THE REALITY OF LABOUR MOVEMENT INSIDE ASEAN – THE PROBLEMS POSE TO VIETNAMESE EMPLOYEES

TRAN LAN
Academy of Finance - Vietnam

Summary: In 2015, ASEAN Economic Community (AEC) was established which opened up many new opportunities for member states in lots of fields including the development of labour market. It is one of the main objectives of this community is “Free to tranfer the well – skilled labour”, thereby in recent years, the wave of the workforce movement inside ASEAN has been becoming stronger with the worker size and quality increasing by the time. Although this new trend brings many positive effects to Vietnamese employees when they can be free to seek job opportunities in foreign nations without any barries, it causes huge competition challenges in the context of the poor qualification of most employees. In this article, the author conducts research on the reality of labour movement inside ASEAN, proposes a number of reasons why Vietnamese workers are unemployed because of this wave and gives some suggestion about what employees need to prepare to catch up with the new trends.

Key words: ASEAN, labour movement, unemployed, prepare.

1.THE REALITY OF LABOUR MOVEMENT INSIDE ASEAN

1.1 The reality of the labour size participates in moving inside ASEAN

Since the establishment of the ASEAN Economic Community in 2015, the wave of labor migration among ASEAN Member States has been more and more strong. Labor migration is influenced by two main groups of factors including differences between countries in their levels of economic and social development, and political stability; labour force growth and population ageing that affect the supply and demand of labour, producing additional challenges and opportunities. Insofar as these factors are structural, not cyclical, labour migration will not diminish in the medium term and will probably continue to rise. Therefore, the number of labours get involved in moving inside ASEAN when time goes on. Since 1990, the stock of intra-ASEAN migrants has risen substantially. As an absolute number, intraASEAN migrants increased from 1.5 million to 6.5 million between 1990 and 2013.(1)

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(1)UN:Trends in International Migrant Stock: The 2013 Revision Database. Several issues with these data and other harmonized sources attempting to provide an aggregate for the ASEAN region as a whole are discussed in Annex D.

 

 

Figure 1: Intra-ASEAN migration shares, 1990-2013 (per cent of total)

<Note: Data on ASEAN give the aggregated shares for the region as a whole.

Source: UN: Trends in International Migrant Stock: The 2013 Revision Database>

Through Figure 1, it is possible to propound some comments:

Firstly, during the period 1990 - 2013, their share of ASEAN’s total migrant stock climbed from 47.8 percent 68.6 percent, a rise of over 20% ( Panel A). In other words, in 2013, the number of employees from ASEAN countries accounted for more than two thirds of the total number of foreign workers in ASEAN. It proves that the trend of intra-ASEAN movement is significantly strong.

Secondly, during the period 1990 - 2013, there was a corresponding increase in the number of migrant workers to ASEAN countries from other ASEAN member states - the proportion increased from 20.3 to 34.6% (Panel B). The three countries that contributed the most to it were Myanmar (up about 40%); Lao PDR ( up about 40% increase) and Cambodia (up about 40%). In contrast, at the same time, the proportion of migrant workers to other ASEAN countries in Vietnam and the Philippines has been inclined to fall below 10%. It shows that in our country, laborers have not paid much attention to the job opportunities intra – ASEAN but tend to move to other countries such as Japan, Korea, Arab countries and European countries. ..

In order to get a better overview of the size of labor involved in intra-ASEAN movement after the AEC was established, the author went further into the study and evaluation of data for the period 2015-2017:

 

 

 

Table 1: Total number of intra-ASEAN migrant workers by origin and destination in 2017

Country of destination

Country of origin

Total number of migrants (people)

