing this paper is to inform business owners,

laborers, and especially students about opportunities and challenges for Vietnamese

economy on labor forces. Through analyzing statistics of surveys conducted on HUFLIT

students, the author hopefully provides targeted readers useful information. Opportunities

and strong points stated in this paper should be effectively taken advantage. On the other

hand, judgement on laborers’ shortcoming by experts should be considered. Besides, this

paper also indicates worth - reading recommendations for challenges and weaknesses on

the aforementioned aspect.


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Table of Contents

ABSTRACT .................................................................................................................. 1

INTRODUCTION ........................................................................................................ 3

LITERATURE REVIEW ............................................................................................ 5

I. AEC Background. ............................................................................................... 5

II. Labor forces. ....................................................................................................... 6

1. Opportunities. .................................................................................................. 6

2. Challenges. ....................................................................................................... 7

RESEARCH METHODLOGY .................................................................................... 8

RESULTS .................................................................................................................... 10

DISCUSSION .............................................................................................................. 12

CONCLUSION............................................................................................................ 16

REFERENCE .............................................................................................................. 22


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CHAPTER I

INTRODUCTION

As the future trend in the economic development, countries tend to connect with

others to mutually help grow the economy nationwide and worldwide, which is called

globalization. Many cooperation organizations among nations which share similar

geographic, historic, and cultural features as well as economic targets have been

established, such as WTO, EU, and APEC, etc. Established in 1967, the Association of

Southeast Asian Nations (ASEAN) is one of these typical organizations which plans to set

up an ASEAN Economic Community (AEC) in 2015. It is a potential chance to promote

cooperation and friendship between nations in this community including Vietnam.

However, it turns out to be a concern that the information of AEC is not caught up by

Vietnam laborers, especially university students.

Joining AEC is a new opening for Vietnam’s workers to get benefits in the

environment of other member nations and the world. In her paper, Angsuthanasombat

(2007) judged that “employers prefer Vietnamese workers as they are hard-working, active,

intelligent, open and skillful and are always ready to do extra work.”. Nevertheless,

together with opportunities accompany substantial challenges for Vietnamese business -

especially workforce due to the competition of other member nations. On 9 May 2014, the

Organization International Labor (ILO) reported that Vietnamese labor capacity was

ranked as one of the poorest compared to other Asia Pacific countries. (Bui, 2014)


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The research process is carried out in the scenario that there is a considerable lack

of crucial information regards to the related fields from Vietnamese authors. In addition,

the findings of this study are carried out on students of the Department of Foreign

Languages of Ho Chi Minh City University of Foreign Languages and Information

Technology (HUFLIT) since the start of the school year. Thus, the results cannot

thoroughly indicate the future laborers’ knowledge of Vietnamese economic status quo.

This study aims to raise awareness and attention of the youth laborers, especially

educated class, of the basic knowledge about how AEC affects Vietnamese rapidly

changing economy. Opportunities and challenges of Vietnam’s labor forces are

particularly emphasized in order that university students can get an overview about what

is expected to happen in the upcoming year 2016.

This research paper opens with an introduction about the ASEAN Economic

Community (AEC). It then goes on to literature review which includes some outstanding

research on related field by some previous authors. The next chapter presents how this

research was conducted. After outlining the research results and discussion, the article

concludes with some main points and needs for further studies.


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CHAPTER II

LITERATURE REVIEW

I. AEC Background.

Established in 1967 originally due to the political and regional security demands,

ASEAN has gradually centralized the economic target since the first ASEAN Summit in

1976. The immediate aim of member nations is to establish the ASEAN Community in

2020 so – called ASEAN Vision 2020. To fulfil this goal, the three pillars – ASEAN

Economic Community (AEC), ASEAN Political – Security Community (APSC), and

ASEAN Socio – Cultural Community (ASCC) – were also decided to be set up and

accomplished by 2020. Particularly, AEC was directed to be launched in December 2015

as an initial step on the way to ASEAN Community.

The AEC Blueprint was drafted to assure that the plan could smoothly run within

time allotted. It aimed to draw up a future image of a potential community with basic

characteristics. They are “a single market and production base, a highly competitive

economic region, a region of equitable economic development, and a region fully

integrated into the global economy”. (ASEAN Secretariat, 2008:6)

The first characteristic, a single market and production base, would create an

equally extensive chance for every single country in AEC to promote mutual trade. This

section comprises 5 key factors: “free flow of goods; free flow of services; free flow of

investment; freer flow of capital; and free flow of skilled labor .” (ASEAN Secretariat,

2008:6)

Free flow of skilled labor is chosen to be analyzed in this paper to find out

opportunities and challenges toward Vietnam’s economy in the human resource aspect.


