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Aims and objectives 2.1.1 Research aims: based on scientific theories on the role of industrial parks for human resource development of industrial sector and reality of coastal provinces

NATIONAL ECONOMICS UNIVERSITY - -

PHẠM MINH LỘC

THE ROLE OF INDUSTRIAL PARKS FOR HUMAN RESOURCE DEVELOPMENT IN INDUSTRIAL SECTOR - A STUDY IN CERTAIN

COASTAL PROVINCES IN RED RIVER DELTA

Major: POLITICAL ECONOMY Code: 9310102

EXECUTIVE SUMMARY

HÀ NỘI - 2024

NATIONAL ECONOMICS UNIVERSITY

Supervisor: Asso Pr, Dr MAI NGỌC ANH

INTRODUCTION 1 Rationales

To begin with, while the annual rate of labor attraction is high, the percentage of labor termination is also great According to Nguyễn Hữu Dũng, although the number of labor nationwide increases about 10% year by year, the rate of labor force fluctuates (employed-unemployed) up to 50% - 60%, and even 70% in some industrial parks in Ho Chi Minh city This results in the shortage of labor and unstable labor force for manufacturing guarantee Nearly 73% of labor leaves their jobs due to unsatisfactory income, causing unaffordability in daily life, especially in anniversaries and Lunar New Year (Nguyễn Hữu Dũng, 2008) In the area of coastal provinces in Red River Delta, the rate of labor termination is higher than that of labor attraction There are cases that firms cannot attract labor but suffers from great percentage of termination, such as HZ- Tone VINA Ltd With 30% labor termination (Management Board, Hai Phong economic zone, 2015) This reveals that there has been serious problem of labor termination, causing not only increasing cost for enterprises, but also unstability of employment and social security for labor and their future

Secondly, although there has been an increase in the number of skilled labor and decrease in that of unskilled one within the structure of technical level of labor in industrial parks; in 2015, the rate of unskilled labor still accounted for 45% This results in low quality of labor in the industrial parks, causing unsatisfactory competence for technical requirements in these areas which negatively affects productivity and quality of final products At the same time, the advancement of labor in general and technical level of labor in the society would be limited

Thirdly, labor’s awareness of compliance with discipline, attitude towards assigned jobs, interest in their jobs, spirit for technical development and improvement for industrial-based working style are still poor This affects productivity and results in weak labor force with low responsibility and ethics

In other words, labor force in industrial parks nationwide in general and in coastal provinces in Red river delta in particular has been facing different troubles, which refer to unstable jobs, limited technical level and poor working style In the context of strong development in industrial parks, the guarantee for labor stability in these areas as well as labor source with high technical level and good working style has been an concerning requirement

There have been many studies related to labor recourse in industrial parks However, they only focused on the perspective of considering labor as the input to meet the requirement of labor for manufacturing development in these areas By that way, in order to upgrade industrial parks, there must be guarantee for labor force in terms of quantity, structure and quality (Đỗ Tuấn Sơn, 2017)

At the same time, industrial parks should take actions to improve the labor role, which contributes to sustainable devevelopment of labor in industrial sector As a matter of fact, activities serving that purpose have received little attention Then, labor here have been facing unstability In the short time, they have jobs to earn for their living However, in the long run, even they have not reached retirement, workers in these areas would face unstability due to implicit rules as well as labor termination In the context of market economy, labor termination based on manufacturing periods is a factuality, which might become a big disaster for labor When they have not reached retirement, workers still expect to serve firms in the industrial parks Nevertheless, these companies finish operating periods or declare dissolution, making labor face employment risk In addition, when they are employed in these firms, workers only concentrate on a specific part of production line; so they know nothing about other jobs This causes labor’s disastisfaction, unstable development of industrial sector and that of social labor force Especially, even if workers try to improve their technical skills, they still find it hard to seek for new jobs after being unemployed Changing jobs to earn money is natural Labor quality of industrial parks in particular and that of the society (industrial sector) in general is at low level with employment risk at the time of re-participation in labor market These realities have existed with requirement for systematic studies

Therefore, the thesis on “The role of industrial parks for human resource development in industrial sector-a study in certain coastal provinces in Red river delta” would bring about urgent theoretical and practical significance

2 Research aims and objectives 2.1 Aims and objectives

2.1.1 Research aims: based on scientific theories on the role of industrial parks for human resource development of industrial sector and reality of coastal provinces in Red river delta; the thesis introduced perspective, direction and solutions to improve the role industrial parks for human resource development of industrial sector in coastal provinces in Red river delta in upcoming years

