(Tiểu luận) the situation and solutions to the unemployment problem of vietnam in 2011 – 2014

With the topic "Analyzing the unemployment situation of Vietnam in 4 years and the measurement the government should use to reduce unemployment”, I hope to be able to learn more about th

NATIONAL ECONOMICS UNIVERSITY

ASSIGNMENT FOR MACROECONIMICS

vietnam in 2011 – 2014”

Name: Bùi Minh Ngọc Student code: 11219754 Teacher: Mrs Đinh Mai Hương Class: POHE – Market Surveillance K63

 - 

-PREFACE 3

PART 1: THEORY 4

I The concept, classification of unemployment 4

1 What is unemployment and unemployment rate 4

2 Unemployment classification 4

3 Causes of unemployment 6

Part II: Unemployment Situation in Vietnam in 2011 – 2014 7

I Unemployment in Vietnam in 2011 7

II Unemployment situation in Vietnam in 2012 8

III Unemployment situation in Vietnam in 2013 9

IV Unemployment situation in Vietnam in 2014 10

PART III: VIETNAM GOVERNMENT MEASUREMENTS TO MINIMUM UNEMPLOYMENT 12

I Government policy on economy 12

1 Government stimulus package 12

2 Fiscal policy 12

3 Policy to attract FDI 12

4 Labor export policy 12

II Effective career guidance and improving the quality of education and training of labor resources 13

III Unemployment insurance policies 13

IV Some other policies 14

PART IV: CONCLUSION 15

Today, with the advancement of science and technology, the world has made many steps leapfrogging in many aspects, bringing human civilization to become more and more advanced

In recent years, along with the rise of the world, our country has also achieved certain achievements in science and technology in industries such as tourism, services, export But besides those achievements, we also have a lot of problems that need to be concerned and take actions to minimize such as social unemployment, inflation, etc There are so many problems today that need to be solved, but perhaps the problem that is top concern today is unemployment Unemployment – one of the chronic problems of the economy Any country, no matter how developed the country is, will still have the unemployment Vietnam's economy in recent years has encountered many difficulties Impacts of the global economy have caused the

unemployment rate to increase day by day Unemployment leads to many problems for society such as: increase in social evils, discrimination between rich and poor, decline in the economy, etc Vietnam has made significant changes in the economy, but the problem is of solving and creating jobs for workers is still a dilemma of today's society

With the topic "Analyzing the unemployment situation of Vietnam in 4 years and the measurement the government should use to reduce unemployment”, I hope to be able to learn more about the problem of unemployment as well as measures to minimize unemployment rate

in our country to have the most accurate knowledge and understanding for this problem

Object and scope of the study: Unemployment in Vietnam in 4 years (2011 - 2014).

The discussion consisted of four main topics:

Part I: Theory

Part II: Unemployment Situation In Vietnam In 2011 – 2014

Part III: Measurement for The Vietnamese Government To Minimize Unemployment rate Part IV: Conclusion

List of references :

 Giáo trình Kinh Tế Học Vĩ Mô I

 www.chinhphu.vn

 www.tailieu.vn

 www.123doc.org

 www.gso.gov.vn

 (Website của Tổng cục Thống Kê)

 www.dantri.com.vn

I The concept, classification of unemployment

1 What is unemployment and unemployment rate

The social labor force is a part of the population that includes people of working age who are able to work and have labor needs (and people who are out of age but actually participate in labor)

- Unemployed are people in the social labor force who are unemployed and are actively looking for work

- Unemployment rate is the percentage of unemployed people compared to the total number of people in the force labor volume

2 Unemployment classification

 Cyclical Unemployment

Cyclical unemployment occurs with changes in economic activity over the business cycle During an economic downturn, a shortfall of demand for goods and services results in a lack of jobs being available for those who want to work Businesses experiencing weaker demand might reduce the amount of people they employ by laying off existing workers or hiring fewer new workers As a result, people looking for work will also find it harder to become employed The opposite situation occurs when demand strengthens

Cyclical unemployment is often described as being medium term in nature (one to 12 months) Examples can be seen in the unemployment rate rising sharply with the early 1990s recession, declining to low levels by the mid 2000s before rising again around the time of the global financial crisis An increase in cyclical unemployment might suggest the economy is operating below its potential With more people competing for jobs, businesses might offer lower wage increases, which would contribute to lower inflation

Policies that stimulate aggregate demand, such as expansionary monetary policy, can help reduce this type of unemployment (because businesses experiencing stronger demand are likely

to employ more people)

Structural Unemployment

Structural unemployment occurs when there is a mismatch between the jobs that are available and the people looking for work This mismatch could be because jobseekers don’t have the skills required to do the available jobs, or because the available jobs are a long way from the jobseekers Workers may become unemployed if they work in industries that are declining in size or have skills that could be automated because of large-scale technological advances It may be difficult for them to find work in another industry, and they may need to develop new skills or move to a region that has more opportunities