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II. Labor forces.

Joining AEC causes many problems for labor forces of members and Vietnam is no

exception. Opportunities and challenges await Vietnam’s labor on the way to AEC

establishment at the end of 2015. With the key term “free flow of skilled labor” apparently

stated in AEC Blueprint, it means that labor from the 10 countries can independently and

freely move to other countries in the community to work. Vietnam’s labor forces should

be prepared to face the inevitably upcoming situation.

1. Opportunities.

a. Widen job opportunities.

Vietnam is a country with many advantages in the competition of work force. In

Bui’s article (2014), she said that “compared to other ASEAN countries, Vietnam

possesses young and cheap labor forces. On the basis of MRAs (Mutual Recognition

Arrangements), Vietnamese employees can move and find a job more freely around other

ASEAN countries.” These are Vietnam’s labor forces’ competitive edges when all AEC

members integrate into an independent single market.

b.

Reducing gaps.

The disparity between the ASEAN – 6 and CLMV countries is still a burning

question for many economic experts. The question is that how CLMV countries could

catch up with the development level of the ASEAN – 6. AEC is one of the factors that

helps reduce the gaps among nations in the community. By exchanging laborers, every

nation’s economy would rise at the same pace. Free migration of labor forces also implies

the free “migration” of technology, knowledge, working methods, etc. In this current

context, Vietnam plays a role as a country which receives benefits from the ASEAN – 6

to catch up with their development levels. (Nguyen, 2013:5)


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2. Challenges.

a.

Skill deficiency.

Prof., Dr. Nguyen Thi Ngoc Huyen and Prof., Dr. Bui Anh Tuan (2004) in their

research paper discovered that:Vietnam has abundant human resource (of close to 40 million people), but proportion of skilled labors is still very low (21% of the total labor forces). In thelabor market, therefore, there exists a paradox: labor supply is high, meanwhileenterprises are lacking skilled labors, especially technical workers, marketing,designing and financial specialists, and business administrators.

As a result, many enterprises in AEC may hesitate when employing Vietnamese

workers because of their lack of skills and working experiences. When hiring those who

are unskilled, employers have to train their fresh employees to assure that those workers

would help companies earn profits. The process of training fresh personnel usually costs

as much as a full – year – salary of an employee in general.

b. Brain draining.

“ASEAN members can be broadly divided into net sending and net receiving

countries for labor: Cambodia, Lao Democratic People’s Republic, Myanmar, Indonesia,

Vietnam and the Philippines are net senders; Singapore, Thailand, Malaysia and Brunei

Darussalam are net receivers.” (Huelser and Heal, 2014, p.2)

c. Impractical education.

Although many educational reforms have been applied, Vietnam’s education

quality is still a roadblock on the way to global and regional integration of Vietnam. Phu

and Jun (2013:171) considered that Vietnam’s education fall into a severe crisis, especiallyin higher education and, moreover, unrealistic.


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CHAPTER III

RESEARCH METHODLOGY

The evaluating criterion is based on the comprehensive understanding of future

laborers about AEC. Due to the limit of time and support conditions, only surveys and

interviews (direct & indirect) are applied in this research.

100 students randomly selected from Department of Foreign Languages were provided with sheets of questions. The content is about basic knowledge about AEC. The

questionnaire aims to measure HUFLIT students' interest level in the update news of the

upcoming AEC.

Direct interviews were conducted on the two selected professors from Department

of Foreign Languages and Department of International Business Administration in orderto get objective feedbacks about students and graduates from HUFLIT within 10 years till

now. The two selected professors are considered as great track – keepers on HUFLIT’s

students’ two main criterions: specialism and professionalism. Indirect interviews are the

statements share mostly by economic experts on direct interviews on FBNC News and

Vietnam’s National News Program.

To measure knowledge about AEC as well as to make the data more reliable, a brief

questionnaire was administered in the period of 4 weeks. The 9 questions included in the

survey are objectively classified into 3 categories: Basic knowledge (4 multiple – choice

questions), Personal views of Vietnamese labor forces (1 rating scale question), Self –


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evaluated questions (3 open – ended questions). The questionnaire was composed in

Vietnamese so as that the content is understandable to the participants surveyed.

The interviews consist of 2 open - ended questions to mainly evaluate HUFLIT

students' competitive strength and ask for advices.

Surveys and direct interviews were carried out in early November, when there were

only 2 months left before the establishment of AEC. The results were then recorded and

analyzed using Microsoft Excel.


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The pie chart reflects the self – evaluation of the future work forces. They obviously

assumed that most workers could adapt to the current changing working environment.