Cambodia

Singapore

126

Thailand

31.791

Viet Nam

37.601

Myanmar

53

Lao People's Democratic Republic

268

Indonesia

108

Malaysia

177

Brunei Darussalam

Indonesia

6.517

Malaysia

51.048

Philippines

14.227

Singapore

1.629

Thailand

15.207

Indonesia

Malaysia

2.315

Philippines

4.117

Singapore

23.045

Thailand

23.045

Lao People's Democratic Republic

Cambodia

3.568

Myanmar

259

Thailand

3.428

Viet Nam

19.716

Malaysia

Cambodia

14.409

Indonesia

1.091.841

Myanmar

308.337

Philippines

103.766

Singapore

81.109

Thailand

8.448

Viet Nam

89.017

Brunei Darussalam

6.204

Philippines

Cambodia

40

Indonesia

3.407

Malaysia

817

Myanmar

434

Singapore

845

Thailand

350

Viet Nam

425

Lao People's Democratic Republic

296

Brunei Darussalam

84

Singapore

Indonesia

168.355

Malaysia

1.158.890

Philippines

15.874

Thailand

19.873

Thailand

Cambodia

680.686

Indonesia

690

Malaysia

1.352

Myanmar

1.835.106

Philippines

1.349

Viet Nam

7.255

Lao People's Democratic Republic

923.050

Viet Nam

Cambodia

1.035

Indonesia

8.217

Malaysia

133

Myanmar

11.695

Philippines

118

Singapore

1.830

Thailand

12.077

Lao People's Democratic Republic

7.272

< Source: UN: International migrant stock: The 2017 revision - International migrant stock by destination and origin>

From Table 1, it can be seen that:

Firstly, since the establishment of the ASEAN Economic Community (2015) with the goal of "free movement of skilled labor", the number of laborers involved in intra-regional movements has increased significantly. In some countries like Myanmar, Malaysia and Indonesia, the number of migrants seeking employment in other ASEAN nations has reached millions. Even in the Philippines and Viet Nam, where there was a tendency to reduce intra-ASEAN migrants between 1990 and 2013 (as illustrated in Figure 1), in 2017, the influx of people immigrating to ASEAN member states have reached tens of thousands, hundreds of thousands.

Secondly, the three main destinations of the influx of people who involved in intra - ASEAN movements include: Thailand (3,450,238 people); Malaysia (1,703,131 people); Singapore (1,362,992 people). And in each of these countries, the migrant stock is dominated by workers from a single country of origin: in Thailand, 1,835,106 migrant workers are from Myanmar; In Singapore, 1,158,890 workers come from Malaysia; and in Malaysia, 1,091,841 workers are from Indonesia.

1.2 The reality of labour quality gets involved in intra – ASEAN movement

Indeed, most intra-ASEAN migrant workers have a low or medium level of education. Highly skilled workers often choose to work in non-ASEAN countries.

Figure 2 illustrated the annual flows of international migrant workers from all countries to Malaysia and Thailand according to their occupation. The majority of them enter into medium and low skill sectors. In 2012, high-skill occupations (managers, professionals and technicians) accounted for only 10.2 per cent of the overall flow to Malaysia and 3.1 per cent of that to Thailand. Most of the new arrivals work at the lower (manual) end of medium-skill occupations – as plant and machine operators and assemblers and skilled agricultural, forestry and fishery workers – and in the low-skill elementary occupations.

Figure 2: Annual inflow of migrant workers to Malaysia and Thailand by occupational skill level, 2007-12 (thousand)

< Source: Department of Statistics Malaysia: Migration Survey (Putrajaya, various years); Thailand National Statistical Office, Ministry of Information and Communication Technology: Thailand Labour Force Survey (Bangkok, various years); Thailand National Statistical Office, Ministry of Information and Communication Technology: Migration Survey (Bangkok, 2011 and 2012)>

For Viet Nam, considering the movement of labor to intra-ASEAN countries, workers maybe focus on the fields that do not require high technology. According to ILO forecasts, Vietnam provides the largest number of laborers in the ASEAN market as artisans, followed by service sectors, simple labor and processing industries. Careers which are allowed to move freely intra-ASEAN zone require high skills such as engineers, nurses, architects, doctors, dentists, accountants, surveyors and tourism (under the Mutual Recognition Arrangement ) have very few migrant workers in Vietnam (only 1.3% of total migrant workers). In particular, the high technical labor of men is higher (1.4%) than that of women (1.1%). Female workers often do as housekeepers (about 25% of the total number of female workers), in the textile and garment industry (about 12%) or in manufacturing (about 12%). In addition, Vietnamese female employees also work in the fields of agriculture, fisheries services and seafood processing industry. For male workers, occupations attracting Vietnamese laborers in Malaysia include construction (about 19% of total male workers), manufacturing factory workers (about 21%) and mechanics (about 16% %), electrician (about 6%).

