Vietnam is evolving from a traditional source of global labor into an importer of unskilled foreign workers, driven by rapid industrialization and an aging domestic population. This structural shift, evidenced by the arrival of laborers from countries like Bangladesh to fill manufacturing and construction gaps, mirrors the developmental trajectory of South Korea in the 1970s and 80s.
Demographic Pressures and the Shrinking Workforce
Vietnam’s labor market is tightening due to long-term demographic changes. According to national data, the share of the population aged 65 and older grew from 6.2 percent in 2005 to 9.5 percent in 2025. This aging trend is compounded by a rising age dependency ratio, which climbed from 43.1 percent in 2013 to 47.7 percent in 2024. As the elderly population is projected to reach 20.9 million by 2034, the number of young workers entering the labor force is expected to decline, creating a permanent gap in factory staffing.
Did you know?
In 2024, Vietnam had 14.2 million people aged 60 and older. By 2034, that number is expected to jump by nearly 7 million, significantly reducing the available pool of young manual laborers.
Industrial Expansion vs. Labor Availability
The demand for workers is outstripping local supply, particularly in industrial hubs. Bac Ninh Province faces a requirement to recruit over 230,000 new workers by 2026 to support its electronics manufacturing sector. Evidence of this shortfall appeared at a job fair last December, where 30 companies sought 35,000 workers but filled fewer than 10 percent of those positions. Major infrastructure projects face similar hurdles; the Long Thanh International Airport reported in April that it was short 5,500 workers against a target of 14,000.
Economic Upgrading and Changing Preferences
Vietnam’s transition toward higher-value industries is altering worker priorities. As the economy moves up the value chain, domestic workers are increasingly opting for higher-skilled roles or flexible work arrangements. Google Trends data shows consistent search interest in “freelancer” since 2023, suggesting many are moving away from the physical toll of construction and factory work. This shift means even as wages rise—with construction firms like Vingroup’s VinCons offering between VND 14 million and 47 million monthly—employers struggle to find local staff willing to fill manual positions.
Pro Tip:
Foreign investors should shift strategies away from the premise of “cheap, abundant labor.” Politburo Resolution No. 10, issued June 8, 2026, prioritizes high-quality foreign direct investment (FDI) in technology and innovation, signaling that the era of sweatshop-heavy manufacturing is nearing its end.
Managing the Regulatory Framework
Vietnam currently employs a restrictive approach to foreign labor. As of the end of 2025, there were 162,858 foreign workers in the country, with 86.2 percent classified as skilled professionals. Under the 2019 Labour Code, foreign nationals are generally limited to managerial, executive, expert or technical roles that locals cannot fill. Analysts suggest that for Vietnam to maintain its economic momentum, the government may need to introduce a more flexible legal framework that allows for the recruitment of foreign unskilled workers during genuine shortages while maintaining protections for the domestic workforce.
Comparison: Vietnam and the South Korean Model
Vietnam’s current situation is a historical echo of South Korea’s development. In the 1970s and early 1980s, South Korea was a major exporter of labor, sending miners and nurses to West Germany and construction workers to the Middle East. By the late 1980s, rising domestic wages and a shift in worker preferences forced South Korea to transition into a labor-importing economy. Vietnam is following this path, shifting from exporting its own labor—with over 700,000 Vietnamese working abroad in 2024—to filling domestic gaps with foreign personnel.
Frequently Asked Questions
- Why is Vietnam importing unskilled workers?
Vietnam is importing labor because its domestic workforce is shrinking due to an aging population and a shift toward higher-skilled, more flexible jobs. - Does this mean the Vietnamese economy is failing?
No. It indicates economic advancement. Similar to South Korea’s development, Vietnam is moving away from low-value manual labor as its economy climbs the value chain. - How many foreign workers are currently in Vietnam?
As of the end of 2025, there were 162,858 foreign workers, the vast majority of whom are skilled experts or managers.
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