A Study on the Employment Situation of Vietnamese Workers

The study on the employment situation of Vietnamese workers shows that Vietnam’s labor market was strongly affected by the COVID-19 pandemic in 2020, with the labor force and the number of employed people declining significantly in 2021. However, by 2022, the market began to recover and is expected to nearly return to pre-pandemic levels by 2024. The unemployment rate has continuously decreased and remained low, yet disparities in job opportunities still exist between men and women, and between urban and rural areas. The labor structure has been shifting towards urbanization and industrialization, with the non-state sector and foreign direct investment (FDI) enterprises playing a key role in job creation. To ensure sustainable labor market development, several solutions are necessary: focusing on reskilling workers, narrowing the gender gap, expanding employment opportunities in rural areas, attracting high-quality FDI associated with technology transfer, and improving job quality while ensuring social security.

Introduction

Employment is a labor activity that generates income for individuals in compliance with the law. It is a central factor in ensuring livelihoods while contributing to economic growth and social stability. Therefore, the Vietnamese Government has issued a series of legal documents related to this issue. These include the Labor Code 2019,Resolution No. 06/NQ-CP dated January 10, 2023, on developing a flexible, modern, efficient, sustainable, and internationally integrated labor market to support socioeconomic recovery; Decree No. 38/2022/NĐ-CP dated July 1, 2022, stipulating minimum wages for employees working under labor contracts; Decree No. 42/2023/NĐ-CP on adjustments to pensions, social insurance allowances, and monthly benefits; and Decree No. 70/2023/NĐ-CP amending Decree No. 152/2020/NĐ-CP on regulations concerning foreign workers in Vietnam and the recruitment and management of Vietnamese workers employed by foreign organizations and individuals in Vietnam, among others.

In practice, Vietnam continues to face numerous challenges: informal employment still accounts for a large proportion (over 60%), job quality remains uneven and gender inequality and the urban–rural divide are still evident. In this context, studying the employment situation of Vietnamese workers is necessary to identify labor market shifts, skill requirements, and job quality. This will serve as a foundation for timely and appropriate policy recommendations, in line with the requirements of sustainable recovery and international integration.

Literature Review

Employment

According to the International Labour Organization (ILO), employment refers to people above a specified age who, during a given reference period, such as a week or day, engage in work either for pay or profit, including self-employment. Accordingly, they are considered employed if they: (i) perform some work for wages or salaries in cash or in kind; (ii) have a formal job attachment but are temporarily absent from work during the reference period; (iii) engage in some work for profit or family gain, in cash or in kind; or (iv) work for an enterprise such as a business establishment, farm, or service unit, but are temporarily not at work for specific reasons, which is understood as being “in paid employment” (United Nations Development Programme (UNDP), 2012).

According to Article 9 of the Labor Code 2019, employment can be understood as a labor activity that generates income and is not prohibited by law. Labour Code (2019) The State, employers, and society share the responsibility to addres employment issues, ensuring that everyone with working capacity has the opportunity to obtain a job.

Coalification of Employment

Classification by Digital Platforms–the Gig Economy Includes Two Types of Work

Group 1. Crowd-based work models (web-based platforms): Workers completing a series of tasks through online platforms. Typically, these platforms connect an unlimited number of organizations and individuals via the Internet, enabling customers and service providers (workers) to connect globally. These are online jobs carried out on digital platforms, based on websites that are unrestricted by geographical distance. They include freelance jobs in various fields such as design, translation, programming, small tasks, and medical consulting. They also cover self-employment activities, such as content creation, YouTubers, bloggers, product reviewers, and online survey respondents.

Group 2. Work-on-demand via apps (location-based platforms): This refers to traditional activities (transportation, cleaning, household chores, administrative/clerical work) that have been transferred to digital platforms and managed by businesses. These businesses intervene by setting minimum service standards, and controlling recruitment and workforce management. In other words, such jobs rely on digital platforms, but are geographically restricted, typically operating alongside services provided by the traditional labor market. Examples include ride-hailing (Grab and Uber), food delivery (Meituan, UberEats, and GrabFood), domestic work, home services, and care services.

Classification by Skill Level–Employment in the Gig Economy Includes

Group 1. High-skilled/creative jobs (freelancers): Usually carried out online through digital applications, including work related to information technology (IT) and programming, design, graphics, architecture, translation, writing, finance, banking, cybersecurity, and other freelance jobs (e.g., programmers, cybersecurity experts, YouTubers, bloggers, photographers, video editors, freelance writers, financial/business analysts).

