Phạm Hoài Nam, director of the Department of Population and Labour Statistics. — Photo nhandan.vn

Phạm Hoài Nam, director of the Department of Population and Labour Statistics under the General Statistics Office (GSO) talks to Thời báo tài chính Việt Nam (Việt Nam Financial Times) about the labour market and employment situation in the first quarter of this year.

What can you tell us about the labour market and employment conditions in the first quarter?

In the first quarter of this year, the number of workers negatively affected by the COVID-19 pandemic decreased sharply from 24.7 million in the fourth quarter of 2021 to 16.9 million. 

The number of people employed has increased by nearly one million people compared to the previous quarter. The average monthly income of workers has gradually improved, about VNĐ6.4 million (US$276.6), an increase of VNĐ1 million compared to the previous quarter.

The labour market in Việt Nam has prospered in many ways and has gradually recovered. However, some unsustainable factors still remain. 

The labour force increased compared to the previous quarter but was still lower than the same period in 2019, before the pandemic. 

The rate of people at working age joining the labour force decreased by 3.25 percentage points compared to previous years. 

The number of people employed has increased rapidly, but much of that is in the informal sector.

The country's labour market picture has witnessed more 'bright spots' in the first quarter of the year, but we need to continue our efforts to promote more recovery programmes to achieve a normal state as before the outbreak of the COVID-19 pandemic.

The Government has been implementing a number of policies to promote economic recovery, including policies to support the labour market. How do you assess these policies?

The first quarter of 2022 witnessed the unprecedented spread of the COVID-19. However, the policy of safe, flexible adaptation and effective control of the COVID-19 pandemic made the labour market in the first quarter show many signs of prosperity. Unemployment rate has reduced significantly.

The Government continues to issue many guidelines, policies and solutions for economic recovery and development in 2022 and the following years, such as Resolution 11/NQ-CP on the recovery programme and socio-economic development. A series of solutions to stimulate the economy have been put forward as a lever for economic recovery, such as: a socio-economic recovery programme worth nearly VNĐ350 trillion (approximately $15 billion), increase investment capital, speed up the progress of public investment projects, strengthen support for social security, reduce lending interest rates and support business recovery and development.

Most recently, the Government started implementing a rental assistance package for workers' accommodation in Resolution No 43/2022/QH15 dated January 11, 2022. The package is worth VNĐ6.6 trillion ($20.9 million), in part of the VNĐ350 trillion economic recovery package. 

Each employee who is renting and/or working in industrial parks, export processing zones and key economic areas will be supported with VNĐ500,000 per month for housing rental support for three months.

Many other support packages mentioned in Resolution 43/NQ-QH are aimed at recovering production and business activities, promoting growth and keeping the unemployment rate in urban areas less than 4 per cent; stabilising the macro-economy and ensuring other major balances of the economy; reducing costs, supporting cash flow and creating favourable conditions for enterprises, household businesses and people.

With these factors, we expect the labour market will recover and grow back in the near future as before the pandemic.

Although the unemployment and underemployment rates decreased compared to the previous quarter, many businesses have a shortage of workers. Why is this the case?

Enterprises are always in shortage of labourers, especially skilled workers, and highly qualified workers. The economy always exists a certain natural unemployment rate depending on market characteristics. For example, the unemployment rate in Belgium is at 5-6 per cent; Germany at 3-4 per cent; France 8 per cent; the United States 4 per cent (8 per cent during COVID-19 pandemic); Singapore, Indonesia, Malaysia are at 3-4 per cent; Thailand, Laos, Cambodia and Myanmar are less than 2 per cent; and Việt Nam and the Philippines is about 2-3 per cent.

A natural unemployment rate does not mean that workers do not want to work or are not interested in work. This ratio reflects the percentage of people who are looking for work and are willing to work but have not found a job. — VNS