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

NATIONAL ECONOMICS UNIVERSITY ASSIGNMENT FOR MACROECONIMICS Topic: “The situation and solutions to the unemployment problem of vietnam in 2011 – 2014” Name: Bùi Minh Ngọc Student code: 11219754 Teacher: Mrs Đinh Mai Hương Class: POHE – Market Surveillance K63  - - Contents PREFACE PART 1: THEORY I The concept, classification of unemployment What is unemployment and unemployment rate Unemployment classification Causes of unemployment Part II: Unemployment Situation in Vietnam in 2011 – 2014 .7 I Unemployment in Vietnam in 2011 II Unemployment situation in Vietnam in 2012 III Unemployment situation in Vietnam in 2013 IV Unemployment situation in Vietnam in 2014 .10 PART III: VIETNAM GOVERNMENT MEASUREMENTS TO MINIMUM UNEMPLOYMENT 12 I Government policy on economy 12 Government stimulus package 12 Fiscal policy 12 Policy to attract FDI 12 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 PREFACE 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 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 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 Mơ I  www.chinhphu.vn  www.tailieu.vn  www.123doc.org  www.gso.gov.vn  (Website Tổng cục Thống Kê)  www.dantri.com.vn PART 1: THEORY I The concept, classification of unemployment 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 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 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 future  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 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 Document continues below Discover more from: Macroeconomics Đại học Kinh tế Quốc… 543 documents Go to course Ôn tậpPremium môn Kinh tế Vĩ mô 11 trường đại học Kinh tế… Macroeconomics 100% (12) Premiumvi mo - de thi Trac nghiem 16 kinh te vi mo Macroeconomics 100% (11) Premiumvi mo chuong Trac nghiem Macroeconomics 100% (6) Premium Chuong 27 17 Macroeconomics 100% (6) Premium Macroeconomics Lecture Note Macroeconomics 100% (6) Premium Đề thi kinh tế vĩ mô FTU Macroeconomics 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 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 100% (6) Vietnamese workers 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 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 III Unemployment situation in Vietnam in 2013 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 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 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 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" Failing to meet the increasing production demand Our country has an abundant labor force but still cannot find jobs or have unstable jobs due to low professional qualifications In our country, the rate of trained workers is very low, only about 26% of the total number of employees  In addition, there are many other causes leading to unemployment in Vietnam such as inflation, loss of agricultural land, training level not suitable for working requirements, etc  The chart compares the unemployment rate in 2013 with 2012  IV Unemployment situation in Vietnam in 2014 According to the data, 6.6 million employees, an increase of 3.6% compared to 2013 in which, about 1,494 jobs were created in the country Million employees, reaching 98.6% of the plan, up 2.7% compared to 2013 However, that is only a positive sign in terms of quantity and quality of new jobs, which is still low and unsustainable More specifically about this situation, Dr Bui Sy Loi, Deputy Chairman of the Committee on Social Affairs of the National Assembly said that as of December 31, 2014, the country's population was 90.7 million people, including 54 people ,4 million people in the labor force The whole country had about 1.2 million underemployed workers, rate 2.45% and nearly million unemployed workers, accounting for 2.08%  Cause  The labor force is unevenly distributed (mainly concentrated in the Red River Delta: 15.2% and the Mekong River Delta: 19.1%, while the Northern Midlands and Mountains provinces account for 13.7% and the Central Highlands only 6.3%  Low-quality labor force (Out of 53.4 million workers aged 15 and over working in the economy, only 49% have been trained, of which vocational training from months or more accounts for 19% Occupational safety and health care is not good, besides, labor discipline is still poor compared to many countries, not equipped with knowledge and skills for teamwork, lack of ability to cooperate and take risks risk, afraid to promote initiative and share work experience)  Labor productivity in economic sectors is low and there is a significant difference between the agricultural sector and the industrial sector and the service sector  The state management of labor - employment is still limited, the labor market information system is still rudimentary and inconsistent, the unemployment insurance policy is very progressive but has not yet achieved the target as follows: desire  The chart compares the unemployment rate in 2014 with 2013 PART III: VIETNAM GOVERNMENT MEASUREMENTS TO MINIMUM UNEMPLOYMENT After analyzing and understanding the unemployment situation of Vietnam over the years from 2011 to 2014, we find that unemployment is an alarming problem and needs quick and reasonable solutions Below are some measures that the Vietnamese government has taken to reduce the unemployment rate over the years I Government policy on economy Government stimulus package  Aimed at small and medium businesses The injection of capital and the application of preferential policies to this business sector is first of all to stimulate production, thereby creating jobs  Stimulate demand by investing and developing and completing infrastructure  Speed up the progress of works under construction and renew, renovate and upgrade degraded works on a large scale in order to solve the problem of weak infrastructure of our country as complained by many people foreign investors, but moreover will create more jobs for workers, solve the problem of redundant labor due to job loss from the impact of the recession  The Government can invest in a stimulus package of 5-6 billion USD to increase investment, stimulate production development in areas that are easy to create many jobs and jobs, and promote activities to expand the market schools, supporting production in rural areas Fiscal policy  When the economy is in recession : Expressing the state of national output at a level lower than potential output, the unemployment rate increases The government adopts an expansionary fiscal policy by increasing spending or reducing taxes or both As a result, aggregate demand increases, output increases, creates more jobs and reduces unemployment  Tax reduction program: The Ministry of Finance quickly guided the implementation of incentives in the field of taxes, fees