Gov’t to find solutions to low labor productivity

VGP – Low labor productivity was one of the major topics of the Government’s regular meeting held during the past two days following the introduction of the latest report by the International Labor Organization.

September 30, 2014 3:08 PM GMT+7

According to the report, there are large differences in labor productivity between Viet Nam and some other ASEAN countries. Specifically, Viet Nam’s index was 15 times lower than Singapore’s; 11 times lower than Japan’s; 10 times lower than the Republic of Korea’s; 1,5 times lower than Malaysia’s and 2,5 times lower than Thailand’s.

To calculate aggregate labor productivity, the ILO used comparable data from the World Bank’s World Development Indicators (for GDP in purchasing power parity) and its Trends Econometric Model (for total employment).

The large differences between Viet Nam and other ASEAN countries were attributed to the high ratios of the workforce in agriculture and workers.

How can we improve our competitiveness and business environment with such low index - which is just above Myanmar and Cambodia, PM Nguyen Tan Dung questioned.

The Government chief tasked the National Council for Sustainable Development and Competitiveness Improvement to work with relevant ministries and sectors to provide comprehensive analysis of this issue.

The analysis must show shortcomings as well as subjective and objective reasons for proper solutions.

Deputy PM Vu Duc Dam, Chairman of the National Council for Sustainable Development and Competitiveness Improvement said that the Council is mulling a resolution, similar to the Government’s Resolution 19 on major tasks and solutions for improving business and national competitiveness, to improve the country’s labor productivity.

Meanwhile, ILO suggested that the Government should provide quality infrastructure, education and skill development and enterprises need to be able to invest and seize opportunities as paths to productivity growth.

The ILO also forecast that the ASEAN Economic Community has significant potential to spur structural change from low- to high-productivity sectors and Viet Nam could be one of the main beneficiaries of this process, drawing on its educated workforce with its strong foundations in literacy and numeracy skills.

By Hai Minh