February 25, 2024

Dismantling Human Capital Constraints to Pave the Way for Innovation in Vietnam / Assoc. Prof. Tran Phuong Tra

Challenges in Quantity and Quality: Vietnam’s Tech Workforce Dilemma
In the current landscape, Vietnam has approximately 400,000 information technology engineers and over 50,000 information technology students graduating annually, making up 1.1% of the total workforce, as reported by FPT Digital’s recent DxReports. However, the concern arises as only about 30% of them meet the practical requirements of their jobs.
International experts acknowledge the dual challenge of scarcity and inadequacy in Vietnam’s young workforce, highlighting a gap when compared to global standards.
“Not only soft skills and practical abilities but even basic skills are not mastered by fresh graduates, requiring additional training. This situation persists even in Vietnam’s top universities,” remarked Dr. Tran Phuong Tra, Professor of Strategic Management and MBA Program Director at IPAG Business School (France).
As per the Global Innovation Index (GII) 2023 rankings, Vietnam stands out as the only country among the leading economies in Southeast Asia with a weakness in “skilled labor shortage.” In contrast, the challenges for Singapore, Malaysia, Thailand, or Indonesia revolve around costs, funding, or infrastructure.
“The strength of the Vietnamese people lies in their agility. However, when delving deeper into productivity and qualifications, these become weaknesses for Vietnam overall, even in large cities like Hanoi or Ho Chi Minh City. These factors hinder Vietnam’s technological innovation capabilities,” noted Dr. Tra, who is also the Director of the Economic Policy Network at AVSE Global.
Furthermore, the expert evaluates the soft skills of Vietnam’s young workforce as “very weak,” not only in innovation and technology but also in other fields. Concerns include work management skills, proficiency in supporting tools, and attitudes.
“Through practical work experience, I have observed that many Vietnamese students are relatively passive in practical work, showing reluctance in communication and learning compared to international students. Some lack basic skills in their work, despite being top students at their universities,” revealed a communication specialist from an international non-governmental organization in Vietnam.
Accelerating Workforce Training Strategies
Vietnam has ambitious visions for its high-tech workforce, such as plans to train 50,000 semiconductor engineers from 2024 to 2030 and a vision for 2045. Jensen Huang, the CEO of Nvidia, also expressed a desire to collaborate on training 1 million AI experts during his recent visit to Vietnam.
To achieve these ambitious goals, experts suggest that Vietnam needs to immediately embark on innovative initiatives to further accelerate workforce development.
Dr. Tran Phuong Tra emphasizes the need for Vietnam to focus on strengthening the connection between universities and businesses, a model proven to be effective globally, including Germany, which established a renowned industry since its first implementation in 1810.
However, Dr. Tra believes that currently, only Ho Chi Minh City effectively implements this model in Vietnam. Therefore, she suggests more collaboration between stakeholders and localities to expedite the steps in this model – from R&D collaboration, personnel exchange, commercialization, to the development of enterprises and management.
Support from industry players during practical training is also crucial, helping students shorten the adjustment period to the job market after graduation.
“From the third year onwards, about 80% of French students follow a model of both studying and working in companies, with a ratio of up to 50-50. Therefore, foreign students adapt very quickly upon graduation because they have envisioned their daily tasks,” added Dr. Tra.
In this model, the role of research organizations and foreign experts can be crucial, through in-depth supplementary training programs condensed within 3-6 months.
Attracting Additional Investment for Development
The second solution involves Vietnam attracting additional funding for investment, both from the private sector and the state.
Vietnam’s current R&D spending is 0.25% of GDP, significantly lower compared to Singapore (2.4%), Malaysia (1.3%), or Thailand (0.7%). However, the costs to develop the high-tech industry are extremely high, even for large economies. Therefore, experts emphasize that mobilizing resources and the government’s direction are extremely important.
This financial source can also be shared when Vietnam encourages more participation from private domestic and foreign Venture Capital (VC) funds. The current investment value of VC in Vietnam’s high-tech sector is around USD 1 billion, which is 1/8 of Singapore’s.
In addition to policies, according to Dr. Tra, the enterprises/startups themselves must enhance their standards to attract additional funding.
“Vietnam’s tech sector should find the ‘key’ to solve significant challenges that the country is facing to leave its mark internationally, such as urban challenges or climate change. I believe these are areas where Vietnam can compete internationally and attract more foreign investors than just focusing on e-commerce or fintech – areas where many countries are already leading,” said Dr. Tra.
Moreover, to achieve the goal of building a high-quality tech workforce, Vietnam should also invest more in infrastructure and technology, such as high-speed internet access, building research centers, laboratories, and a transportation network. These factors will play a crucial supporting role for the future development of Vietnam’s workforce innovation.
Source: http://surl.li/qwunm
In this article:
Share on social media:

Related articles