2.1.2 Objectives

First, relying on literature review of domestic and international studies on the researched topic, the thesis contributed to synthesizing theories and experiences related to role of industrial parks for human resource development of industrial sector in certain provinces and cities

Second, the thesis analyzed reality of current role of industrial parks for human resource development of industrial sector in certain provinces in Red river and pointed out achievement, limitations as well as reasons

Third, the thesis proposed perspective, direction and solutions to improve the role industrial parks for human resource development of industrial sector in coastal provinces in Red river delta in upcoming years

3 Research subject: the role of industrial parks for human resource development of industrial sector

Because human resource development in industrial sector is broad, the thesis just focused on direct manufacturing labor, or domestic labor including skilled and unskilled labor

The development of human resource for industrial sector in this thesis should be understood as the development in terms of quantity, structure and quality of labor for the industrial sector

4 Research scope:

- Space: The coastal provinces of the Red River Delta include Quang Ninh, Hai Phong, Thai Binh, Nam Dinh and Ninh Binh This study collected secondary data on the results of industrial park development, the status of industrial parks’ human resources in three representative localities: Nam Dinh, Ninh Binh, Hai Phong Among these, Hai Phong is one of the first two localities in the country to build export processing zones (EPZs) in Vietnam (Do Son EPZ, Hai Phong and Tan Thuan EPZ, Ho Chi Minh City) Up to now, Hai Phong is also a locality with strong development of EPZs, industrial parks, and economic zones compared to the coastal provinces of the Red River Delta The issues that have been resolved and need to be resolved in regard of the development of industrial human resources in Hai Phong, the role of IPs in the development of industrial human resources in Hai Phong, are therefore representative in the study of the role of IPs in the development of industrial human resources in the coastal provinces of the Red River Delta In addition, Nam Dinh is one of the five provinces in Vietnam currently with the highest GRDP growth rate in the country Meanwhile, Ninh Binh, despite positive changes in economic growth and development in recent times, has an average income per capita in 2021 of 51.38 million VND/person/year; only above Quang Ninh and Hung Yen in the Red River Delta region (Nguyen Huy Luong, 2021) The provinces selected in this study are therefore representative of the coastal area of the Red River Delta

The thesis used primary and secondary data processed based on survey results in Hai Phong city In addition, the author carried out in-depth interview with some scientists, local managers and leaders in Nam Dinh, Ninh Binh about relevant topics Survey and interview data served as basis for analysis and evaluation on reality and the role of industrial parks for human resource development in indistrial sector in some provinces in Red river delta duch as Hai Phong, Nam Dinh, Ninh Binh in the past time Also, in order to guarantee objectivity and completion of research sample, the thesis used secondary data which reflected the development of the industrial parks and the role of industrial parks for human resource development in industrial sector, especially it also provided forecast for the development of these industrial parks in

Nam Dinh, Ninh Binh and Hai Phong in the future The combination of secondary and primary data was scientific basis for recommendations of this thesis

- Time: The collected data was comprised of 2 categories The first one was secondary, which reflected reality of industrial park development and that of human resource development in industrial parks in 3 selected provinces from the time of their establishment to 2022; as well as provided forecast for the development of industrial parks in selected provinces towards 2030 The second type of data was primary based on survey and interview results regarding human resource development in Hai Phong in 2020; noticeably, results of in-depth interview with certain managers and leaders in Nam Dinh, Ninh Binh, Hai Phong were continuously updated during the time of thesis completion

Based on analysis and evaluation on the role of industrial parks for human resource development in industrial sector in 3 selected coastal provinces in Red river delta, the author proposed some recommendations, directions and solutions to the research subject until 2025, and vion towards 2030

5 Thesis approaches +Emperical approach:

In order to study the role of industrial parks for human resource development in industrial sector in coastal provinces in Red river delta, the thesis constructed research frame (see 1.3.4.1.) Accordingly, based on secondary data and primary data collected in Nam Dinh, Ninh Binh, Hai Phong; the thesis analyzed and evaluated reality of the role of industrial parks for human resource development in some coastal provinces in Red river delta With the combination of data in Nam Dinh, Ninh Binh, Hai Phong; the author clarified a general insight into the role of industrial parks for human resource development in some coastal provinces in Red river delta

+Systematic approach:

