Competitiveness of vietnamese labor export in north east asia market a comparison across ASEAN countries

What is the level of competitiveness of labor export across countries in terms of academic performance, technical skill, communication skill, performance rating of previous employers, wo

PREFACE

In this summary dissertation, all figures and tables are numbered as in dissertation

Each year, Vietnam economy have more than 1 million new labors (GSO, 2011), and labor status is always excessive as we mention before Hence, exporting labor is essential way to solve this issue and earning foreign currency for economy Competition happen in everywhere and every sectors, including labor export Hence, determining competitiveness of Vietnamese labor is a key point to develop However, articles which discuss about this issue are very rare

Thus, the theme of "Competitiveness of Vietnamese labor export in North-East Asia market: a comparison across ASEAN countries” is chosen to study

The structure of dissertation includes 5 chapters

Chapter 1: INTRODUCTION

Background of study

The dissertation proposes a system of a set of criteria to evaluate the competitiveness of labor export Base on these indicators, the dissertation evaluated competitiveness of labor export under two points of view: Direct assessment of international employers and indirect evaluation by comparing capacity of labor export and qualifications of international employers In addition, the dissertation compared the perceived competitiveness of labor export across countries and markets Base on these analyses, the dissertation proposes value recommendations to improve competitiveness of Vietnamese labor export They are highly value information for government in building plans and strategies of labor export

Results of dissertation are value sources of information for Vietnamese government and mangers to understand strength and weakness points of export labor;

it also explain requirement of international employers These are very important information for Vietnamese government to plan labor development

Statement of the problem

To implement this study, the author answered the following questions:

1 What is the level of competitiveness of labor export across countries in terms of academic performance, technical skill, communication skill, performance rating of previous employers, working seniority (in previous companies), working attitude, and compliance with labor contract as perceived by the workers and the employers?

2 Is there any significant difference between the level of competitiveness of labor export as perceived by the international employers and the international workers?

3 Is there a significant difference in the perceived competitiveness of labor export across countries?

4 What are the factors that affect labor competitiveness?

Significance of the study

The result of this study is envisioned to contribute knowledge to effective and efficient management of labor export; hence, it will benefit the following:

For the international employers, based on analysis of this paper, Vietnam’s government will build special action plans to improve competitiveness of Vietnamese labors Hence, international employers can have better and more competitive labors in the future

For the Vietnamese laborers, this study will help them understand their strong and weakness In addition, laborers also know the requirements from international employers in term of academic performance, technical skill, communication skill, performance rating of previous employers, working seniority (in previous companies) and personal characteristics Hence, Vietnamese labors can prepare and study to improve their abilities and easier to get success in the future This will provide them with assessments and directions for a better future to apply to working abroad

For the managers of exportation, this research will help them in understanding requirements of international employers These analyses will be very important suggestion to build action plains for improving labor competitiveness of Vietnamese labor The paper will build up the image, competitive advantage through superior innovation, improve and meet expectations of international employers

For the Vietnamese government, this paper will express current status of Vietnamese labors in term of strength and weakness points; it also shows lots of

useful information about requirement of foreign labor importers It will be good bases for Vietnamese government to plan labor development, especially export activities

For other researchers This study will help other researches to collect necessary information in relation to their research fields Other researches will also consider the limitations of this research to avoid in case they conduct the research in same fields

Scope and limitation of the study

The study assessed only the competitiveness of export labors among four countries (Vietnam, Philippines, Indonesia, Thailand) in terms of the following major seven variables: Academic performance, technical skill, communication skill, performance rating of previous employers, working seniority, working attitude, compliance with labor contract This paper considered North-East Asia market only, under evaluation of three international employer groups, which include Japanese, Korean and Taiwanese These main variables were due to the results of reviewing related literatures and studies

Chapter 2: REVIEW OF RELATED LITERATURE AND STUDIES

This section presents the basic concepts, the content related to competitiveness of labor export sorted by the variables studied

Conceptual Framework

Research Framework describes briefly, how to define the problem, to which the authors propose solutions to improve competitiveness of labor export based on the

selected variables

Chapter 3: METHODOLOGY

Research Design

The study used a descriptive type of research which describes the requirement

of international employers and status of Vietnam labors in term of academic performance, technical skill, communication skill, performance rating of previous employers, working seniority (in previous companies), working attitude and

compliance with labor contract Working attitude was expressed by some other quantitative indicators, such as: amount of reward respondent receive within a year, number of late attendance within a month, number of punishment within a year