and procedures Reduced VAT on a wide range of items Policy to attract FDI  It is necessary to drastically accelerate the process of restructuring state-owned enterprises and promote equitization As well, there must be a specific mechanism for these enterprises to transparently operate and list on the stock market  The Gov needs to implement an open-door economic policy for international integration and especially to attract foreign businesses to invest in Vietnam Labor export policy  Through Decree 81/2003/ND-CP, the government has decided to establish a labor export support fund, according to which this fund will support the costs of developing a new labor market, providing training for employees employees, support workers and businesses to deal with risks as well as reward agencies and units with achievements in labor export activities Thus, this fund was born has contributed to developing the labor  market, improving the quality and competitiveness of Vietnamese workers in the international labor market, and at the same time supporting risks for workers and businesses There should be policies to support loans for workers going abroad, according to which workers go abroad to work Accordingly, employees who go to work abroad are not eligible for a maximum loan of 20 million dong without requiring collateral, which has removed a lot of trouble for workers, especially for poor workers in rural areas II Effective career guidance and improving the quality of education and training of labor resources One of the causes of unemployment is that the quality of human resources has not met the needs of socio-economic development Therefore, the issue of developing and improving the quality of human resources must be placed into a national strategy It is necessary to mobilize all investment resources, increase the scale and quality for the training and development of human resources - Firstly, education and training need to be in line with the requirements and development realities of the economy, so the education and training sector must constantly reform programs, content as well as teaching methods at all levels at all levels, with special interest in higher education and vocational training in line with reality Vocational training should be based on the economic development orientation, attach importance to the forecasting of labor demand according to different levels - Second, implement the motto of lifelong education and training Education and training is not only in the process of studying in school but also in practice, learning in the society Constantly expanding international exchanges to learn experiences and improve knowledge Labor not only has in-depth knowledge of an industry, but also must know other general knowledge such as foreign languages, informatics, soft skills - Thirdly, study policies on student flow right after graduating from high school such as: regulations on subjects who are allowed to participate in exams to universities and colleges through study scores; encourage vocational training by scholarships from the state budget - In addition, it is also necessary to orient and provide career advice to students Extend the apprenticeship period and raise the average level Training and capacity building of the laboremployment management system, supporting enterprises in creating conditions for employees to learn for life III Unemployment insurance policies On January 1, 2009, unemployment insurance was officially applied nationwide The main contents of unemployment insurance are: - Subjects entitled to unemployment insurance are Vietnamese citizens working under labor contracts or working contracts which not have definite duration or definite term from full 12 to 36 months with the employer employees with 10 or more employees - The condition for enjoying unemployment insurance is having to pay unemployment insurance premium for full 12 months or more within 24 months before losing job or terminating labor contract as prescribed by law; registered with the labor agency when he lost his job or terminated his labor contract and did not find a job after 15 days from the date of registration with the labor agency - The monthly unemployment allowance level is equal to 60% of the average salary, the monthly salary on which unemployment insurance premiums are based for the preceding months before the employee becomes unemployed The unemployment benefit period will be months if there are 12 or less months of paying unemployment insurance premiums; months if full 36- under 72 months of paying UI; months if there are 72-under 144 months of paying unemployment insurance premiums; 12 months if there are enough 144 months of UI payment or more In fact, the law on social insurance and unemployment insurance policy still has many loopholes that allow workers to evade the law for profiteering According to statistics of insurance agencies, our country currently has more than 7.9 million people participating in unemployment insurance The most difficult thing today is the inspection and verification of the workers register for unemployment benefits IV Some other policies - Rearrange and improve the efficiency of the employment service system - Consider adjusting the minimum wage, ensuring the balance between foreign and domestic investment areas in order to expand and attract labor capital - There should be investment policies for socio-economic development in poor midland, mountainous, island and rural areas - Strengthening labor support policies: reducing retirement age, reducing working hours, etc - Limit population growth - Expand the labor export market - Promote job building and combat unemployment - Establishing a system of employment advisory councils from central to local levels - Propose solutions to combat the economic downturn, maintain growth, stimulate demand and invest in consumption to promote production and create more jobs for workers PART IV: CONCLUSION In the context of Vietnam's current economic and political situation, we have many issues that need attention But perhaps the hottest issue today is not only Vietnam that we are interested in, but it is of concern to the whole world that is the problem of unemployment With the cognitive ability as well as the limitation of the article, that's why but in this article, we not analyze each specific issue So from the reasons analyzed above, as well as the current actual situation in Vietnam, we can see the importance of State management for policies like today Having that depends on each of us, the future owners of the country For economic managers, future cadres of the country, this is an issue we must pay great attention to and need to always improve our knowledge, make the most of our time and improve our capacity to keep up with the changing trends economic development in the renewing period