Vietnam narrows labor productivity gap with Japan, South Korea

According to the latest report on labor productivity in Vietnam by the General Statistics Office, Vietnam has narrowed the relative gap in labor productivity with Japan, South Korea, Thailand, and Singapore, but the absolute difference continues to increase.

In terms of purchasing power parity (PPP 2017), Vietnam's labor productivity in 2020 reached USD 18,400, only equal to 11.3% of Singapore's productivity level; 23% of South Korea; 24.4% of Japan; 33.1% of Malaysia; 59.1% of Thailand; 60.3% of China; 77% of Indonesia, and equal to 86.5% of the Philippines' labor productivity. 

Vietnam's labor productivity in Southeast Asia is only higher than that of Cambodia, Myanmar, and Laos.

Vietnam has escaped from the group of low-income countries and is facing the challenge of overcoming the middle-income trap. 

The economic development is still dominated by agriculture, and the market has not yet developed sustainably. The number of micro, small, and medium-sized enterprises accounts for too high a proportion in the total number of enterprises (about 97%). 

The quality of the workforce is still low, the production scale is not large, and the application of science and technology is limited.

To address these challenges, the General Statistics Office suggests solutions regarding state mechanisms and policies, including institutional innovation; promoting economic restructuring associated with growth model innovation; creating conditions for the development of science and technology, and enhancing innovative systems within enterprises. 

Additionally, removing financial barriers for enterprises; improving wage and salary policies, education and training policies, identifying suitable production models, and strengthening the linkages between training institutions and enterprises.

Source: ZingNews