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

1 PREFACE In this summary dissertation, all figures and tables are numbered as in dissertation Each year, Vietnam economy have more than 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 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: 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? Is there any significant difference between the level of competitiveness of labor export as perceived by the international employers and the international workers? Is there a significant difference in the perceived competitiveness of labor export across countries? 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 n= N + N * e2 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 research separately Ten employees per country were selected for each working area with a country 5 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 destination countries and 480 correct working employees from labor export countries They were selected randomly from three biggest enterprises of each sector Table Distribution of the Respondents by Working Area, 2012 Area International Employees Vietnamese Pilipino Garment International Employers Thai Indonesian Japan Taiwan S.Korea 30 30 30 30 9 30 30 30 30 9 Navigation 30 30 30 30 9 Home service 30 30 30 30 9 Total by group 120 120 120 120 36 36 36 Production and construction Total 480 108 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 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 / Very confident Excellent 3.40 – 4.19 Competitive / Less expectation / Moderate confident Good 2.60 – 3.39 Neutral / Average expectation / Normal Fair 1.80 – 2.59 Less competitive / Moderate expectation / Less confident Poor 1.00 – 1.79 Uncompetitive / High expectation / Not confident Very Poor 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 = B + B * AP + B * TS + B * CS + B * PRPE + B * WS + B * WA + B * 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 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 (%) 16-30 71 30-40 21 40-50 Mean Std Deviation 34.5 10.25 Gender 38% Female Male 62% Marital status 29% Single Married 71% Highest Educational Attainment 4% 25% Secondary School High School Collenge graduate 71% Height and weight 8% 4% 1,4m-1,5m 1,5m-1,6m 1,6m-1,7m >1,7m 38% 50% 8% 4% 40kg-50kg 25% 50kg-60kg 60kg-70kg >70kg 63% 10 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 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 11 Comparison of Perceived Competitiveness of Labor Export across Countries Factors Vietnamese WM Academic Filipino Indonesian Thai Descriptive Descriptive Descriptive Descriptive WM WM WM Interpret Interpret Interpret Interpret 3.1 Fair 4.1 Good 2.6 Fair 3.6 Good 2.4 Poor 3.7 Good 2.8 Fair 4.0 Good 2.9 Fair 4.3 Good 3.2 Fair 3.6 Good N/A N/A N/A N/A N/A N/A N/A N/A 2.8 Fair Good 2.5 Poor 4.0 Good 3.1 Fair 3.4 Good 4.1 Good 4.0 Good 2.3 Poor 3.9 Good 3.2 Fair 3.9 Good 2.8 Fair 3.9 Good 3.1 Fair 3.9 Good performance Technical skill Communication skill Performance rating of previous employers Working seniority (in previous companies) Working attitude Compliance with compliance with labor contract Average WM Ranking of factor priority of International employers’ perception Factors Japanese Korean Taiwanese Average Academic Performance 2.1 1.2 1.7 1.7 Technical Skill 3.4 3.3 3.2 3.3 Communication Skill 5.6 2.5 2.2 3.4 N/A N/A N/A N/A 1.6 4.2 4.3 3.4 5.1 5.2 5.2 5.2 5.3 5.7 5.8 5.6 Performance rating of previous employers Working seniority (in previous companies) Working attitude Compliance with labor contract 12 In perception of international employees, compliance with labor contract is the most important factor influencing to their decision when they select their employees Working attitude is the second important Technical skill, communication skill, working seniority are the same level of importance in their perception International employers not concern about performance rating of previous employers Japanese employers emphasize communication skill factor are the most important Working attitude and compliance with labor are the second, while working seniority is not much necessary Korean and Taiwanese employers have same opinion that working attitude and compliance with labor contract are two most important factors Next are working seniority and technical skill Perceived Competitiveness of Vietnamese Labor Export We can see the gaps between Vietnamese and other candidates within ASEAN Vietnamese labors got trouble, such as: Low education attainment, lack of technical skills, weak solving skill during working time, communication capacity is weak, difficulties when communicate with colleagues, employers and foreigners, limited working seniority, trouble with team-work and adaptability in the workplace in foreign companies and experience about the future job Especially, violent contract is a weak point of Vietnamese labors affecting to employers’ decision when they recruit employees We need to concern more about this issue Factors Affecting Labor Competitiveness Linear regression equation takes the following form LC = 0.358*AP + 0.266*TS + 0.308*CS + 0.299*WS + 0.302*WA The paper gave the level of impact and priority in selecting applicants were interpreted fully and clearly According to regression results base on respondents’ perception, the most important factor affecting to labor competitiveness is academic performance, followed by communication skills, working attitude, working seniority and finally technical skill factor According to employer’s ranking, the