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Vietnam's Labour Market in Transition


  • Adam McCarty

    (Institute of Social Studies, The Hague)


This report examines the employment structure and structural change (1986-1999) of Vietnam, discusses Vietnam's labour market regulations and examines how Vietnam's labour markets could become more efficient. Vietnam’s labour policies remain focused on control of state enterprises: who they employ, how many, and what they pay them. The Labour Code of 1995 saw a move to extend state worker privileges throughout the economy. This is a futile exercise to establish a welfare state in a country with minimal resources to support one. What it does do, however, is stifle competition and mobility in the labour market wherever it is implemented. State enterprise restructuring must include a fundamental shift in labour policies to be effective. State enterprise restructuring will create unemployment, but the numbers will be small in relation to Vietnam’s total workforce. Further, restructuring aimed at stimulating development of the private corporate sector would create jobs in excess of the numbers lost from Vietnam’s modest state enterprise sector. Without “change friendly” labour and other policies, Vietnam will remain trapped with an allocation of resources which grows less relevant by the day.

Suggested Citation

  • Adam McCarty, 2001. "Vietnam's Labour Market in Transition," Labor and Demography 0110001, EconWPA.
  • Handle: RePEc:wpa:wuwpla:0110001
    Note: Type of Document - ; pages: 31; figures: included. Draft paper presented at the "Law and Labour market Regulation in Asia" conference, University of the Philippines, November 12, 1999.

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    References listed on IDEAS

    1. David O’Connor, 1996. "Labour Market Aspects of State Enterprise Reform in Viet Nam," OECD Development Centre Working Papers 117, OECD Publishing.
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    More about this item


    labour market; transition; Vietnam;

    JEL classification:

    • J00 - Labor and Demographic Economics - - General - - - General

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