Group 2. Medium- and low-skilled jobs: Usually carried out on-site, involving technology platform-based services, such as transportation, delivery, household services, care work, cleaning, and home repairs. These workers are often considered self-employed (part-time, juggling multiple jobs without a fixed occupation).

Combined classification by skills and digital platforms: There are three determining factors to differentiate types of platform-based work: (i) mode of service provision (online or on-site) – this affects workers’ health, safety, and working conditions; (ii) required skill levels (from high to low) – determining whether tasks can be crowd-sourced or require specific skills; and (iii) task allocation entity (platform, customer, or platform worker), showing the degree of control exerted by the platform or customer over the worker.

Based on these, there are four types of platform-based jobs:

Type 1. Low-skilled, on-site work (e.g., ride-hailing with Uber, Lyft; delivery/transport services like Deliveroo, Foodora).

Type 2. Highly skilled, on-site work (professional services and household services such as ListMinut, Book a Tiger, Helping, care services, and cleaning services).

Type 3. Low-skilled, online work (e.g., Amazon Mechanical Turk, Clickworker).

Type 4. Highly skilled, online work (e.g., graphic design on 99designs; translation on Gengo, finance, cybersecurity, marketing on Gignow, and other freelance work on TaskRabbit and Upwork).

Research also shows that low-skilled on-site jobs are usually allocated by the platform, while customers and platform workers retain greater control over high-skilled tasks (Buiet al., 2021).

Method

This study uses secondary data from the General Statistics Office (GSO) for the period 2010–2024 to analyze the current employment situation of Vietnamese workers, thereby proposing several policy recommendations to enhance the efficiency of labor utilization.

Results and Discussion

Employment Situation of Vietnamese Workers

During the period 2020–2024, Vietnam’s labor force aged 15 years and above experienced significant changes. In 2020, the total labor force reached 54.8 million people; however, in 2021, it dropped sharply to 50.6 million—a decline of about 4.3 million people, equivalent to 7.8%. The primary cause was the severe impact of the COVID-19 pandemic, which disrupted business and production activities, leading to widespread job loss and reduced working hours. From 2022 onwards, the labor force began to recover gradually, increasing year by year, and is expected to reach 52.9 million by 2024. Nevertheless, it has not yet fully returned to its pre-pandemic level, (Table I).

Table I. Labor Force at 15 Years of Age and above by Sex and by Residence

Year	Total	By sex		By residence
		Male	Female	Urban	Rural
2020	54842,9	28866,1	25976,8	18171,9	36671,0
2021	50560,5	27041,3	23519,2	18535,0	32025,5
2022	51704,9	27527,1	24177,8	19211,6	32493,3
2023	52376,0	27868,9	24507,1	19572,5	32803,5
Prel. 2024	52942,3	28255,1	28257,2	20400,0	32542,3

By gender, the male labor force has consistently accounted for a higher proportion than the female labor force, with a stable gap of about 3.3–3.5 million people each year. Female employment declined sharply in 2021 (falling to only 23.5 million people), but gradually recovered afterwards, reaching nearly 24.7 million by 2024, although it still does not return to the 2020 level.

The trend of urbanization is clearly reflected in the data by the area of residence. While the urban labor force continuously increased from 18.2 million in 2020 to around 20.4 million in 2024, the rural labor force declined sharply in 2021 and only showed a slight recovery in the following years. The share of urban labor rose from 33.1% in 2020 to 38.5% in 2024, indicating a shift in workers from rural to urban areas in search of better job opportunities, in line with industrialization and the development of the service sector (Table II).

Table II. Number of Employed Persons in the Economy by Type of Ownership

Year	Total	State	Non-state	Foreign investment sector
2020	53609,6	4098,4	44777,4	4733,8
2021	49072,0	3951,7	40534,0	4586,3
2022	50604,7	3995,0	41533,2	5076,5
2023	51287,0	4046,8	41978,8	5261,4
Prel. 2024	51860,3	4018,8	42463,4	5378,1

In general, Vietnam’s labor force has been gradually increasing since the pandemic, with notable shifts by gender and residence. This provides an important basis for policymakers to design appropriate strategies for sustainable labor market development, supporting vulnerable groups such as women and rural workers while also taking advantage of the urbanization process.