most important factor affecting to labor competitiveness is compliance with labor contract, followed by working attitude, working seniority, communication skills, technical skills and academic performance 13 factor Regarding to international employers, they not care about performance rating by previous employers Comparison of respondents’ perception according to personal-related profile Indicator AP TS CS PRPE WS WA CWLC LC Age 781 Gender 924 Marital status Highest Educational Height Weight Attainment 119 045 798 Accept Null Accept Null Accept Null Reject Null Accept Null Accept Null 795 546 1.00 642 Accept Null Accept Null Accept Null Accept Null Accept Null Accept Null 044 084 065 309 615 Reject Null Accept Null Accept Null Accept Null Accept Null Accept Null 162 040 219 309 412 Accept Null Reject Null Accept Null Accept Null Accept Null Accept Null 148 418 331 524 Accept Null Accept Null Accept Null Accept Null Accept Null Accept Null 449 446 913 927 Accept Null Accept Null Accept Null Accept Null Accept Null Accept Null 597 702 041 822 Accept Null Accept Null Accept Null Reject Null Accept Null Accept Null 406 184 006 697 Accept Null Reject Null Accept Null Accept Null 252 354 954 752 213 Accept Null Accept Null 768 803 179 121 630 929 637 142 Testing the statistical difference of the respondents’ perceptions and their profile resulted to a value that age does not affect academic performance, technical skills, performance rating of previous employers, working seniority, working attitude, compliance of labor contract and labor competitiveness, except communication skills Gender does not lead differences to independent and dependent variables, except performance rating by previous employers Marital status does not lead 14 differences to independent and dependent variables, except performance rating by previous employers Highest education attainment lead differences to academic performance, compliance of labor contract and labor competitiveness Height and weight does not affect to independent and dependent variables The proposed improvements This study concentrated on the specific factors perceived to be problems and limitations affecting the competitiveness of Vietnamese labors These relate some issues need to be improved, such as: Education level, technical skills, soft techniques, communication skills, especially language capacity, working seniority, team-work skill, information about cultural, working style of expected destination, and working attitude Chapter SUMMARY OF FINDING, CONCLUSIONS AND RECOMMENDATIONS Based on the survey data, the variables are detailed in the article comments The following conclusions were made on objective criteria Conclusions From the findings of the study, the following conclusions were obtained: The profile of the respondents’ subjected under study was considered sufficient and reliable enough to arrive at an accurate analysis and evaluation of labor competitiveness Vietnamese government needs to improve their export labor competitiveness by improving labors’ education level, technical skill, communication skill, working seniority and working attitude They are very important factors, which influence to decision of international employers Comparing with other countries, Vietnamese labors are lowest competitiveness, especially in term of technical skills, working seniority and communication skills Though there were some limitations identified which were related more to education level, technical skills, solving skill during working time, communication 15 capacity, working seniority, team-work skill, adaptability capacity in the workplace in foreign companies, experience about the future job and working attitude To improve the competitiveness of Vietnamese labor, the study suggested improvements on education level, technical skill, communication skill, working seniority and working attitude Recommendations The result of this study is envisioned to contribute knowledge to effective and efficient management: Based on analysis of this paper, Vietnam’s government will build special action plans to improve competitiveness of Vietnamese labors; For the Vietnamese laborers, this study will help them understand their strong and weakness In addition, laborers also know the requirements from international employers, then they can prepare and study to improve their abilities and easier to get success in the future Hence, the Vietnamese government must regularly conduct annual employers’ evaluation surveys to update international managers’ feedback about competitiveness of Vietnamese labors and to decide for necessary improvements Hence, we can apply some below solutions: Labor contract Gvernment should adjust legal systems regarding labor export policies to prevent violent contract, such as: (1) Treat huge punishment to labor and relative people if they get violet contract, especially with run-away situation; (2) Give priority with labor and relative people, who comply with labor contract; (3) Building special courses about international working environment in schools and colleges, specially with people who plans to work abroad Academic performance The Vietnamese government should build plans to improve education level of Vietnamese labors: (1) Opening free or low fee courses for supplementing essential knowledge; (2) Support tuition fee for poor people; (3) Supplementing tools for studying, such as: Internet, personal computer, etc Technical skills The Vietnamese government should build plans to improve technical skills of 16 Vietnamese labors: (1) Opening