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Viet Nam Labor and Employment: Skills Training for Jobs
ADB helped Viet Nam improve its vocational and technical education system to meet the growing demand for skilled industry workers in the country.
Vocational and technical education (VTE) is an indispensable factor in addressing labor requirements for countries transitioning to market economies, such as in the case of Viet Nam. The demand for skilled workers in the country markedly increased after the period of economic reforms known as Doi Moi (Renovation) in 1986. However, meeting this demand has been a week point for Viet Nam’s VTE system given the country's previously supply-driven, outdated and low-quality VTE sector.
Under Doi Moi, the government sought to create 1.2 million to 1.3 million job opportunities starting in the year 2000. The proportion of trained workers was expected to increase from 10%-11% to 25% by 2000 and to 50% by 2010. At project appraisal, about 80% of the labor force was unskilled, mostly concentrated in the rural areas, and only 10% had formal training.
To overhaul Viet Nam's VTE system, ADB supported the Vocational and Technical Education Project which helped improve the system's market orientation, develop curricula and materials to upgrade key schools, improve equipment and facilities, and strengthen institutional capacity in the General Department of Vocational Training (GDVT) to implement VTE reforms.
This included establishing a labor market information system (LMIS), program accreditation and technical certification systems, improving access for women and minority students, staff development, cost recovery, and private sector participation.
The project costs totaled $86.29 million, of which ADB financed $32.57 million, Agence Française de Développement $12.22 million, Japan International Cooperation Agency $19.17 million, and Nordic Development Fund $6.35 million. The Government of Viet Nam provided $15.98 million.
The project was found to be responsive to Viet Nam's increasing demand for skilled industry workers, and mostly aligned with the policies and strategies of the government and ADB, according to a report by ADB's Independent Evaluation Department (IED), which gave the project an overall rating of "successful."
In terms of developing a new curriculum methodology and providing modern training equipment at key schools, the project was deemed effective. The LMIS, career guidance, production units, school-industry partnership, and program accreditation and technical certification were achieved though not effectively utilized.
The project was consistent, and thus highly relevant, with major policy priorities under Viet Nam's Education Development Strategy 2001-2010 and ADB's lending strategy for the country. It was also deemed effective in realizing most of the targeted outcomes and outputs, as well as efficient in terms of resource utilization at the 15 key schools.
According to the project completion report, the project trained 108,000 skilled workers and production technicians by 2008. There were a total of 210,060 graduates from all courses in key schools during 2001-2007. The survey of 13 key schools conducted during the Independent Evaluation Mission shows many of the graduates managed to find jobs, varying from around 50% to almost 100%.
The Independent Evaluation Report identified five important lessons from the project:
- Management of VTE requires extensive coordination among different stakeholders. For the project, there was little collaboration and sharing of lessons among donors. And there were overlapping responsibilities for technical and professional education among government ministries and agencies.
- Outcomes need to be integrated with the national system for them to be effectively utilized and sustained.
- Strong management capacity should be a prerequisite to project implementation.
- Establishing a market-driven VTE system is a long process and requires macro-level links with industry. Many of the VTE graduates obtained jobs that were not in the same field as the training they received. The percentage of nonmatching jobs ranges from 10% to 45% across years and degrees.
- The quality of VTE can be improved with more and broader participation of students. University degrees are still preferred over VTE. The system attracts relatively few disadvantaged students such as women, ethnic minorities, and the poor.
ADB's Independent Evaluation Department recommends that the Government of Viet Nam should continue improving the focus of its VTE system, and streamlining VTE management to reduce overlapping of duties among government ministries and agencies.
The government also needs to reconsider the balance between investments in vocational and academic institutions, and step up campaigns to familiarize secondary and high school students with the benefits of vocational training.
The report urged increased collaboration between ADB and development partners to share lessons and coordinate assistance strategies and between the VTE system and the labor market to match skill requirements with training.