Using quantitative analysis have some advantages: more reliable and objective; can use statistics to generalize a finding; often reduces and restructures a complex problem to a limited number of variables; looks at relationships between variables and can establish cause and effect in highly controlled circumstances; tests theories or hypotheses; assumes sample is representative of the population; subjectivity of researcher in methodology is recognized less; less detailed than qualitative data and may miss a desired response from the participant

Time and Place of Study

The study assessed the competitiveness of export labors among four countries (Vietnam, Philippines, Indonesia, and Thailand) in North-East Asia market, under evaluation of three international employer groups, which include Japanese, Korean and Taiwanese The study was conducted during first of 2013

Sampling

The four working areas were divided into garment, production and construction, navigation and home service These are the most labor attraction area

Using Slovin’s formula to calculate the sample size

2

*

N n

+

=

Where:

n is size of the sample

N is total number of employee

e is standard error at α = 0.05

According to MOLISA (2012), Japan, Taiwan and South Korea is the three biggest countries, where Vietnamese labor currently enroll and potentiation of labor export Further, four main working areas are garment, production and construction, navigation and home service and will be do research separately Ten employees per country were selected for each working area with a country

According to MOLISA (2012), In Japan, Taiwan, South Korea, international employees come from Vietnam (12%), Philippines (10%), Thailand (9%) and Indonesia (9%) are majority Hence, based on competition in ASEAN in term of labor exportation, four countries are considered: Vietnam, Philippines, Thailand and Indonesia

Normally, we will use Slovin's formula to determine samples But in this case, population of data is too big, this formula is no longer available; hence the author selects three companies - which imported the biggest quantity of foreign labors - for each area per country and chooses randomly employees So, totally, we will interview and evaluate 480 workers

On the other hand, 108 international employers will be interviewed In which, three big companies in each country will be covered for an area Directors, vice director and head of human resources management will be respondents

Respondents of the Study

The respondents of the study included 108 managers from 3 destination countries and 480 correct working employees from 4 labor export countries They were selected randomly from three biggest enterprises of each sector

Table 1 Distribution of the Respondents by Working Area, 2012

Area International Employees International Employers

Production and

Data Collection

Some government agencies were visited to gather information needed These agencies were the National Statistics Office and Ministry of Planning and Investment

which provided them information about the Vietnamese labor export Different schools and libraries were also visited to gather theories and concepts from books and other research materials and necessary data about competitiveness Websites were also visited to gather additional data regarding the subject matter

The researcher then prepared the questionnaire using the Likert-type scale with five points It was afterwards checked by the adviser Questionnaires were sent

to 108 managers in 36 international enterprises within 3 countries Next, they modified it and were given to some faculty experts for the validation of its contents After that, it was given to the panel of examiners for the approval After the approval, the research conducted a dry-run to test the reliability of the questionnaire The statistician using Statistical Package for Social Sciences (SPSS) software program checked the reliability of the questionnaire After the reliability was proven, the researcher conducted the actual survey

The researcher distributed the questionnaires to the respondents 108 managers and 480 workers Then, the questionnaires were retrieved The results were tallied, tabulate and treated statistically Finally, the results were interpreted and the findings and conclusions were drawn

Research Instrument

The researchers used the self-constructed questionnaires to get the primary data The questionnaires composed of three parts The first part included the respondents’ profile, the second part was on the business’ profile, and the last part focused on qualification of respondents based on requirement of international employers The questions were in the form of Likert - type scale using the give point scale with five as the highest and one as the lowest It was assigned with the following values:

Point Range Employers’ evaluation Descriptive Interpretation

4.20 – 5.00 Very competitive / Not expectation /

3.40 – 4.19 Competitive / Less expectation /

2.60 – 3.39 Neutral / Average expectation / Normal Fair

1.80 – 2.59 Less competitive / Moderate expectation

1.00 – 1.79 Uncompetitive / High expectation / Not

Independent variables (academic performance, technical skill, communication skill, performance rating of previous employers, working seniority, working attitude and compliance with labor contract) will be measured by a list of questions, which was explain in questionnaires Dependent variable was evaluated by comparison between employees’ perception and qualification indicators of international employers