However, it can be said that high-quality migrant workers are the trend of the future. As companies upgrade their operations, they will compete more fiercely for scarce talent – giving a disproportionate boost to the incomes of those who have the right skills. As the simulations carried out for “ASEAN Community 2015: Managing Integration for Better Jobs and Shared Prosperity” report show, higher-skilled workers such as managers, professionals and associate professionals are likely to see their wages rise the most as a result of closer economic integration under the AEC. (Figure 3)

Figure 3: Change in wages under the AEC scenario relative to the baseline, 2025 (per cent)

< Source: ASEAN Community 2015: Managing Integration for Better Jobs and Shared Prosperity>

3. THE MAIN PROBLEMS LEAD TO UNEMPLOYMENT SITUATION OF VIETNAMESE EMPLOYEES IN THE CONTEXT OF INCREASING INTRA – ASEAN MOVEMENT

Firstly, Vietnamese labor is relatively young and abundant, but its technical level is low.

Low skilled labor is one of the main reasons why our laborers are not competitive in the wave of labor mobility in the context of ASEAN integration. The Vietnam Development Report 2014 states, "Most employers say hiring is difficult because of unqualified candidates (or lack of skills) or because of the scarcity of people. Work in some occupations ("shortage of skilled workers"). As the AEC formed, eight areas of skilled labor were relocated: "Technical services, nursing services, architectural services, survey services, medical practice, dental practice, translation accounting, tourism practice "will be filled with foreign workers into our country. Therefore, if you do not improve your ability to work, foreign language skills and soft skills, Vietnamese workers are at great risk of losing at home.

Poor skilled labors is one of the core reasons why our laborers are not competitive in the wave of labor mobility in the context of ASEAN integration. The Vietnam Development Report 2014 wrote, "Most employers say hiring is difficult because of unqualified candidates (or lack of skills) or because of the scarcity of people who work in some occupations ("shortage of skilled workers"). When the AEC formed, eight fields of skilled labor were allowed to move: "Technical services, nursing services, architectural services, survey services, medical practice, dental practice, translation accounting, tourism practice" will be filled with foreign workers who immigrate to our country. Therefore, if they do not improve their ability to work, foreign language skills and soft skills, Vietnamese workers are at great risk of failure at domestic market.

Secondly, the curriculum of Vietnamese education still does not meet the high requirements of the integration process.

Training is more theoretical than practice, which will be one of the barriers for Vietnamese workers to increase the risk of unemployment due to the trend of free movement of skilled labor. In spite of the demand for knowledge, professional skills, soft skills and modern industrial quality in the enterprise; young people are usually educated about general theories, lack of important life skills. Especially, the well - skilled of workforce are not good at informatics and foreign languages, lack of sharp tools to work has greatly affected the ability to persuade domestic and foreign employers even lost their jobs at other ASEAN Member States.

Thirdly, labor market information is generally backward.

The labor market data is both lacking and not updated, most of the labor-employment surveys are not published in time. Efficiency of consultancy, vocational guidance, employment transactions are low. The employment service system of the country only meets 10-15% of the actual demand for counseling and job creation, especially not meet the requirements of high-level labor. In the labor market in Vietnam, key positions such as senior technicians, senior management positions (project managers, HR and marketing managers, etc.), enterprises must seek professional and effective channels like through foreign "headhunters" companies.

Fourthly, the job orientation in educational entities has not been highly effective, leading to the excessive occupation in some fields but lack employments in others.

