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Adjustment of the Vietnamese Labour Market in Time of Economic fluctuations and Structural Changes

Author

Listed:
  • Xavier Oudin

    (IRD, UMR DIAL, PSL, Université Paris-Dauphine)

  • Laure Pasquier-Doumer

    (IRD, UMR DIAL, PSL, Université Paris-Dauphine)

  • Thai Pham Minh

    (VASS-CAF)

  • Laure Pasquier-Doumer

    (DIAL, IRD, Paris)

  • Dat Vu Hoang

    (VASS-CAF)

Abstract

In this paper, we consider how labour market adjusts to economic fluctuations, considering structural transformation at work as well as short term changes. We utilise series calculated from population censuses and data published in the statistical yearbooks of GSO for long term series, and Labour Force Surveys from 2007 to 2012 for short term data. The paper highlights the deep transformation of the labour market in the last decades. The labour force has doubled in 25 years and the share of agriculture has declined below 50%. Labour supply absorption was thus one of the main challenges for the Vietnamese economy. The household sector has been the main job provider over the years, in agriculture as well as in non-farm activities. The labour market has adjusted to the recent economic slowdown through different channels. If unemployment does not rise, some people withdraw from the labour force and the number of non-active people has grown. The quantity of labour is also affected by a significant reduction of hours worked. While the non-farm sector generates more jobs for skilled workers, there is a shift of unskilled labour towards agriculture. Due to demographic factors, labour supply absorption and creation of new jobs become a less acute problem. As Vietnam benefits of the demographic dividend, the situation on the labour market should be favourable during the present decade to implement structural policies. _________________________________ Dans cet article, nous examinons les ajustements du marché du travail aux fluctuations économiques, compte tenu des transformations structurelles en cours ainsi que des changements à court terme. Nous utilisons pour cela des données des recensements de la population ou publiées dans les annuaires statistiques de l’Office Général de la Statistique pour les séries à long terme, et les enquêtes emploi conduites entre 2007 à 2012 pour les données à court terme. Cet article souligne la profonde transformation du marché du travail au cours des dernières décennies. La population active a doublé en 25 ans et la part de l'agriculture est passée en dessous du seuil de 50 %. L’absorption de l'offre de travail a donc été l'un des principaux défis pour l'économie vietnamienne sur cette période. Le secteur des entreprises familiales agricoles et non-agricoles a été le principal pourvoyeur d'emplois au cours de ces années. Le marché du travail s'est adapté au récent ralentissement économique à travers différents canaux. Le chômage est resté stable mais le nombre de personnes inactives a augmenté. La quantité de travail a également été affectée par une réduction significative du nombre d'heures travaillées. Alors que le secteur non agricole a généré plus d'emplois pour les travailleurs qualifiés, un flux de travailleurs non-qualifiés vers l’agriculture a été observé. En raison de facteurs démographiques, l'absorption de l'offre de travail et la création de nouveaux emplois ne sont plus le principal problème. En revanche, l’évolution récente du marché du travail appelle à la mise en oeuvre de politiques structurelles en vue d’améliorer les conditions de travail, la période étant particulièrement favorable pour mener ces politiques puisque le Vietnam profite actuellement du dividende démographique.

Suggested Citation

  • Xavier Oudin & Laure Pasquier-Doumer & Thai Pham Minh & Laure Pasquier-Doumer & Dat Vu Hoang, 2014. "Adjustment of the Vietnamese Labour Market in Time of Economic fluctuations and Structural Changes," Working Papers DT/2014/04, DIAL (Développement, Institutions et Mondialisation).
  • Handle: RePEc:dia:wpaper:dt201404
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    References listed on IDEAS

    as
    1. Jean-Pierre Cling & Mireille Razafindrakoto & Francois Roubaud, 2010. "Assessing the Potential Impact of the Global Crisis on the Labour Market and the Informal Sector in Vietnam," Working Papers 05, Development and Policies Research Center (DEPOCEN), Vietnam.
    2. Pierre, Gaelle, 2012. "Recent labor market performance in Vietnam through a gender lens," Policy Research Working Paper Series 6056, The World Bank.
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    Cited by:

    1. Axel Demenet, 2016. "Health Shocks and Permanent Income Loss: the Household Business Channel," Working Papers DT/2016/11, DIAL (Développement, Institutions et Mondialisation).

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    More about this item

    Keywords

    Labour Market– Long term and Short term Adjustment – Employment - Vietnam;

    JEL classification:

    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J81 - Labor and Demographic Economics - - Labor Standards - - - Working Conditions

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