Vietnam Labour Market Update in Quater 3/2022

In the 3rd quarter of 2022, Vietnam economy was on track to a firm bounce back post-pandemic. World Bank recently raised its Vietnam GDP growth forecast to 7% this year, backed by a recovery in exports, retail and tourism activities, plus low interest rate and a relaxed COVID containment policy.

According to the General Statistics Office of Vietnam, foreign direct investment (FDI) inflows reached 15.43 billion USD in the first 9 months of 2022, increasing 16.43% YoY. This marks the highest 9-month FDI inflows since 2018.

The recruitment market, therefore, saw an upward trend. Adecco Vietnam’s data shows a steady growth in the YoY number of new job openings and job applications. Increasing FDI inflows and investor-friendly policies for industrial zones lead to higher demand in Manufacturing, Engineering, and Industrial Real Estate.

The Service sector also recorded positive signs in hiring demand, especially in Food & Beverage, as easing COVID restrictions and high vaccine coverage allow people to return to their pre-pandemic habits. Though not as much, demand for talents in Hospitality has been recovering since Vietnam reopened for international tourism in mid-March.

According to Ms. Thu Ha Nguyen, Director of Hanoi Office, Adecco Vietnam, demand for middle and senior-level roles in Manufacturing is on the rise, especially in Electronic Manufacturing, since global electronic brands and original equipment manufacturing (OEM) suppliers are relocating their production sites to Vietnam following months of supply chain disruption caused by COVID-19.

“Good government support, young and large workforce, appropriate cost, fewer COVID restrictions, stable political-economic landscape are some reasons that make Vietnam an ideal destination for supply chain relocation, thus the opportunity to become a chain in the global logistic network. The need for Factory Management, Quality Assurance, and Engineers roles has been heating up faster, including existing and new factories”, Ha observed.

The global tech industry is going through a hard time of large layoffs and hiring freezes. In Vietnam, the pendulum seems to swing the other way as tech candidates only match up to 50% of hiring demand. According to Ms. Kim Truong, Associate Director of Permanent Recruitment, Adecco Vietnam, Vietnam is still a competitive market for both foreign and local tech employers.

Ms. Kim explains, ”More foreign investors coming, plus the shortage of qualified candidates are exaggerating the war for talents. Tech experts are sought after to fuel digitalisation projects for digital banks, fintech firms and software companies." Some in-demand positions: Head of Digital Transformation, CTO, CIO, Fullstack Developer, Backend Engineer, Technical Architect, UI/UX Designer, Data Analyst, Product Manager. etc.

However, there is a supply-demand mismatch. “Firms are offering attractive remuneration packages for strategic tech-related positions, but few candidates are qualified. Most fall short of expectations for English and technology proficiency. Post-COVID, candidates working onsite for foreign companies are returning home, which is a good sign to fill the gap”, said Kim.

Candidate movement tends to slow down during Q4 as companies and candidates need to take more factors into account. Ms. Hoa Dang, Director of Permanent Recruitment, Adecco Vietnam, advised: “To enhance the efficiency and ensure a smooth hiring process during the year-end season, both employers and candidates should communicate upfront about their needs and expectations.”

Hoa explains, “Candidates usually add in their expected year-end bonus in negotiations for new job offers. On the other side, businesses need to consider their budget and headcount quota at the end of the fiscal year. That is where the gap lies.”

Without clarity in the first place, it could take rounds of back-and-forth discussions that cost time and effort for both sides. To save time and mitigate misunderstanding, open communication is the key.

For candidates, Hoa reminds them to consider their year-end bonus. “Candidates can weigh in their year-end bonus either via an increase in salary or a sign-on bonus. In case there is no matching offer, then they have two options. One is to play it safe until next year. The other is to trade off short-term gains for a new challenge that matches their career development in the long run. This is a matter of personal choice."