For example, there has been a noticeable decline in the share of people employed in routine manual jobs over recent decades with some of these jobs being automated because of advances

in technology The manufacturing industry is an example of an industry that has a high share of routine manual jobs and its size in the economy has declined (both in terms of production and employment)

Structural unemployment tends to be longer lasting than other types of unemployment This

is because it can take a number of years for workers to develop new skills or move to a different region to find a job that matches their skills As a result, workers who are unemployed because of structural factors are more likely to face long-term unemployment (for more than 12 months)

 Frictional Unemployment

Frictional unemployment occurs when people move between jobs in the labour market, as well

as when people transition into and out of the labour force Movement of workers is neccessary for a flexible labour market and helps achieve an efficient allocation of labour across the economy However, people may not find jobs immediately and need to invest time and effort in searching for the right job Businesses also spend time searching for suitable candidates to fill job vacancies As a result, people looking for jobs are not matched immediately with vacancies and may experience a period of temporary unemployment This type of unemployment is generally shorter term (less than one month)

Frictional unemployment is likely to occur at all points of the business cycle and, like structural unemployment, may not influence wages or inflation

These three types of unemployment are not independent of each other For example, a period of high cyclical unemployment might lift structural unemployment This could occur when people areunemployed for such a long period that their skills and productivity deteriorate, and they become seen as being less employable, reducing the probability that they will be hired in the

Other Types of Unemployment

There are some other types of unemployment that are also important to consider In particular, the underemployment rate can be thought of as a complementary indicator to the unemployment rate when thinking about conditions in the labour market

• Underemployment occurs when people are employed but would like and are available to work more hours There are two categories of underemployed people defined by the ABS First, part-time workers who would prefer to work additional hours Second, people who usually work full time, but are currently working part-time hours Underemployment rates are generally higher among groups that have a larger proportion of people working part time, such as females, younger workers and older workers

• Hidden unemployment occurs when people are not counted as unemployed in the formal ABS labour market statistics, but would probably work if they had the chance For example, someone might have looked for work for a long time, given up hope and stopped looking, but still wish to work (These people are sometimes referred to as ‘discouraged workers’.)

• Seasonal unemployment occurs at different points over the year because of seasonal patterns that affect jobs Some examples include ski instructors, fruit pickers and holiday-related jobs The ABS publishes seasonally adjusted labour market statistics, which remove seasonal patterns in the data

3 Causes of unemployment

 Workers need time to find the most suitable job for them

o Due to the change in labor demand between enterprises

o Due to the change in the working needs of employees

o There are always new people entering or re-entering the workforce

o The excess of supply over demand for labor

o Due to the Minimum Wage Law, the impact of trade unions

o Due to changes in economic structure

o Due to the cyclical nature of the economy

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Part II: Unemployment Situation in Vietnam in 2011 – 2014

Unemployment is one of the four most important factors of a country Reducing

unemployment, maintaining stability and developing the economy is also one of the economic

goals set by the government of our country In the last five years, Vietnam's economic growth

rate has always remained relatively high and stable This has cemented Vietnam's status as one of

the fastest growing economies in the Asia-Pacific region

However, besides economic recovery and development, Vietnam also faces many

difficulties, especially unemployment and job creation In 2013, 2014, 2015 unemployment rates

were 2.77%, 2.08%, and 2.31% respectively - all increased a lot compared to 2012) Through

analysis from many aspects, it has been shown that the cause of the high unemployment rate is

mainly due to the unsatisfactory source of labor and the imbalance of local labor supply and

demand that still frequently occurs for the unemployment rate to increase, putting pressure on

the problem of job creation

The following is a detailed analysis of the unemployment situation in Vietnam in the years from

2011 to 2015

I Unemployment in Vietnam in 2011

The unemployment rate in 2011 fell to 2.27%, from 2.88% in 2010, the lowest level in

the last 4 years The labor force aged 15 and over in 2011 was 51.39 million people, an increase

of 1.97% compared to 2010 The labor force of working age was 46.48 million people, an

increase of 0.12%

The proportion of employees in the agriculture, forestry and fishery sectors decreased

from 48.7% in 2010 to 48% in 2011 The proportion of workers in the industrial and construction

sectors increased from 21.7% to 22.4%, service sector remained at 29.6% The unemployment

rate of working age workers in 2011 was 2.27% In which, the urban area is 3.6%, the rural area

is 1.71% (in 2010 the corresponding rates are: 2.88%, 4.29%, 2.30%)

The underemployment rate of laborers of working age in 2011 was 2.96%, of which the

urban area was 1.82%, the rural area was 3.96% (In 2010 the corresponding rates were: 3.57%;

