Vietnamese productivity equal to 80% of Korea in some fields, but salaries far less
VietNamNet Bridge - GSO (General Statistics Office) has released a report showing that labor productivity is VND93.2 million per worker, or $4,159, in accordance with 2017 prices. 


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Vietnam's productivity has improved significantly



If calculating productivity in accordance with 2010 comparable prices, productivity in 2017 increased by 6 percent over 2016 and by 4.7 percent per annum in 2011-2017.

GSO commented that though Vietnam’s productivity has improved significantly and the country has one of the sharpest productivity increases in ASEAN, its real productivity is lower than many other regional countries.

If calculating in accordance with 2011 purchasing power parity, Vietnam’s productivity in 2016 was $9.9, equal to 7 percent of Singapore, 17.6 percent of Malaysia, 36.5 percent of Thailand, 42.3 percent of Indonesia. 

GSO report said that Vietnam’s productivity is even lower than Lao’s, just equal to 87.4 percent.

If calculating in accordance with 2011 purchasing power parity, Vietnam’s productivity in 2016 was $9.9, equal to 7 percent of Singapore, 17.6 percent of Malaysia, 36.5 percent of Thailand, 42.3 percent of Indonesia. 

The gap in productivity between Vietnam and other regional countries keeps widening. The gap between Vietnam’s and Singapore’s productivity increased from $115 in 2006 to $131 in 2016, while the figures are $220 and $1,422 compared to Vietnam’s and Lao’s productivity.

The low productivity of Vietnamese workers was a hot topic of discussion at a workshop on investment and business opportunities in 2018 held in Thanh Hoa province.

High productivity in some fields

Vo Tri Thanh, former deputy director of CIEM (Central Institute of Economic Management) , noted that the average productivity of Vietnam is low, but productivity is relatively high in some fields and even higher than ASEAN’s average levels.

Nguyen Mai from VAFIEs (Vietnam Association of Foreign Invested Enterprises) agreed with Thanh, saying that Vietnam’s productivity has improved significantly in some production fields.

The economist said Bac Ninh, CEO of Samsung Vietnam, told him that Vietnamese productivity is now equal to 80 percent of South Koreans.

“This partially explains why Samsung makes a hefty investment in Vietnam: while Vietnamese productivity is equal to 80 percent of South Koreans, they receive a salary which is only 30 percent of that of Korean employees,” Mai said.

Binh said it would take 1.5 to 2 years for Vietnamese to catch up with South Korean engineers. 

Most of the managers at Samsung’s factories in Vietnam are Vietnamese, he said.

Intel’s CEO also praised Vietnamese laborers’ capability. He said it is necessary to analyze productivity in each field.

In related news, a report says 74 percent of workers in the manufacturing & processing industry in Vietnam are expected to lose their jobs because of the impact of the fourth industrial revolution, the highest level among ASEAN countries.
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