Based on this way, to begin with, the thesis clarified socio-economic setting for human resource development in the industrial sector in Hai Phong, Nam Dinh, Ninh Binh; identified affecting factors on the role of industrial parks for human resource development in industrial sector in certain coastal provincies in Red river delta; analyzed reality of changes in terms of quantity, structure and quality of human resource for industrial sector under the impact of industrial parks; evaluated current achievements, limitations and reasons for human resource development in industrial sector; then, the thesis proposed perspective, directions and solutions to improve the role of industrial parks for human resource development in industrial sectors in some coastal provinces in Red river delta

+ Inter-disciplinary approach:

Human resource development in industrial sector under the development of industrial parks depends on not only the industrial sector itself but also others,

especially the development of science and technology, education and training as well as the attention of local firms and authorities at different levels Therefore, the study on the role of industrial parks for human resource development in industrial sector should be accessed based on inter-sectoral approach in order to analyze the connection in implementation of activities by authorities at locality and those at different levels, enterprises and human resource training agencies in research areas This approach helped in bringing about a general insight into the research topic

6 Contributions of the thesis

In terms of theories, relying on theories related to human resource and human resource development, industrial economics and industrial development; the thesis explained that the development of industrial parks would help in increasing size, changing structure, improving labor quality and enhancing labor efficiency of industrial sector based on industrial labor’s contribution to socio-economic development Also, the thesis constructed criterion for the evaluation on affecting factors on the role of industrial parks for human resource development in the industrial sector

In terms of practice, based on its secondary and primary data, the thesis generalized reality of industrial parks’ role for human resource development in industrial sector in Hai Phong This was proved by impact of industrial parks on changes of human resource size and its increasing rate through research years as well as changes of human resource structure in terms of educational background, technical level and formation of working style Thanks to practical analysis in Hai Phong, the thesis clarified limitations related to three aspects: i) Quantity: the size of labor attracted to work in industrial parks was still low compared with the competence of these areas; jobs of some labor was unstable due to high rate of employment termination; percentage of limited-term labor contract was rather high; the status of changing jobs was huge; ii) Structure: the rate of skilled labor was low; the rate of unskilled labor was quite high (about 50%, even more than 50% of labor in industrial sector); the status of imbalance within skilled labor was apparent; the rate of female labor was high; the rate of foreign expert labor was huge (nearly 2%) within strcuture of industrial park labor; iii)Quality: industrial-based working style of labor in industrial parks was poor

Based on the above analysis, the thesis proposed three perspectives, three directions and five solutions to solve current problems If these proposals are applied in reality, they would help in improving the role of industrial parks for human resource development in industrial sector in order to promote socio-economic development in certain coastal provinces in Red river delta

CHAPTER 1 LITERATURE REVIEW AND RESEARCH METHODOLOGY TO STUDY THE ROLE OF INDUSTRIAL PARKS FOR HUMAN

RESOURCE DEVELOPMENT IN INDUSTRIAL SECTOR IN PROVINCES AND CITIES

1.1 Literature review on domestic and international publications related to research topic

The thesis provided a literature review on domestic and international studies related to industrial parks, human resource development, impacts of industrial parks on human resource development and essential conditions Then, it pointed out research gap and determined research contents for the thesis topic

Diagram 1 Thesis’ frame for analysis Affecting factors

- Legislative environment and policy mechanism

- Management by the state - Activities for human resource development by firms in industrial parks - Participation by socio and

occupational organizations for human resource development

- Indicators for human resource development in industrial sectors: quantity, structure and quality - Indicators for evaluation on socio-economic efficiency of human resource

Perspective, direction and solution to improve the role of industrial parks for human resource development in industrial sector

ii)The role of industrial parks for human resource development in industrial sector: regarded as dependent variable reflecting outputs; clarifying the contribution of industrial parks to increase in quantity (size), changes in structure and improvement in quality; which helped in enhancing socio-economic efficiency of human resource in industrial sector

iii)Research indicators: including indicators to evaluate the role of industrial parks for human resource development in terms of its quantity, structure and quality; as well as those to evaluate socio-economic efficiency of human resource in industrial sector

Second, theoretical basis of the thesis was derived from perspective of political economy with combination of theories on industrial development and human resource development to study impacts of human resource changes in industrial sector on human resource development in the industrial sector

