Vietnam Faces Skilled Labour Shortage Amid Export Order Recovery

Vietnam's economy is on a strong growth trajectory, bolstered by recovering export orders. However, a new challenge has emerged: a shortage of skilled labour. This signifies a shift from the previous issue of simply not having enough workers to a more structural problem of lacking individuals with the skills required for economic development. General Secretary and President To Lam has stressed the importance of candidly addressing existing shortcomings, noting that Vietnam's challenge is no longer a shortage of workers but a shortage of workers whose skills meet development requirements. This highlights that workforce development and upskilling are urgent priorities for Vietnam to maintain and accelerate the growth of its manufacturing and export-led economy. Amidst this situation, Singapore-based United Overseas Bank (UOB) has significantly raised its forecast for Vietnam's 2026 GDP growth to 8.5%, reversing a previous downgrade to 7%. This upward revision is based on stronger-than-expected first-half economic performance driven by manufacturing, investment, and foreign direct investment (FDI). However, maintaining this growth will critically depend on qualitative improvements in the workforce. Vietnam Airlines plans to increase frequencies on several routes to Japan, the Republic of Korea (RoK), and Taiwan to meet rising demand for tourism, business, and family visits. Furthermore, Israeli businesses and experts have introduced a wide range of technologies and solutions for sustainable agricultural development, including smart irrigation systems and greenhouse technologies, indicating the need for technological innovation and talent development in the agricultural sector. The government has introduced Resolution No. 10-NQ/TW, emphasizing the building of a foreign-invested sector that is closely integrated with the domestic sector to create new growth drivers. This strategy aims not just to attract foreign capital but to generate synergy with domestic industries, transitioning towards a higher value-added economic structure. However, experts also point out that this resolution could pose significant challenges related to infrastructure capacity and environmental standards. Vietnam is also fostering ties with countries like Greece, which seeks to address labour shortages by strengthening labour cooperation with ASEAN countries. Improving the quality of the workforce is crucial for enhancing the overall competitiveness of Vietnam's economy. The government is pursuing development across various sectors, including improving the quality of OCOP products, promoting rental housing construction, and expanding its airport network. The proportion of workers holding formal qualifications or certificates rose to 29.7% during January-June, up 0.8 percentage points year-on-year, reflecting a gradual improvement in workforce quality. The State Bank of Vietnam set the daily reference exchange rate at 25,211 VND/USD on July 9, up 5 VND from the previous day. By 2030, Vietnam aims for its airport network to handle about 249 million passengers and 4.4 million tonnes of cargo annually, while ensuring more than 95% of the population lives within 100km of an airport. In a conference, 11 pairs of businesses from Guangxi and Quang Ninh signed cooperation agreements in areas including smart border gate development, logistics infrastructure, trade in agricultural, forestry and fishery products, cross-border cultural tourism, and testing and inspection services, to enhance connectivity between Guangxi's industrial and supply chains and those of Vietnam. Vietnamese Ambassador to the UK Do Minh Hung stated that bilateral ties have developed strongly in recent years, culminating in the establishment of a Comprehensive Strategic Partnership during Party General Secretary To Lam’s official visit to the UK in October last year. Meetings with AFD and EDF were seen as an important step in deepening ties between Quang Ngai and French partners as the province enters a new phase of development. Through broader international cooperation, Quang Ngai aims to attract more capital, technology, management expertise and training resources to advance green industry, clean energy and sustainable infrastructure, strengthen competitiveness and move toward becoming a major industrial, energy and logistics hub in central Vietnam and the country. Deputy Minister of Agriculture and Environment Dang Ngoc Diep said the sector achieved encouraging results thanks to close monitoring of market developments, proactive production management and timely measures to remove institutional and policy bottlenecks. According to the National Statistics Office, cultural industries contributed about 3.54% of Ho Chi Minh City's gross regional domestic product (GRDP) in 2020. The figure rose to around 5.7% in 2025 and is expected to continue growing. Vietnam currently has about 17,400 OCOP products rated three stars or above. The figure is set to increase to around 25,000 by 2030, with greater emphasis on improving quality, adding value and enhancing competitiveness rather than simply expanding the number of products. Vietnam currently has 130,571 rental housing units under construction. A review of national rental housing demand will be completed before the construction ministry assigns specific targets to provincial governments. India remained the largest supplier, with the value reaching 63.2 million USD, representing around 52% of Vietnam's total diamond imports.