The number of employed workers in Vietnam during the period 2020–2024 experienced significant fluctuations due to the impact of the pandemic, but overall, it has shown positive signs of recovery. In 2020, the total employment reached approximately 53.6 million people. However, by 2021, this figure dropped sharply to 49.1 million-a decline of more than 4.5 million workers, reflecting the severe negative impact of the COVID-19 pandemic on the labor market. From 2022 onwards, employment has gradually recovered, reaching 51.3 million in 2023 and is estimated at 51.9 million in 2024.

In the ownership sector, the non-state sector has consistently accounted for the largest share of employment, with about 44.8 million workers in 2020, maintaining a slight upward trend over the years, and is expected to reach 42.5 million workers by 2024. Despite the decline in 2021, this sector remains the main pillar of job creation in the economy. The foreign direct investment (FDI) sector also shows an expansionary trend, with the number of employed workers rising steadily from 4.7 million in 2020 to 5.4 million in 2024, reflecting the strong appeal of FDI to Vietnam’s labor market, particularly in manufacturing industries and global services. In contrast, the state sector remained relatively stable, employing around four million workers throughout the period, with no significant fluctuations.

The analysis highlights that the non-state and FDI sectors play an increasingly important role in job creation, while the state sector functions more as a stabilizing force than as a driver of growth. These trends clearly reflect Vietnam’s economic restructuring and international integration, while underscoring the need to enhance workforce quality, especially in the private and foreign-invested sectors, to meet development demands in the new context.

During the period 2020–2024, total employment in Vietnam fluctuated significantly owing to the pandemic’s impact. Million people were employed in 2020; however, this figure dropped sharply to 49.1 million in 2021, a decline of nearly 4.6 million, marking the period when the labor market was hardest hit by COVID-19. From 2022 onwards, employment began to recover, reaching an estimated 51.9 million in 2024, approaching the pre-pandemic level.

By gender, male employment has consistently been higher than female employment, accounting for 53%–54% of the total throughout the period. In 2020, there were 28.3 million employed men compared to 25.3 million employed women. Both groups declined sharply in 2021 but recovered considerably in subsequent years. By 2024, the employed labor force is estimated at approximately 27.7 million men and 24.2 million women. Despite similar recovery patterns, female employment has not yet returned to the 2020 level.

By residence, a clear disparity emerged between urban and rural workers. Rural employment has always accounted for the majority 67%–70% of total employment). However, urban employment has shown a gradual upward trend, increasing from 17.5 million in 2020 to nearly 20 million in 2024, while rural employment has tended to decline slightly or remain stable. This reflects the urbanization process and economic shift from agriculture to industry and services (Table III).

Table III. Number of Employed Persons in the Economy by Sex and by Residence

Year	Total	State	Non-state	Foreign investment sector
2020	53609,6	4098,4	44777,4	4733,8
2021	49072,0	3951,7	40534,0	4586,3
2022	50604,7	3995,0	41533,2	5076,5
2023	51287,0	4046,8	41978,8	5261,4
Prel. 2024	51860,3	4018,8	42463,4	5378,1

In summary, the period 2020–2024 illustrates Vietnam’s gradual labor market recovery following the COVID-19 shock. The recovery is evident across gender and residential groups, yet disparities remain, particularly for women and rural workers who have not fully regained pre-pandemic employment levels. These trends provide a crucial basis for designing employment recovery policies, supporting vulnerable groups, and fostering the development of a modern and sustainable labor market.

During the period 2020–2024, the unemployment rate of the working-age population in Vietnam showed a downward trend after peaking in 2021 owing to the severe impact of the COVID-19 pandemic. Specifically, the unemployment rate has risen from 2.48% in 2020 to 3.20% in 2021, which is the highest level of unemployment. It then gradually improves, declining to 2.34% in 2022 and 2.28% in 2023, and is estimated to decrease slightly further to 2.24% by 2024 (Table IV).

Table IV. Unemployment Rate of the Labor Force at Working Age

Indicator	2020	2021	2022	2023	Prel. 2024
Unemployment rate of labor force at working age by province	2.48	3.20	2.34	2.28	2.24
Urban	3.89	4.33	2.82	2.75	2.53
Rural	1.75	2.50	2.04	1.99	2.04
Unemployment rate of labor force at working age by sex	2.48	3.20	2.34	2.28	2.24
Male	2.01	3.15	2.36	2.30	2.23
Female	3.05	3.26	2.32	2.25	2.25

Female workers consistently had higher unemployment rates than their male counterparts, reflecting a degree of gender inequality in access to jobs. In 2021, the unemployment rate for women was 3.26% compared with 3.15% for men. Although the gap narrowed in subsequent years, by 2024, women’s unemployment remained at 2.25%, which is slightly higher than that of men at 2.23%. This finding suggests a continuing need for targeted employment policies for women, especially in sectors affected by the pandemic and restructuring, such as textiles, services, and tourism (Fig. 1).