1.82%; 4.26% In general, the unemployment rate of Vietnam in 2011 tends to decrease but not

much



 Cause

 High inflation rate (18.6%) In order to curb inflation, the government has tightened

credit revenue, making it even more difficult for small and medium enterprises to earn

investment capital

 Affected by the global economic slowdown (because Vietnam's economy is still heavily

dependent on foreign investment and exports) The list of businesses that have to be

dissolved, stopped operating, and narrowed down production is increasing, leading to an

increase in unemployment

 The excessive tightening of NQ 11 caused the banking system to have liquidity problems,

which pushed interest rates to very high, exceeding the tolerance level of the real

economy, adversely affecting the production of enterprises and resulted in many

businesses closing

Macroeconomics

Vietnamese workers do not have high professional qualifications, lack of dynamism and creativity when working



 The chart compares the unemployment rate in 2011 with 2008, 2009, 2010.

II Unemployment situation in Vietnam in 2012

According to the data released by the General Statistics Office on December 24, 2012, the unemployment rate of working-age workers was 1.99%, down from 2.27% in 2011 In which, the unemployment rate was 1.99% unemployment of working age workers in urban area

is 3.25%, in rural area is 1.42% (In 2011 the corresponding rates are: 2.22%; 3.60%; 1, 60%) The underemployment rate of working-age workers in 2012 was 2.8%, of which the urban area was 1.58%, the rural area was 3.35% (In 2011 the corresponding rates were: 2.96%; 1.58%; 3.56%) The General Statistics Office said that although the unemployment rate and underemployment rate in 2012 decreased slightly compared to the corresponding rates in 2011, but the rate of informal workers in 2012 increased compared to some previous years, from 34.6%

in 2010 to 35.8% in 2011 and 36.6% in 2012 The female unemployment rate was 2.36 % higher than the rate of 1.71% in men The country's leading unemployment rate in 2012 was Ho Chi Minh City with 3.92% and the lowest was in the Northern Midlands and Mountains with 0.77% Thereby, we see that people's living standards are still low, the social security system has not yet developed strongly, so workers do not suffer from prolonged unemployment but accept unstable jobs



 Cause

The economy does not create enough jobs for both new laborers entering the market and old unemployed workers

According to the latest statistics, as of 2013, there were 1.3 million unemployed people in Vietnam The number of unemployed people increased by 70,000 over the same period in 2012 The unemployment rate in urban areas is higher than in rural areas (3.67% versus 1.56%) Statistics from job placement centers as of September 20, 2013, an average of more than 114,000 people registered for unemployment every month In 2013 alone, the number of people registered for unemployment was equivalent to more than 93% of the whole year of 2010, equal

to 68.4% for the whole year 2011 and almost 53% in 2012

Before that, in 2012, the unemployment rate was only 1.99%, down from 2.8% and 2.2%

in 2010 and 2011 In which, the labor force aged 15 years and over of the whole country as of July 1, 2013, an estimated 53.3 million people, an increase of 715.6 thousand people compared

to the time of July 1, 2012 and an increase of 308 thousand people compared to the time of April

1, 2013

 Unemployment rate of workers in the first 6 months of 2013 is estimated at 2.28%, of which urban area is 3.85%, rural area is 1.57% (data of both in 2012 respectively: 1.96%; 3.21%; 1.39%)

 The underemployment rate of laborers of working age is estimated at 2.95%, of which the urban area is 1.76%, the rural area is 3.47% (data for the whole year 2012 respectively) are: 2.74%; 1.56%; 3.27%

 The youth unemployment rate is estimated at 6.07% (15-24 years old), of which the urban area is 11.45%, the rural area is 4.41%

 The adult unemployment rate is 1.34 (from 25 years old and above), of which the urban area is 2.55%, the rural area is 0.8%

 The youth unemployment rate in urban areas is 4.5 times higher than the adult unemployment rate

Through this, we see that the unemployment rate in urban areas is always higher than in rural areas and vice versa, underemployment in rural areas is always higher than in urban areas This

is one of the characteristics of the labor market in our country today But the unemployment rate

in urban areas is on a downward trend, specifically in 2010 it decreased by 0.49% compared to

2009, in 2011 and 2012 it decreased slightly by 0.31% The unemployment rate in rural areas is lower than in urban areas, but it has increased gradually over the years



 Cause

 The global economic slowdown causes the unemployment rate to increase The global economic downturn has caused many countries, including Vietnam, to face many difficulties and challenges Vietnam's economy is still heavily dependent on investment and export, so when the global economy is depressed Vietnam's recession was greatly affected, causing high unemployment

 The thought has existed for a long time among young people in particular and workers in general today With the habit of learning to "be a teacher" rather than "be a worker", or like to work for the state but do not like working for the private sector For this reason, social needs cannot fully meet the needs of workers In addition, a part of young people want to do the right job they love even though there are other better jobs, leading to the situation of "someone can't eat it all, someone can't get out"