"Excess of teachers, lack of workers" in Vietnam is always a common situation. While the economy is in short supply of highly qualified employees in many industries such as consulting, design, human resource management, senior business leaders, lawyers, environmental science, technology engineers information technology, biotechnology, electrical engineering, electronics, mechanics, logistics ...; the young graduates are mainly bachelors of finance, banking, accounting, law, administrative office ... While it lacks of skilled workers to increase productivity and competitiveness of products and businesses, most of the graduates of grade 12 choose the path of college instead of studying at vocational training centers. It causes the imbalance of the employment structure in Vietnam, which leads to a structural imbalance in employment in Vietnam. Looking further, if the country does not adjust its labor structure - jobs properly, integration of ASEAN foreign workers will fill the vacant positions instead of the low and medium skill. in Vietnam today.

4.WHAT DO VIETNAMESE LABORERS NEED TO DO TO INCREASE EMPLOYMENT OPPORTUNITIES AHEAD OF THE WAVE OF INTRA-ASEAN MOVEMENT?

In the context of the trend of integration in ASEAN, the "freedom of labour mobility" has become more and more intense. Vietnamese laborers need to do the following in order to find suitable jobs not only in the country but also in other member countries of ASEAN.

Firstly, prepare by yourself for necessary knowledge and skills while studying in school.

In terms of knowledge, especially young workers, need to focus on deepening their professional knowledge by combining various methods such as reading, finding information on the internet, capturing knowledge from teachers, learn more external courses to get international certificates related to their field. In terms of skills, there are three pillars of skills that employers want employees to achieve: cognitive skills, social skills and behavior, technical skills. Cognitive skills include the use of logical, intuitive and critical thinking as well as problem solving using acquired knowledge. They include literacy and numerical ability, and extend to the ability to understand complex ideas, learn from experience, and analyze problems using logical processes. Social and behavioral skills capture personality traits that are linked to labor market success: openness to new experiences, conscientiousness, extraversion, agreeability, and emotional stability. Technical skills range from manual dexterity for using complex tools and instruments to occupation-specific knowledge and skills in areas such as in engineering or medicine.

Secondly, actively seek employment through various channels during and after the learning process.

Technology is developing, labors should actively seek jobs for themselves through the Internet channels, job introduction center, the recruitment days, information from friends, family .. instead of waiting until graduation to apply for a job. In fact, the activeness of Vietnamese students is low compared to other countries in the same ASEAN region. In many nations, from the end of their studies at university, students tend to find works related to their field to pre-practice. By the time they graduated, they had more valuable practical experience and easily found the job as desired. Unlike Vietnamese workers, most college students wait until the graduation to start "frantic" to apply for a specific position. So the common situation is that they often lack the experience, the ability to practice poorly, the psychological not confident .. lead to higher unemployment risks than that its in some countries such as Singapore or Malaysia.

Thirdly, have a clear career path, plan to achieve career goals in the short and long term.

Proper career orientation is one of the most important things for Vietnamese workers to find suitable jobs ahead of the wave of intra-ASEAN labor movement. Workers should think and explore their own capacity to see what they really fit in the industry or their current level, strength / weakness, shortcomings need more practice .. to prepare carefully before meeting the employers. In addition, it is important to understand the needs of the labor market in order to develop careers in the right direction, avoid rushing into sectors that are over-consumed and not in high demand. Moreover, need to pay attention to develop clear plans for achieving career goals in the short and long term. Workers need to consider what time they should work, where they should work, should learn more experience or advance towards advancement .... This is really necessary platforms to help labors develop their career in the present and future.

CONCLUSION

In the context of deep integration, labor mobility inside ASEAN is indispensable. In fact, labor involved in intra-ASEAN movement is increasing in both quantity and quality. This is both a great opportunity and a challenge for Vietnamese workers. Therefore, in order to adapt to this new trend, our employees need to actively improve their knowledge and skills as well as seek employment opportunities for themselves at home (Vietnam) and abroad.
 

REFERENCES:

1. Skilling up Vietnam:Preparing the workforce for a modern market economy -Vietnam Development Report 2014. (World Bank)

2. ASEAN Community 2015: Managing Integration for Better Jobs and Shared Prosperity.

3. UN: Trends in International Migrant Stock: The 2013 Revision Database.

4.UN: International migrant stock: The 2017 revision.

 

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