00:58 (GMT +7) - Monday 20/09/2021

Society

Labor unlikely likely to push up wages post-pandemic

Released at: 06:13, 11/08/2021

Labor unlikely likely to push up wages post-pandemic

Photo: Illustration

Covid-19 has not only disrupted goods supply chains but also labor supply chains. Recruitment demand may dramatically increase post-pandemic, pushing up labor costs and therefore prices. The government needs to issue policies that promote job creation and limit the effect of “false engagement” in the labor market by reducing the unemployment rate.

The recovery needs to be understood not only to return to the state before the epidemic, but also to have an appropriate change direction so as not to miss the beat with the world.

TECHNOLOGY FACTORS PLAYING KEY 

According to a report by the McKinsey Global Institute (MGI), the Covid-19 pandemic has disrupted labor markets globally in 2020. As a result of this shock, millions of people have been laid off or lost their jobs. The imposed distancing measures that disrupt the production process will actively push businesses to deploy automation as well as digital transformation and other measures to rapidly change the way they do business.

That situation will reduce the labor demand of some professions. For example, jobs that directly interact with customers in retail stores, banks or post offices will be at risk of being cut due to the growth and widespread adoption of e-commerce platforms or other platforms. digital transaction method. Catering staff and machine operators are also seen facing the replacement of robots and automation lines.

While the prospect of widespread robotics, AI or automation in Vietnam may not be possible immediately after the pandemic, it implies that for any country, simple common tasks will lost and replaced faster by jobs with high knowledge reserves since the Covid-19 milestone, requiring stakeholders to rapidly modernize the workforce.

The speed of training high-quality workers in Vietnam is still very slow. Vietnam's human resource development strategy for the period 2011-2020 sets out the goal that by 2020, 70% of trained workers will have elementary degrees and certificates or higher. But according to a report by the General Statistics Office last year, this figure only reached 24.1%.

The lack of professionalism, skills and slow updating of knowledge of the workforce will make it difficult to meet the needs of the market. The mindset of disciplining and complying with labor regulations is not high, and the working style is still heavy with spontaneity, which are barriers to labor productivity.

At the same time, the pressure of the epidemic has significantly increased the number of underemployed workers in all three economic sectors and forced many people to become workers in the informal sector. Among them, the tourism, accommodation and catering services, manufacturing, wholesale and retail trade, real estate and transportation and entertainment businesses currently employ more than 24.1 million workers, or 44.2% of total employment.

In Vietnam, these are the areas that are often labor-intensive and are being severely affected by the pandemic.

Another issue, one of the indirect effects of the Covid-19 pandemic is to drag down the quality of training in general, causing concern for the future workforce. According to the General Statistics Office, the number of GenZ (the group of people born between 1997-2012) of working age (from 15 to 24 years old) in 2019 is about 13 million people. By 2025, GenZ is expected to contribute to a third of the working-age workforce in Vietnam and will have a great influence on the domestic labor market.

Social distancing measures mean that university and vocational training is mainly conducted online. The actual quality of each training session may inevitably fall below expectations. The knowledge test in many places is more loosely implemented than before. This also creates concerns about the gap between the job needs and the actual ability of students and trainees after graduation.

In a report by PwC Vietnam, the survey results show that GenZ Vietnam has a positive perception of technology, but is also the generation that is most worried. The three biggest concerns raised by GenZ are that technology will make their roles redundant (51%), won't have the right competencies (26%) and won't be able to learn the right skills (12). %).

RECOVERY IN CHANGE 

There is a fundamental problem that the labor restructuring planning has not been synchronized with other policies. The process of industrialization is associated with urbanization. And when urbanization takes place, it will promote labor movement from rural to urban areas. However, a part of rural laborers, because they have not been carefully prepared for career change, easily fall into unemployment and the vicious cycle of poverty.

This situation, combined with the need for training to keep up with global trends in order to gradually meet the jobs of the future, will put the Government and professional agencies before the achievement of another “dual goal”. , which is both training high-quality workers and in line with the trend of job development. And to do this, the planned policy needs to be directed to both supply and demand sides of the market.

For the supply side, an example is in the report on “The Future of Employment in Vietnam” of the World Bank (WB) in 2018 which outlined 5 major trends affecting the employment situation in Vietnam, in which: There is a growing consumer class in Asia and Vietnam. It is estimated that by 2030, more than 90% of households in developing Asian countries (including Vietnam) will have excess disposable income for consumption, thereby forming a consumer class. of considerable size.

As mentioned above, technology will play a key role, plus this trend will present opportunities for industries such as services and wholesale and retail trade. The strategy to ensure the "dual goal" in this case could be to promote high-quality human resource training focused on meeting labor needs in the e-commerce segment and digital payment methods.

Besides, for the demand side of the market, first of all, the solution packages for businesses need to be implemented with more focus and practicality. Specifically, for businesses in labor-intensive industries, especially those with production chains and leading enterprises, they will be focused on solving difficulties so that they can support one point. but activate many points. For example, supporting demand stimulus through issuing coupons with expiry dates applied in tourist destinations, which will promote spending on many other products and services such as accommodation, restaurants, and food. .

At the same time, there should be more prioritized policies, mechanisms and laws to "nurture" businesses that are doing business in healthy and potentially great fields. In addition to general support measures such as reduction, extension, and postponement of taxes and fees, fiscal solutions such as tax incentive programs for a certain period of time to encourage industries such as digital transformation, business green economy and smart city development.

In the short term, the issue of quality of university and vocational training can be considered as contingencies such as for key subjects of the industry, should choose the best lecturers of the subject to train. created for learners through joint online learning sessions. This helps not to lose professional quality during the learning process of students and trainees.

In addition, management levels should study support policies for units that directly train workers to better grasp recruitment needs and can design additional training modules in the direction of improving employee performance. Professionally and quickly grasp the job right away, saving the retraining costs of businesses. In the long term, it is necessary to consider expanding the assignment of enterprises to directly conduct training and recruit post-training workers, associating enrollment with recruitment.

The Government should pay attention to have policies to promote full job creation to effectively promote the entire workforce. Limiting the “false affluence” effect on the labor market through a decrease in unemployment, but not due to more jobs created, but an increase in the proportion of unemployed people who stopped looking for work by lack of work.

The Covid-19 epidemic not only disrupted commodity supply chains but also disrupted the labor supply chain. After the epidemic, the demand for suitable laborers may increase dramatically, causing wage costs to increase and the price level to be affected, contributing to more pressure on inflation control.

Therefore, the Government needs to well solve problems related to labor supply and demand, employment as well as thoroughly solve the inadequacies in mechanisms and policies and well grasp new trends to have a good orientation. appropriate, greatly contributing to ensuring positive values ​​for the macroeconomic indicators of the economy.

—————

(*) Economic University at Ho Chi Minh City

User comment (0)

Send comment