Third, data collection and processing The thesis described primary and secondary data applied Concerning primary data, the thesis collected this kind of data thanks to the questionnaire with labor (M1); questionnaire with company managers in the industrial parks (M2); questionnaire with the State leaders and researchers (M3); and in-depth interview questions with training insitutions (M4) The thesis clarified structure and design of each questionnaire; applied Likert 5 scale; and selected research sample with 316 M1+ 102 M2+ 104M3+ 3 M4= 525 in total of all questionnaires accompanied with appropriate data processing methods

In addition, the thesis collected data based on in-depth interview with local leaders in Nam Dinh and Ninh Binh

Concerning secondary data, the thesis used reports by General Statistical office, People’s Committee, Management Board of industrial parks in Hai Phong, Nam Dinh, Ninh Binh as well as reports extracted from studies published in domestic and international journals

CHAPTER 2 THEORETICAL ISSUES AND PRACTICAL

EXPERIENCE ABOUT THE ROLE OF INDUSTRIAL PARKS FOR HUMAN RESOURCE DEVELOPMENT IN THE INDUSTRIAL SECTOR IN

PROVINCES AND CITIES

2.1 Industrial parks and human resource development in industrial sector 2.1.1 Industrial parks and their benefits for socio-economic development 2.1.1.1 Industrial parks: Definition and typical features

Based on analysis into different concepts, it was concluded in the thesis that industrial parks refer to areas serving industrial development with specific plans These places specializing on manufacturing industrial outputs and carrying out services for industrial

production, which are clearly defined in terms of geographical boundaries Within industrial parks, there might be manufacturing areas or manufacturing firms Industrial parks are licensed for investment by the Government for their typical features of techncial infrastructure and legislative frame

Based on their functions, geographical space, establishment authority and market scope, industrial parks’ features were clarified in the thesis

2.1.1.2 Benefits of industrial parks for socio-economic development

It was supposed in the thesis that the development of industrial parks should harmonize with all benefits, reflecting objectives of investors and those of the countries building the industrial parks

2.1.2 Human resource development in industrial sector: Definition and features

2.1.2.1 Human resource and human resource development

First, manpower and human resource The thesis pointed out that manpower would refer to human’s power which belongs to each human and making a person active Manpower means labor and the workforce including people at specific age who use their physical power, intellectuality, brain and muscle to create properties

The thesis differentiated manpower and human resource.

Second, human resouce development The thesis analyzed human resource development at micro and macro levels At macro level, human resource development should be understood as the system of methods and policies to increase size, change structure and improve quality of the manpower At micro level, human resource development refers to policies and methods in terms of labor recruitment, training activities, employment and treatment; which have been implemented to guarantee quantity, structure and quality of human resource for enterprise operation The thesis focused on human resource development at macro level

2.1.2.2 Human resource development in industrial sector

First, features of human resource in industrial sector In the scope of this thesis, industrial human resource covers people currently working and holding different positions during manufacturing process They might be workers or managers in firms, enterprises of the industrial sector Main features of human resource in the industrial sector are comprised of its complexity, high specialization and standardization with strict discipline and attitude as well as strong connection during the manufacturing process

Second, human resource development in industrial sector The thesis supposed that human resource development in the industrial sector refers to the process of increasing human resource’s quantity, changing its structure and improving its quality in order to enhance operating performance for business of the firms

2.2 The role of industrial parks for human resource development of industrial sector: definition, contents, evaluation criterion and affecting factors

2.2.1 Definition of the role of industrial parks for human resource development in the industrial sector

Applying the meaning of “the role”, the thesis clarified that the role of industrial parks for human resource development in industrial sector refers to benefits of industrial parks in changes of quantity, structure and quality of human resource; which would contribute to the improvement in business performance of industrial human resource

2.2.2 Contents of industrial parks’ role for human resource development in industrial sector

The thesis analyzed contents of industrial parks’ role for human resource development in industrial sector with the following four aspects:

2.2.2.1 The role of industrial parks for human resource development in industrial sector based on increasing labor size

The thesis pointed out that the development of industrial parks would contribute to that of industrial’s labor in general This contribution depends on two trends namely labor attraction and termination

2.2.2.2 The role of industrial parks for human resource development in industrial sector based on changing labor structure

The thesis clarified concept of labor structure and classification of labor It analyzed training structure and specialization structure of the labor It also discussed trends in training structure changes, specialization structure changes and problems for skilled labor in industrial parks