List of questions will be checked accordance by Cronbach’s Alpha Cronbach’s Alpha from 0.8 to near 1, the measurement scale as well, from 0.7 to 0.8

is used The researchers also suggest that the Cronbach’s Alpha of 0.6 or more can be use in the event of working on new concepts or new for respondent in the context of the study (Chu Hoang Trong, Nguyen Mong Ngoc, 2005) So for this study, the Cronbach Alpha of 0.6 or more is acceptable

Methods of Analysis

Descriptive Statistics - Mean, standard deviation, Rank, Percent, Frequency to

describe the profile of the respondents in terms of age, sex, health status, civil status, preceding jobs, weight and height; to describe the profile of the enterprises in terms of type of enterprise, size of capitalism, year in business, sector which enterprise belong, numbers of worker, job position of respondent.; to describe the level of competitiveness of the employees; and to determine the respondents’ requirements and ranking of priorities in hiring imported labor from Southeast Asia

Correlation analysis was used to determine relationship of independent

variables to competitiveness of labors In this study, author will use multivariate regression to determine the factors affecting labor competitiveness

The multivariate regression equation:

LC = 0 B + B 1 * AP + B 2 * TS + B 3 * CS + B 4 * PRPE + B 5 * WS + B 6 * WA + B 7 *

CWLC + e

Where:

LC = Labor competitiveness

AP = Academic performance

TS = Technical skills

CS = Communication skills

PRPE = Performance rating by previous employers

WS = Working seniority

WA = Working attitude

CWLC = Compliance with labor contract

e = Random error

Independent variable will be: (1) academic performance, (2) technical skill, (3) communication skill, (4) performance rating of previous employers, (5) working seniority (in previous companies), (6) working attitude, (7) compliance with labor contract

T-test was used to compare the competitiveness of labor export as perceived

by the international employees and international employers while Analysis of Variance (ANOVA) was used to compare the competitiveness of labor export across Southeast Asian countries

Chapter 5 PRESENATION ANALYSIS AND INTERPRETATION OF DATA

This chapter presents the analysis and interpretation of data based from the sub-problems presented in the study

Profile of respondent

Age

Age group Percentage (%) Mean Std Deviation

Gender

62%

38%

Female Male

Marital status

Highest Educational Attainment

Height and weight

71%

29%

Single Married

4%

71%

25%

Secondary School High School Collenge graduate

4%

50%

38%

8%

1,4m-1,5m 1,5m-1,6m 1,6m-1,7m

>1,7m

63%

25%

8% 4%

40kg-50kg 50kg-60kg 60kg-70kg

>70kg

Majority of these respondents were 16-30 age female with high school degrees, single with height 1.5-1.6 meter, weight 40-50kg There is the highest percentage of respondents having the age of 16-30 years (71%) Meanwhile, there is only a 8.0% of respondents having age of 40-50 years and 21% of respondents having age of 30-40 years This distribution among age reflects that companies are using young labors Majority of the respondents covering sixty-one percent (62%) are female and only thirty percent (38%) are male This distribution among gender is common to the nature of work Structure by educational level: sample mainly focused

on those that unskilled workers are majority, hence high school make up 71%, college graduate cover 25% and secondary school percentage is 4 percent We conduct survey

in garment, production, construction, navigation and home service sectors, hence respondents are unskilled labor mostly Actually, these did not need highly skilled labor

Competitiveness of Labor Export across Countries

This paper compared competitiveness of Vietnamese labor export with other three countries: Philippines, Indonesia, and Thailand Indonesian have the highest capacity of competitiveness, especially in term of compliance with compliance with labor contract, communication skills and working attitude Meanwhile, Vietnamese is lowest, especially in term of technical skills, working seniority and communication skills Philippines have advantages in technical skills, working attitude and reputation Thai is similar Vietnamese, technical skills, communication skills and working seniority are not their strong points

This study also determined evaluation of international employers from Taiwan, Japan and South Korea to Vietnamese, Filipinos, Indonesian, and Thai about competitiveness and their factors Philippines and Thailand are very good competitiveness in perception of international employers Vietnamese labors show some weak points related to technical skill and compliance with labor contract They usually run away although labor contract was not expired In addition, no employers concerned about performance rating of previous employers More importantly, qualifications of international managers about imported labor are expressed clearly Hence, we can understand strength and weakness of Vietnamese labor, troubles in exportation process and the gaps of quality we must try achieving