Over a half number of students surveyed (68%) had a very positive point of view about

Vietnamese laborers whereas a quarter of the students (24%) were suspicious about their

competence. Laboring discipline and team – working skills are the two worst criterions of

Vietnamese workers. All agreed that Vietnam is not a complete industrial country, so

laborers still follow the agricultural working manner, which is not professional and

effective.

Good

8%

Equitable Jobs

Requirements

68%

Under Jobs

Requirements

24%

Figure 2: Self - Evaluation


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CHAPTER V

DISCUSSION

This research attempted to evaluate two main aspects – opportunities and challenges

for HUFLIT students when Vietnam joins AEC in late 2015. Some solutions for the

weaknesses were also drawn from the findings.

It is obvious in the graph 1 that the number of students who do not care about the

future of integration of Vietnam is really considerable. The reasons for this critical

circumstance may be the ignorance of students as well as the impact of the old – fashioned

education system. Little information of the community was comprised in lessons in order

to make students focus on preparation to confidently face the immediate challenges. It is

also a sign that AEC details should be included in the curriculum of schools and

universities.

As in the interview, Ms. Tran Lan Anh, HUFLIT’s Department of International

Business Administration’s lecturer, shared one of the weaknesses of HUFLIT students is

that they were misled and did not orient a clear path for their future. It also means that the

students do not keep up with the world and region’s rapid changes. In fact, the most

effective way to determine the future paths is to base on the trend of the region or the

prediction of some potential professions. In this circumstance, it is the future trend of

regional integration. Students can actively get themselves ready for the future

opportunities.


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To sum up this section, there are an opportunity and a challenge to be focused.

Because of the advantage in foreign languages, HUFLIT students can easily approach the

update information about new changes in region as well as in the world. However, it turns

out to be a challenge accompanying the previous good point. Students, in general, are not

proactive in updating knowledge and preparing skills in advance in order to grasp chances.

One possible explanation may be students’ ignorance of social activities. The more they

dedicate themselves to social activities, the more updated information they get.

As regards to the quality of Vietnamese labor forces, many evaluation opinions

were given, which were especially controversial. Students considered themselves and

labor forces as almost above average of jobs requirements as which can clearly be seen in

graph 2. Over three quarters of students surveyed claimed that Vietnam laborers can meet

the jobs requirements and can perform well in highly skilled work.

One positive comment by Ms. Tran was that HUFLIT students, the future labor

forces, are knowledgeable, sharp – witted, innovative, good at English communication,

familiar with high technology. These are strength that HUFLIT students should prove.

Nevertheless, absolutely opposite opinions were brought out by economic experts.

Ms. Pham Chi Lan, an economic expert, in an interview with FBNC News said that

there is a paradox in the correlation of the productivity of Vietnamese laborers and the

continuous increase in salary. Workers claim that they do not get the motivation to work

with the currently low salaries. The uncontrollable increase of salary makes the ‘cheap

laborer resource’ ‘not cheap’ anymore. These form an unsolvable circle for the government.

She added that there is unreasonable to raise salary without consideration because the low

salary is based on the low productivity. It implied that Vietnamese laborers have not been


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professional. They do not focus on developing themselves and gaining companies’ profits.

On contrary, they frequently ask for salary raise which they do not deserve to receive. It

also reflects the individualism over teamwork spirit of Vietnamese workers.

In particular, Ms. Tran added that HUFLIT students’ skills in presentation,

teamwork and flexibility have met the general requirements of the international working

environment. This judgement was agreed by Ms. Tran My Uyen, a senior lecturer of

HUFLIT’s Department of Foreign Languages. She said that HUFLIT students’

development was not high enough to catch up with the global change pace and meet the

demands of the society.

Mr. Vu Quang Tho, Director of Labor & Trade Union of Vietnam’s General

Confederation of Labor, said that there are two main factors directly contributing to

Vietnamese laborers’ low productivity. One reason is that workers lose their enthusiasm

and eagerness due to the low salaries. There is no motivation for the workers if they do not

get paid as well as they expected. Another cause is the unsuitability of the new working

pace to the Vietnamese physical constitution. The new technology requires the high

working pace that cannot be met by the Vietnamese laborers.

There are many problems needed to be solved with regard to the lack of skilled

labors of Vietnamese labor forces’ reality. High schools and higher education need

innovative changes in order that more students are trained to meet the requirements of

AEC. The curriculum should focus on applied knowledge as well as essential skills at work

pursuantly to the current situation. Business owners also ought to facilitate more

scholarships for students to study abroad in order that they can be trained more


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professionally and earn profits for employers in return. Capannelli (2014:23)

recommended that:

In general, ASEAN economies need to strengthen their education and training

systems to improve matching between labor supply and demand, especiallyof skilled labor, at national and regional level. Reforms are needed to improvethe overall quality of education and to increase the number and quality oftechnical and vocational schools.