2.2.2.3 The role of industrial parks for improvement in industrial labor’s quality

It was figured out in the thesis that labor quality in industrial sector would be reflected by mental power, moral power and physical power of labor working in the industrial sector as well as tehcnical level, occupational skills and working style of labor in this sector Within the research scope of the thesis, the author only investigated mental power and moral power of the labor

2.2.2.4 The role of industrial parks for improvement in socio-economic efficiency of industrial labor

The thesis supposed that the role of industrial parks for human resource development of industrial sector is reflected by not only their impact on changes of size, structure and quality of labor in industrial sector but also their contribution to the improvement of socio-economic efficiency based on business and production

activities of the firms, which would result in improvement of socio-economic efficiency for the whole industrial sector These concerns play an important role to the development of industrial sector, which on the one hand would reveal results of human resource development in this sector, and on the other hand would meet the ultimate objectves of labor, investors and the state

Based on the above analysis, the thesis pointed out scope of socio-economic efficiency of human resource in industrial sector thanks to the development of industrial parks

2.2.3 Criteria to evaluate the role of industrial parks for human resource development in industrial sector

2.2.3.1 Criteria to evaluate the role of industrial parks for the development of labor size in industrial sector

These criteria were comprised of 8 indicators: 1) Annual labor size in industrial parks; 2) labor growth rate in industrial parks;3) annual labor size in industrial sector; 4) annual labor growth in industrial sector;5) comparison between annual labor growth in industrial parks and annual labor growth in industrial sector; 6) ratio of labor in industrial parks and annual labor in industrial sector;7) rate of annual labor attraction to industrial parks; and 8) rate of annual labor terminiation in industrial parks

2.2.3.2 Criteria to evaluate the role of industrial parks for changes of labor structure in industrial sector

These criteria were comprised of 3 indicators: 9) number of annually trained labor; 10) percentage of trained labor in industrial parks; and 11) contribution rate of trained labor in industrial parks to the industrial sector

2.2.3.3 Criteria to evaluate the role of industrial parks for changes of labor quality in industrial sector

These criteria were comprised of 3 indicators: 12)contribution rate of specialized labor in industrial parks to the industrial sector; 13) contribution to occupational skill improvement of labor in industrial sector; and 14) contribution to working style improvement of labot in industrial sector

2.2.3.4 Criteria to evaluate the role of industrial parks for socio-economic efficiency improvement of labor in industrial sector

These criteria were comprised of 5 indicators:15) contribution rate of labor in industrial parks to the average production value of industrial sector;16) contribution rate of labor in industrial parks to the average export of industrial sector; 17) contribution rate of labor in industrial parks to average state budget of industrial sector;18) contribution rate of labor in industrial parks to labor’s average income of industrial sector and 19) contribution rate of labor in industrial parks to social security of labor in industrial sector

2.2.4 Affecting factors on the role of industrial parks for human resource development in industrial sector in provinces

2.2.4.1 State’s policies on human resource development (central and provincial levels) in industrial parks

The thesis clarified definitions of policies on human resource, their contents and requirements for the development of industrial parks

2.2.3.2 State’s management for the development of industrial parks in general and human resource here in particular

Based on the definition of State’s management for industrial parks and human resource development in these areas, the thesis analyzed key contents related to State’s operation and management for human resource development in industrial parks, such as building up human resource management board; building up and implementing human resource planning; investigating and supervising policy compliance and human resource planning activity as approved

2.2.3.3 Implementation for the management of human resource development in firms Based on the definition of management for human resource development, the thesis pointed out different issues that firms should guarantee to develop their humans In particular, these issues were comprised of creating favorable working environment and encouraging policies for human resource; building up good relationship between managers and direct production labor; and regularly paying attention to activities of recruitment, training and improvement for technical skills of the labor

2.2.3.4 Co-operation for human resource development in industrial sector Based on the the neccessity and significance of co-operation for human resource development in industrial sector, the thesis demonstrated that this co-operation should be carried out with precise functions and missions of stakeholders Accordingly, the thesis figured out specific functions and missions of the State, firms, training institutions and social organizations for human resource development goal

2.2.3.5 Competence of labor themselves in industrial sector

The thesis indicated that competence of labor working in firms located in industrial parks in pariticular and those in industrial sector in general should be comprised of knowledge, skills and attitude (industrial based working style) of each person, which would be formed and developed thanks to working process in industrial parks or industrial sector

In order to improve labor competence, the decisive factor is that labor should be active in practising to acquire knowledge, skills and attitude during production process In addition, working environment also puts important impact on labor’s competence improvement