Investment & Finance

Mediocre human resource quality in Ho Chi Minh City

Saigon Investment
(Saigon Investment) - Ho Chi Minh City is determined to regain its position as a major economic hub of Southeast Asia, with enhanced finance, trade, and travel services. To be able to do so, Ho Chi Minh City now needs a labor force of world class quality. 

Illustrative photo.

Illustrative photo.

However, for many decades, the human resource factor here has only seen mediocre development, which could possibly take another fifteen to twenty years to improve in quality.

Human resource factor

Ho Chi Minh City is the most populous metropolis in the country, but compared to other big cities in Asia such as Singapore, Kuala Lumpur, or Shanghai, the quality of population calibre is average. This means that Ho Chi Minh City may be densely populated but it is still not strong enough to become a knowledge city of international standards. The City is still mainly based on broad-based labor intensive industry, occupying large premises and using low-skilled labor and outdated technology, supported by large investment and low productivity, and dependent on outsourcing of raw material from other countries. If the population calibre is low, it is difficult for a City to develop quickly and sustainably.

A populous metropolis is made up of many different groups and communities, but not all groups play the same role in the development process. There are groups that play a lead role, there are groups who are motivators and supporters, and there are groups that are only dependents. The quality of the population in a large metropolis such as Ho Chi Minh City can be explained in a pyramid like graph as follows:

On the top of the pyramid is the Elite Group. Studies show that this group plays a lead role in society, and includes experts, senior leaders, and big businessmen. This group is not too large, but consists of smart and intelligent people who are experts in their fields, who orient, create trends, and influence and attract people to follow their model lifestyle. Any city with a large, strong, and united elitist class will always progress the fastest.

On the second rung of the pyramid comes the respond group. This group is quite large, plays a crucial role in the development process, and is the main driving force that also promotes the society and culture of the place. This segment is the middle class, is economically well off, educated, and very capable and talented. In developed societies, the middle class always makes up the majority, possibly upto 40% to 50% of the entire city population.

The last group at the bottom rung of the pyramid follows default social trends. This group is very large, has potential power if mobilized well, but is less active. These three groups all must focus towards improving in quality, which will then easily lead to a high consensus and success. The lessons of Singapore and European countries are living proof of such development and growth. However, among all the three groups, it is the elitist that is the most important and prominent in society.

Shortfalls and inadequacies

Looking from the outside and very objectively, Ho Chi Minh City does not have a strong group of intellectuals and experts, or a strong international research base in various fields. Many of its scientific research products are of poor quality and low applicability, with too few products commercialized domestically and having almost no influence outside its borders. Along with this, public officials serving the people lack professionalism, skills and the ability to communicate with foreign visitors.

In particular, Ho Chi Minh City lacks a good indepth advisory group. Survey results show that grassroots officials do not meet necessary requirements, with only 28% having university degrees. Among these, only 25% have been trained in urban areas; only 9% know a foreign language; and just 13.6% are proficient in office computing. Many cadre officers were transferred from either Women's Union, Civil Defence or Fatherland Front, and only five out of 58 officials in charge of the culture of 58 suburban communes are trained in culture in schools, while the rest are rotated back and forth from different positions.

According to a report by the Center for Forecasting Manpower Demand and Labor Market Information in Ho Chi Minh City, upto 28% of the labor force in Ho Chi Minh City has not been trained, and only 26% has received just preliminary training.

The business community in Ho Chi Minh City is small in size, and its influence is still weak and not of an international level. Ho Chi Minh City lacks economic giants such as Samsung, LG, and Honda. The business giants are mainly in the real estate sector, getting richer from difference in land rent, unfamiliar with market economy, and relying mainly on officials. These giants cannot guide society in terms of techniques, technology, organization, or image. If Ho Chi Minh City wants to have 500,000 businesses, it must have 50 to 100 leading people running both small and micro-enterprises.

Ho Chi Minh City lacks teams of modern industrial workers called blue-collar workers, in the true sense of the word. Workers here are just unskilled laborers with low education and living a poor economic life, while not forming a social class like in developed countries. Industrial products are also mainly outsourced to foreign countries, and handicraft products are monotonous with little innovation. This is reflected not only in production but also in areas such as literary and artistic products for tourism that are few and outdated, and poor in variety and design.

Change economic structure

Ho Chi Minh City needs to change its economic structure quickly and become an international center for finance, health and education services. Tourism must be of a high level, by training young educated people. The solution to restructuring the economic space is to reduce the labor force of medium and low-skilled workers or unskilled workers, and not develop low-level processing factories, but develop industrial parks, high-tech parks, software zones, and biotech zones. It is important to promote industrial development in the central and western provinces also so that workers do not have to move to Ho Chi Minh City.

Forming a class of residents that play a lead role in society, and attract high-quality talent and experts from all over the country and abroad, is an issue that Ho Chi Minh City needs to address with great urgency.

Asso.Prof. Nguyen Minh Hoa

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