THE POTENTIAL EMIGRATION OF

VIETNAMESE SKILLED LABOUR

FORCE AFTER THE
ESTABLISHMENT OF ASEAN
ECONOMIC COMMUNITY IN 2015
VO NGOC DAN THANH,
B.A in INTERNATIONAL ECONOMIC RELATIONS
ADVISOR: Dr. HUYNH THI THUY GIANG

Ho Chi Minh City, 5/2015

CONTENTS
Intensity and driving forces of internal migration
in Vietnam
Model proposal - a survey of preparedness to
work in one of the ASEAN countries
Research results and Limitations

Recommendations

Model

Educational level: people with better education

are more likely to migrate

Familys relation: people who consider migration

as a households decision are less likely to
migrate.
Wage incentive: migrants move from lower
income areas to higher ones

Sjaastad (1962)

Harris

Todaro

(1970)

Hatton (1995)

Hong (2006)

Pasadilla (2011)

Determinants
Age : young people are more likely to migrate

GDP gaps: difference in national GDP cause

migration

Unemployment rates: workers at a high

unemployment rate area tend to change to lower
unemployment ones.

Trading relation between the host and the home

country

Social security: the ability to ascertain some

prerequisites such as housing, job, contract
security would encourage migration

Internal Migration in
Vietnam:
Intensity and Driving Forces

Trends of interprovincial migration rates

(migrants per 1,000 people) over time by
gender and age groups.

Source: Long & Phuong (2013), The rural urban

migration process

The shifting trend in

migration

Axis x: 1994 1999

Axis y: 2006 2007

City/ Urbanized Province

Source: Duc & Thinh (2008)

Wage
disparities
between
rural and
urban
areas in
Vietnam
as a
determina
nt of
migration

Source: Population & Housing Census 200

RESEARCH SURVEY:
Model Proposal, Sample description
and Descriptive statistics

LOGISTIC MODEL PROPOSAL

P(Yi = 1| Xi1, ....., Xim) = F(0 +
1Xi1 + 2Xi2 + ... + mXim ),
where F(z) = 1/(1+exp(-z))

F(z) is a logistic cumulative probability

distribution function
The impact of explanatory variable X
on probability that Yi = 1 is described
by marginal effect. For a continuous
variable (like age) marginal effect is
equal
to
change
in
predicted
probability in due to unit change in X,
while other variables are kept
constant at their mean values.

Sample Description
Vali
d

Frequen
cy
Other
5
Male
59
Female 36
Total
100

Percent

Valid
Percent
5.0
59.0
36.0
100.0

5.0
59.0
36.0
100.0

Cumulativ
e Percent
5.0
64.0
100.0

Age
14
12
10
8

F re q u e n cy

6
4
2
0
18

Age

Source: Calculation from the survey

19

20

21

22

23

24

25

26

27

28

29

30

32

40

Sample Description
Education
Doctor
Master
Higher Education Dip

Bachelor

Source: Calculation from the survey

data (2015)

Sample Description
Group 6

Group 5

Group 4

Group 3

Group 2

Group 1

10

15

20

25

30

35

40

45

Source: Calculation from the survey

data (2015)

Descriptive Statistics
Overall intention
Wish to move and
stay
Wish to move and
consider staying
Wish to move for a
limited period of time
Rather no
No
Have not thought
about it

Source: Calculation from the survey

data (2015)

Descriptive Statistics

Accepts
same
qualificati
on only
Accepts
lower
qualificati
on
Accepts
another

Preparedness to move
Wish to
Wish to
Wish to
move for
move and
move and
limited
consider
stay
period of
staying
time

Total

60%

74%

64%

67%

20%

13%

8.5%

11%

20%

13%
data (2015) 27.5%

Source: Calculation from the survey

22%

Descriptive Statistics
Current net monthly wage or benefit
Required
wage

<350

350 - 700

700 -

>1400

differenti

USD

USD

1400 USD

USD

7%

11%

10

13

25%

22

31

57%

40

54

100%

al
Less than
100 USD
100 - 200
USD
200 - 300
USD
> 300
USD
Total
number of
participan

Total

Descriptive Statistics
Housing and job security in the host country by
preparedness to move
Wish to
Wish to
Wish to
move for
move and

move and
limited
Total
consider
stay
period of
staying
time
No
requireme
0%
0%
0%
0%
nts
Housing
0%
0%
9%
6%
only
Job only
25%
17%
37.5%
30%
Both job
and
75%
83%
53.5%
64%
Source: Calculation from the survey
housing
data (2015)

Descriptive Statistics
Required prerequisites to migrate by preparedness to
move
Wish to
Wish to
Wish to
move for
move and

move and
limited
Total
consider
stay
period of
staying
time
Contract
with an
100%
83%
65%
71%
ASEAN
employer
Contract
with
ASEAN
0%
17%
35%
29%
recruitme
Source: Calculation from the survey
nt agency
data (2015)

Descriptive Statistics
Preferred destinations
Singapore
Malaysia

11%

Thailand
Other countries

5%

13%
71%

Source: Calculation from the survey

data (2015)

Research Results
Explanatory variables
Age (coef. and marginal
effect x 10)
Education

Coef.
t-value Marginal effectb
- 0.007 - 0.80
-0.007

High school diploma

0.061

0.31

0.006

Bachelor

-0.155

-0.77

-0.017

Master

0.831

1.58

0.064

Doctor
Net monthly income

-0.492

-0.62

-0.062

Less than 350 USD

0.880

2.63*** 0.075

350 - 700 USD

0.283

1.60

0.030

700 - 1400 USD

Familys relation
Social security

0.401
-0.310
1.293

2.31**
-2.13**
3.42**

0.041
-0.033
0.083

Research Results
1.2
1
0.8

Predicted probability

0.6

Age
Linear (Age)

0.4
0.2
0
15 20 25 30 35 40 45
Age

Predicted probability that a skilled worker decide

to move to one of the ASEAN countries by age.

Research Results
1.2
1
0.8

predicted probability

0.6

wage
Linear (wage)

0.4
0.2
0
0.5 1 1.5 2 2.5 3 3.5 4 4.5
Wage

Predicted probability that a skilled worker decide

to move to one of the ASEAN countries by wage.

Limitations
Disproportional sampling
Not explaining the decision of
permanent or temporary migration

POLICY
RECOMMENDATIONS:
Impacts summary and Recommended
measures

Impacts summary
Scenerio
Loss of young
educated workers
Return of migrants
at retirement age.
Intensive outflow
of a particular
sector
Diffusion of new
knowledge
Technology knowhows
Remittances

Result
Aging labour force

Impact type
Negative

Brain drain
Aging population

Negative

Social welfare burden

Imbalance in sectorial Negative
economy
Foster economic
development

Positive

Increase in foreign
currency reserve

Positive

Supporting measures
Labour force must be trained to be ready
for learning and adapting to the new
environment
Initiate intensive training for students to
better prepare them for the upcoming
future (which includes learning ability,
adaptability,
communication
skills,
awareness of AEC ...)

THANK YOU FOR YOUR ATTENTION!