Fig. 1. Unemployment rate of labor force at working age by sex. Source: General Statistics Office of Vietnam (2024).

Urban workers were more severely affected than rural workers throughout the study period. In 2021, the unemployment rate in urban areas will reach 4.33%, nearly double that of rural areas (2.50%). However, due to the economic recovery after the pandemic, the urban unemployment rate fell to 2.53% by 2024. Meanwhile, unemployment in rural areas, although consistently lower, remained relatively stable at around 2%, without the stronger improvement observed in urban areas. This indicates that rural workers, although less directly affected by economic shocks, also had fewer opportunities for employment improvement, (Fig. 2).

Fig. 2. Unemployment rate of labour force at working age by province. Source: General Statistics Office of Vietnam (2024).

In summary, the data show that the labor market has been recovering positively, particularly in urban areas, but notable disparities remain between men and women, and between urban and rural workers. Maintaining a low unemployment rate should go hand in hand with improving job quality and ensuring equal access to employment opportunities for all labor groups.

General Assessment

First, Vietnam’s labor market recovered after the COVID-19 pandemic. Following a sharp decline in 2021 (the labor force fell by 7.8% and the number of employed workers dropped by 8.5%), the key indicators gradually rebounded and nearly returned to pre-pandemic levels by 2024.

Second, the gender structure remains relatively stable; however, women continue to face disadvantages. The number of male workers has consistently exceeded female workers by about 3.3–3.5 million; and the female unemployment rate has been higher than that of men in most years, reflecting persistent inequalities in employment opportunities.

Third, there is a clear shift in labor toward urbanization. The share of urban workers increased from 33.1% in 2020 to 38.5% in 2024, while rural labor declined correspondingly. This trend highlights the transition in employment from agriculture to industry and services.

Fourth, the non-state and FDI sectors were the main drivers of job creation. The non-state sector accounts for approximately 82%–84% of total employment; the FDI sector has steadily expanded in scale, while the state sector has remained relatively small and stable.

Fifth, the unemployment rate has gradually declined and has remained at a low level. From its peak of 3.2% in 2021, the rate dropped to 2.24% by 2024. However, disparities persist between urban and rural areas as well as between men and women.

Some Policy Recommendations

First, skill development and worker reskilling were enhanced. Focus on digital, soft, and vocational skills to meet the labor demand of the FDI sector and the growing industrialservice sectors. Develop reskilling programs for workers affected by automation and structural shifts.

Second, the gender gap in employment has narrowed. Support flexible work arrangements, remote work, and entrepreneurship programs for women. Encourage enterprises to adopt gender equality policies for recruitment and promotion.

Third, employment opportunities have increased in rural areas. Promote rural economic development based on processing industries, community-based tourism, and green economy. Improve digital infrastructure in remote areas to enable online work and e-commerce.

Fourth, it attracts and expands high-quality FDI. Prioritize projects that employ skilled labor, use advanced technology, and strengthen linkages with domestic supply chains. Tie investment incentives to meet the requirements for training and technology transfer to Vietnamese workers.

Fifth, it stabilizes and improves employment quality. Beyond increasing job quantity, standards for occupational safety, income, and social insurance should be raised. Encouraging enterprises to adopt sustainable and work-friendly employment models.

Conclusion

During 2020–2024, Vietnam’s labor market was strongly affected by the COVID-19 pandemic, with a severe downturn in 2021, but it has steadily recovered since 2022 and approached pre-pandemic levels by 2024. The labor force and number of employed persons have gradually increased, while the unemployment rate has declined and remains at a low level. However, disparities remain in employment opportunities between men and women, as well as between urban and rural areas, job quality is uneven, and the labor structure is rapidly shifting toward industry and services, with heavy reliance on the non-state and FDI sectors.

To build a sustainable and inclusive labor market, several key solutions are required: (1) enhancing human capital by promoting reskilling and upskilling programs to meet the demands of the digital economy and industrialization; (2) narrowing the gender gap and supporting vulnerable groups, especially women and rural workers; (3) creating local employment opportunities through rural economic development, processing industries, and the green economy; (4) attracting high-quality FDI projects linked to technology transfer and improved labor standards; and (5) improving working conditions by ensuring income security, occupational safety, and social protection.

Conflict of Interest

The authors declare that they do not have any conflict of interest.