free or low fee courses for supplementing soft techniques; (2) Opening vocational centers freely; (3) Training necessary technical skills for people who plan working oversea Communication skills Supporting and improving communication skills for Vietnamese labors: (1) Designing and teaching language courses for learners from primary schools (2) Opening free or low fee language courses with popular languages: English, Korean, Japanese, Chinese, etc; (3) Opening free or low fee communication class to make applicants more confident when communicating with foreigners Working seniority Enhancing working seniority for Vietnamese labors: (1) Opening vocational class for practicing; (2) Cooperate with some production enterprises in Vietnam to help applicants have chance to practice; (3) Increasing team-work skill by providing and giving them free or low fee lectures about legal system, culture and working style of country, which they want to apply Working attitude Propagating and training working attitude for Vietnamese labors: (1) Design orientation training about legal issues, damages and potential dangers when labor violate contract These courses will be deliver by lawyers (1) Give them lectures about expected destinations and the way to solve professional working style; (2) Invite some Vietnamese labors, who worked oversea, give lectures about their travelling and differences between Vietnam and other countries and requirement of international employers [...]... attitude and compliance with labor are the second, while working seniority is not much necessary Korean and Taiwanese employers have same opinion that working attitude and compliance with labor contract are two most important factors Next are working seniority and technical skill Perceived Competitiveness of Vietnamese Labor Export We can see the gaps between Vietnamese and other candidates within ASEAN Vietnamese. .. Cooperate with some production enterprises in Vietnam to help applicants have chance to practice; (3) Increasing team-work skill by providing and giving them free or low fee lectures about legal system, culture and working style of country, which they want to apply Working attitude Propagating and training working attitude for Vietnamese labors: (1) Design orientation training about legal issues, damages... communication skills, technical skills and academic performance 13 factor Regarding to international employers, they do not care about performance rating by previous employers Comparison of respondents’ perception according to personal-related profile Indicator AP TS CS PRPE WS WA CWLC LC Age 781 Gender 924 Marital status Highest Educational Height Weight Attainment 119 045 798 Accept Null Accept Null Accept... strong and weakness In addition, laborers also know the requirements from international employers, then they can prepare and study to improve their abilities and easier to get success in the future Hence, the Vietnamese government must regularly conduct annual employers’ evaluation surveys to update international managers’ feedback about competitiveness of Vietnamese labors and to decide for necessary...11 Comparison of Perceived Competitiveness of Labor Export across Countries Factors Vietnamese WM Academic Filipino Indonesian Thai Descriptive Descriptive Descriptive Descriptive WM WM WM Interpret Interpret Interpret Interpret 3.1 Fair 4.1 Good 2.6 Fair 3.6 Good 2.4 Poor 3.7 Good 2.8 Fair 4.0 Good 2.9 Fair 4.3 Good 3.2 Fair 3.6 Good N /A N /A N /A N /A N /A N /A N /A N /A 2.8 Fair 4 Good 2.5... affecting the competitiveness of Vietnamese labors These relate some issues need to be improved, such as: Education level, technical skills, soft techniques, communication skills, especially language capacity, working seniority, team-work skill, information about cultural, working style of expected destination, and working attitude Chapter 5 SUMMARY OF FINDING, CONCLUSIONS AND RECOMMENDATIONS Based on the... the survey data, the variables are detailed in the article comments The following conclusions were made on objective criteria Conclusions From the findings of the study, the following conclusions were obtained: 1 The profile of the respondents’ subjected under study was considered sufficient and reliable enough to arrive at an accurate analysis and evaluation of labor competitiveness 2 Vietnamese government... improve their export labor competitiveness by improving labors’ education level, technical skill, communication skill, working seniority and working attitude They are very important factors, which influence to decision of international employers Comparing with other countries, Vietnamese labors are lowest competitiveness, especially in term of technical skills, working seniority and communication skills... is a weak point of Vietnamese labors affecting to employers’ decision when they recruit employees We need to concern more about this issue Factors Affecting Labor Competitiveness Linear regression equation takes the following form LC = 0.358*AP + 0.266*TS + 0.308*CS + 0.299*WS + 0.302*WA The paper gave the level of impact and priority in selecting applicants were interpreted fully and clearly According... and teaching language courses for learners from primary schools (2) Opening free or low fee language courses with popular languages: English, Korean, Japanese, Chinese, etc; (3) Opening free or low fee communication class to make applicants more confident when communicating with foreigners Working seniority Enhancing working seniority for Vietnamese labors: (1) Opening vocational class for practicing;