The teachers interviewed shared that the correlation between the syllabus in

universities and the demands of the socio – economy should be formed. Soft skills were

mentioned as the top priorities that students should pay attention to. Besides, it is crucial

to train them with business morale, ethics and professionalism in order that they can easily

get accustomed to the new working environment.


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CHAPTER VI

CONCLUSION

As stated in the beginning of this paper, universities students are not aware of what

is coming in the late of 2015. They also cannot objectively evaluate themselves as well as

Vietnamese labor forces, either. The findings have proved that the hypothesis is true. The

students after the survey showed that they do not know much about AEC. Moreover, the

results of self-evaluation by them appears to be contradictory to some of Vietnamese

economic experts’. One possible conclusion is that the students have few chance to expose

to the real working environment and the modern education environment which focuses on

international mindset. Many possible solutions were pointed out in the previous chapter.

This research has taken a deep step in analyzing how much AEC affects labor

forces. It also reveals the weaknesses to be paid attention. Nevertheless, the research was

conducted in the shortage of time and subjects. This leads to the situation that the results

did not comprehensively demonstrate the strengths and weaknesses of workers.

More studies should be done on a wide range of subjects in order that the results

could be more reliable and effectively interpreted. In addition, more precise and helpful

recommendations could also be draw out based on the further information. Longitudinal

research is suggested to be conducted so as to produce some annual reports for Vietnam

laborers to learn from these precious experience.


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APPENDIX

Appendix 1: Table of questions

BẢNG CÂU HỎI KHẢO SA ́ TÝ KIẾN SINH VIÊN HUFLIT VỀ AEC.

1. Anh (chị) đã từng nghe về AEC?A. Đã nghe qua và hiểu rất rõ về tổ chức này.

B. Đã từng nghe qua nhưng chưa tìm hiểu.

C. Chưa bao giờ nghe đến tổ chức này.

2. Thời gian thành lập?

A. 01/12/2014 B. 31/12/2014

C. 01/12/2015 D. 31/12/2015

3. Có bao nhiêu nước tham gia tổ chức này?

A. 5 nước sáng lập ASEAN B. 11 nước nước ĐôngNam ÁC. 10 nước thuộc khối ASEAN D. 10 nước ASEAN và Nhật Bản, Hàn Quốc

4. Điểm mới trong tổ chức này?(Chọn nhiều đáp án)

A. Tự do lưu thông tiền tệ. B. Tự do lưu thông nguồn lao động.

C. Tự do lưu thông hàng hóa. D. Tự do lưu thông dịch vụ.

E. Tự do lưu thông vốn đầu tư. F. Tự do chuyển quốc tịch.

5. Có bao nhiêu lĩnh vực/ngành nghề sẽ được tư do lưu thông làm việc trong AEC?

A. 4 B. 5 C. 6 D. 7 E. 8


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6. Anh (chị) nhận xét gì về nguồn lao động Việt Nam hiện nay?

Các tiêu chí về lao động trí thức Việt Nam Tốt ĐạtChưađạt

Kém

1 Trình độ chuyên môn, kỹ thuật

2 Kỷ luật lao động3 Kỹ năng giao tiếp

4 Kỹ năng làm việc công sở

5 Khả năng làm việc độc lập

6 Khả năng làm việc theo đội, nhóm

7 Ngoại ngữ

8 Tin học văn phòng

7. Anh (chị) xem AEC là cơ hội hay thách thức cho riêng anh (chị)?

A. Cơ hội B. Thách thức C. Cả A và B

8. Theo anh (chị), điều gì cần thiết nhất cho sinh viên HUFLIT khi hội nhập AEC?

9. Lợi thế và hạn chế của sinh viên HUFLIT khi gia nhập AEC?

Lợi thế: ............................................................................................................................

Hạn chế: ..........................................................................................................................


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English version

Questionnaire to Measure HUFLIT Students’Awareness of AEC.

1. Have you ever heard about AEC?A. I have already heard and absolutely understood about AEC.

B. I have just only heard but not understood about this organization.

C. I have never heard about this.

2. Can you point out the establishment time of AEC?

A. 01/12/2014 B. 31/12/2014

C. 01/12/2015 D. 31/12/2015

3. How many countries join this organization?

A. The five formers of ASEAN B. The Southeast Asian Nations

C. ASEAN Nations D. ASEAN Nations & Japan & Korea

4.

