Hue, July 24th, 2018

Labor Market Analysis and Forecast

The world changes

continuously (science,

technology, population,

environment, etc.)

Big data is a resource

Analysis and forecast is a

very important tool

Matching Labor Supply and Demand

Labor Supply

Labor Marketdevelopments Labor Demand

Labor Market indicators

Population, population of age 15+

Labor force participation rate

Education background

Technical qualification

Sex

Urban / Rural areas

Age groups

Unemployment

Populattion without economic activities

Unemployment Long term Youth Education

background/ skill based

Under-employment

Skill matching

Labor SupplyLabor Marketperformance Labor Demand

Employment Formal Inflormal

Employment Sector based Occupation based Status based Based on number of

hours

Productivity

Wages

CHART OF LABOR AND EMPLOYMENTVietnam’s population in 2017

93.7 m people, 64.9% in rural areas

Population of age 15+72,197 m people (80.2%)

Population without economic activities17,034 million (23,6% of age 15+)

Workforce 55,163 m (workforce participation rate:

76.9%)

Employed 54,052 m Unemploymed

1,111 m

Labor force

52,348 53,246 53,748 53,984 54,445 54,524

76,76 77,52 77,51 77,41 76,75 75,89

0

20

40

60

80

100

120

0

10

20

30

40

50

60

70

2012 2013 2014 2015 2016 2017

LLLĐ (triệu người) Tỷ lệ tham gia LLLĐ (%)

Labor force structure

by professional level in 2017 (%)

Unskilled; 61,92

Non-qualification technical workers;

16,48

, 0

Elementary; 3,53

Intermediate; 5,42

college3,17

Graduate and post-graduate:

9,48

Employment

2011 2012 2014 2015 2016 2017

Employment (million of people) 50.68 51.42 52.75 52.8 53.30 54.05

Structure (%)

Agriculture, forestry , aquatic products 48.4 47.4 46,3145.0

41.9 39.8

Industry - Construction 21.3 20.97 21,4421.5

24.7 26.1

Service 30.3 31.68 32,2533.5

33.4 34.1

Waged employment 34.6 34.7 35.6 37.80 41.2 43.4

Self-employment and household

employment 62.4 62.5 62.2 59.1 56.0 54.7

public sector 10.4 10.4 10.4 10.1 9.9 9.7

Private sector 8.1 8.5 8.8 11.385.7 85.2

Individual 77.8 77.3 76.4 73.6

Foreign Investment Zone 3.4 3.3 3.9 4.5 4.4 5.1

Unemployment rate (%) in 2013 and 2017

1,6

3,32,9

6,5

3,5

1,91,7

1,8

3,14,8

3,6

2,1

0,0

1,0

2,0

3,0

4,0

5,0

6,0

7,0

Không có

CMKTSơ cấp Trung cấp Cao đẳng Đại học trở lên Chung

Năm 2013 Năm 2017

Diagram 1: Steps to carry out labor market forecast

<Labor demand forecast> <Labor supply forecast>

Economic growth Forecasting total population

Forecasting employment coefficient Forecasting labor force participation rate

Forecasting the labor demand by sectorPopulation projection from 15+

Forecasting the demand

for labor by sector

Forecasting labor

demand according to

the training level of

each sector

Labor force forecasting (labor supply)

Forecasting labor supply

level, urban-rural, gender

Results of labor demand forecasting

by training level

Labor Supply-demand gap

Sta

te 1S

tag

e 2

Forecasting the labor demand by occupation

Forecasting labor

demand occupational

standards

Forecasting labor

demand by training

level

Sta

ge 3

Sơ đồ 2: Các nhóm nghề cấp 1 tương ứng với mức tay nghề

Cross table Employment by Occupation

35

-

Occupations

National

Economic

Sectors

Group

1

Group

2

Group

3

Group

4

Group

5

Group

6… Sum

Sector 1

Sector 2

Sector 3

Sector 4

….

Sum

Cross table Employment by Occupation - Qualification

36

-

Occupations

Qualifi-

cation

Job 1 Job 2 Job 3 Job 4 Job 5 Job 6 … Sum

Level 1

Level 2

Level 3

Level 4

…

Sum

Labor demand forecast (amount of employment) Scale, the employment structure by urban – rural areas, sex, age group;

Scale, employment structure by educational level, technical qualifications;

Scale, structure of employment by national economy (VSIC), occupation;

Forecast on cross table of employment by sector and national economy (VSIC)

and occupations;

Forecast on cross table of employment by sector and national economy (VSIC)

and technical qualifications;

Forecast on cross table employment by occupation and technical qualification;

Labor market signals include: occupations that are in demand, will be lost,

will arise, etc. in the short term, medium term and long term

Forecast of labor supply (labor force) Scale, population structure from 15+ by urban – rural areas, sex, age group;

Labor force participation rate by urban – rural areas, sex, age group;

Scale, labor force structure by urban – rural areas, sex, age group;

Quality of labor force by educational level, professional and technical qualification;

Unemployment rate by urban – rural areas, sex, age group;

Unemployment rate by education level, technical qualification.

Balancing between

labor supply and

demandIdentifying the scale, excess structure or labor shortage:

by urban - rural, gender,

age group; by education level,

technical qualification

Additional methods for analysing and forecasting labor

market

Population projection by component-based method;

Employment coefficient method;

Multivariable regression with each national economic sector, occupation,

professional qualifications, educational level, etc.;

Questionnaire survey method;

Cobb-Douglas method of production function;

RAS method (Reynolds-Averaged Simulation)

Data Sources for analysing and forcasting labor

market The Population and Housing Census of the General Statistics Office

(GSO) every 10 years;

Quarterly employment or labour force survey

Survey on living standards of Vietnamese households (GSO),

Survey on enterprises and on non-agricultural enterprises (GSO);

Survey on Labor Demand and Labor Supply and Demand Database (Ministry of Labor, Invalids and Social Affairs);

Information of socio-economic development monthly , bi-annually and annually of the Government and the resolution of the National Assembly.

Challenges in analyzing and forecasting labor

market

There is no unified labor market information system that enable coverage on labor supply

and demand information.

Labor market databases are incomplete and not updated regularly;

Vietnam has no infrastructure for collecting and supplying data and no data procedure,

especially for information technology equipment and software, and processing .

There need be experts to generalize information from different sources and provide

forecast of labor market supply and demand.

The labor forecast system is fragmented: There are a number of different organizations

doing similar work on labor forecasting, and there seems to be little or no cooperation

between agencies, ministries and sectors.