What are new in this organization?(You can choose more than one choice)

A. Freer flow of capital B. Free flow of skilled labor

C. Free flow of goods. D. Free flow of services.

E. Free flow of investment. F. Free in nationality change.

5. How many professionals will be allowed to freely flow in the community?

A. 4 B. 5 C. 6 D. 7 E. 86. Some judgements on Vietnamese labor forces.

Criterions Good AverageUnder

AveragePoor

1 Specialism level

2 Labor discipline

3 Communication skills


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4 Office skills

5 Independent working skills

6 Teamwork skills

7 Language competency

8 Information technology for office

7. Is AEC an opportunity or a challenge for you?

A. Opportunity B. Challenge C. Both A & B

8. What are needed for HUFLIT students when Vietnam joins AEC?

9. What are advantages and disadvantages of HUFLIT students?

Advantages: .....................................................................................................................

Disadvantages: ................................................................................................................


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Appendix 2: List of abbreviations.

ACIF SE 2014 ASEAN Community in Figure – Special Edition 2014

AEC ASEAN Economic Community

APSC ASEAN Political – Security Community

ASCC ASEAN Socio – Cultural Community

ASEAN Association of South – East Asian Nations

ASEAN – 6Brunei Darussalam, Indonesia, Malaysia, the Philippines,Singapore, and Thailand.

CLMV Cambodia, Lao People’s Democratic Republic, Myanmar, andVietnam

EU European Union

ILO International Labor Organization

MRAs Mutual Recognition Arrangements

TAC Treaty of Amity and Cooperation in Southeast Asia

USA The United States of America

WTO World Trade Organization


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REFERENCE

Book

Angsuthanasombat, K. (2007). Situation and Trends of Vietnamese Labor Export.

Retrieved from http://www.asianscholarship.org/asf/ejourn/articles/kannika_a.pdf

ASEAN Secretariat (2008), ASEAN Economic Community Blueprint , Indonesia. Retrieved

from http://www.asean.org/archive/5187-10.pdf

Capannelli, G. (2014). The ASEAN Economy in the Regional Context: Opportunities,

Challenges, and Policy Options. Retrieved from

http://www.adb.org/publications/asean-economy-regional-context-opportunities-

challenges-and-policy-options

Huelser, S. & Heal, A. (2014). Moving freely? Labour mobility in ASEAN. Retrieved from

http://artnet.unescap.org/pub/polbrief40.pdf

Nguyen T. T. & Bui, T. V. (2013). Exports - Highlight of Vietnam’s Economy in 2013

General Statistics Office of Vietnam. Retrieved from

http://www.gso.gov.vn/default_en.aspx?tabid=462&ItemID=16083

Nguyen, H. H. (2013). Toward an Integrated ASEAN Labor Market Prospects and

Challenges for CLMV Countries. Retrieved from

http://tapchi.vnu.edu.vn/upload/2014/02/1123/3.pdf

Nguyen, T. N. H. & Bui, A. T. (2004). Vietnam's economic development: Opportunities

and challenges towards the integration tendency. Retrieved from


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http://www.vanderbilt.edu/econ/faculty/Wooders/APET/Pet2004/Papers/Vietnams

%20economic%20development.pdf

Phu, H. M. & Jun, W. Y. (2013). The Current Situation of Vietnam Education. Social

Sciences. Vol. 2, No. 6, pp. 168-178. Retrieved from

http://www.sciencepublishinggroup.com/journal/archive.aspx?journalid=202&iss

ueid=2020206

Internet Resource

Bui, R. (2014). One year ahead of ASEAN Economic Community (AEC): free movement

of goods and labour in Vietnam. Retrieved from

https://vietnamlawbusiness.wordpress.com/ 2014/12/12/one-year-ahead-of-asean-

economic-community-aec-free-movement-of-goods-and-labour-in-vietnam/

FBNC Vietnam. (October 29, 2013). Năng suất lao động thấp, nên gỡ ra sao? [Video file]

https://www.youtube.com/watch?v=CLIH2ajMtes

Pham, T. D. (September 21, 2014). Năng suâ ́t lao đô ṇg ngươ ̀ i Viê ̣t Nam - Thời sự VTV

12h nga ̀ y 14-9-2014 [Video file]. Retrieved from

https://www.youtube.com/watch?v=Yv244FV8h6w

Statistics

Figure 1: HUFLIT Students' Awareness of AEC

Figure 2: Self - Evaluation

Documents

Lê Minh Quốc - Opportunies and Challenges to Vietnamese Labor Forces When Joining Aec