Adjustments and potential benefits for employees in optimizing labor force

Transforming administrative landscapes: Navigating career transitions in a streamlined Vietnam

Adjustments and potential benefits for employees in optimizing labor force

The rapid tide of administrative reform sweeping through Việt Nam is leaving no stone unturned, shaking up the government, cutting public sector jobs, and opening opportunities for private enterprise — all while creating pressing challenges for career-minded individuals.

Kiều Công Thược, chairman of our website Development Fund (VNFund), echoes the sentiment that streamlining bureaucratic systems is no longer an isolated trend for Việt Nam, but a global movement. Many developed nations have embarked on significant workforce reductions in public administration, accompanied by policies to support the career journey of public-sector employees.

These initiatives extend beyond mere job placement, accommodating skills training, psychological adaptation, and integration into new labor markets. In the United States, for instance, the Trade Adjustment Assistance (TAA) program offers benefits and support to workers who lose their jobs due to international trade's impact.

South Korea, similarly, has implemented vocational transition policies for public-sector employees, providing training programs and financial support for businesses offering vocational training courses. A portion of labor insurance funds is allocated to cover these costs, provided the companies register and purchase labor insurance.

Thược emphasizes that, despite these successful models, Việt Nam faces hurdles in developing policies that cater to public-sector workers transitioning to the private sector. A significant challenge is the lack of a specialized vocational training framework for public employees after organizational restructuring.

Additionally, unique cultural barriers and mindsets contribute to this transition's obstacles. Many government employees are accustomed to a stable working environment, with fixed salaries, making it challenging for them to adapt to the fluid and performance-focused landscape of the private sector.

Drawing insights from international experience, Thược, identifies essential factors for a successful career transition, including early career orientation and counseling, skills training in alignment with labor market demands, financial support policies, collaboration with the private sector in creating new employment opportunities, and the elimination of institutional barriers to foster innovation, entrepreneurship, and lawful investments.

"Each phase requires proper policies to ensure flexibility and social stability," Thược stated emphatically.

Reducing excess, enhancing quality

Public-sector downsizing is an essential policy aimed at improving the efficiency of State governance, reducing the national budget's burden, and building a streamlined and transparent administrative system. This approach optimizes resources, modernizes public administration, and drives national development.

Supporting workers during career transitions not only alleviates unemployment pressure but also stimulates business growth, expands the labor market, and diversifies the workforce.

The CEO of VOVINAM Digital Bạch Ngọc Chië́n recognizes the need for streamlining as an inevitable part of development, viewing it as an opportunity to retain and nurture high-quality human resources within the State system. Public-sector employees transitioning to the private sector can offer significant advantage, owing to their systematic thinking and procedural knowledge, which can contribute significantly to private enterprises.

Chië́n supports implementing a performance evaluation system for Government employees to encourage contributions from high-quality personnel.

DOĂN Hữu TUỆ, the CEO of Mỹ Việt International Group, who worked for nearly 20 years at the State Bank of our website, shares a similar perspective. In 2011, he transitioned to a private company as an executive assistant. This decision offered him a more profound understanding of corporate structures.

He highlighted the stark differences between the public and private sectors, particularly concerning employee evaluation.

"Private businesses do not emphasize an employee's academic qualifications or past titles. What matters most is their actual contribution to the company, measured quantitatively based on efficiency," TUỆ affirmed.

Associate Professor Dr Đỗ Hương Lan, Director of the Institute for Policy and Management at the University of Social Sciences and Humanities, insists, "Career transition is not a loss but an opportunity for workers."

Under the Institute for Policy and Management's banner, the university has embarked on various studies, scientific conferences, and policy consultations on social security, labor, and employment. The Institute has also joined forces with businesses to develop the ROAD2NEXT career transition support ecosystem.

This multidimensional ecosystem assists public-sector employees in redefining their professional identities, unlock their latent skills, and tackle challenges they encounter while leaving the government sector. It also provides retraining, upskilling, and new career opportunities that align with market demands and individual capabilities.

Associate Professor Dr Lê Thị Thanh Hà, Deputy Director of the Institute of Philosophy at the Hồ Chí Minh National Academy of Politics, advocates for developing appropriate policies for Government employees who are directly affected by organizational restructuring.

With the decline in public sector recruitment, the labor market will shift towards manufacturing, business, and, most importantly, private enterprises and foreign-invested firms. A long-term and urgent solution involves removing institutional barriers, reforming administrative procedures, and improving the business environment substantially.

Policies should encourage innovation, entrepreneurship, and legitimate investments by businesses and individuals. - VNS

Additional insights

Supporting Career Transitions in Developed Countries

United Kingdom: Skills England: Focused on upskilling/reskilling workers for clean economy jobs. Though not exclusively for public employees, it includes programs applicable to those transitioning from government roles.
United States: Justice40 Initiative (Biden Administration): Primarily environmental, its focus on equitable workforce development in clean energy could overlap with public-sector transitions.
Just Transition Fund: Supports coal-dependent communities (including workforce development) through public-private collaborations.
Canada: Coal Community Transition Fund: Provides resources for economic diversification, including skills development and local business growth in Alberta. While designed for coal workers, comparable frameworks could apply to public-sector transitions.

Financial Mechanisms & Partnerships

EU-IFC Guarantee Program: €291 million to mobilize private investments for job creation, including SME support in clean energy and infrastructure.
Just Energy Transition Partnerships (JETPs): While initially for developing nations (e.g., South Africa's $8.5B deal), analogous blended finance models in developed countries could bridge public-private employment gaps.
Public-Private Workforce Programs: Efforts like impact investing and microfinance (highlighted in just transition frameworks) increasingly target cross-sector reskilling.

Phan Xuân Diện (right), a former official of the Con Cuông District Department of Agriculture and Rural Development (now Department of Agriculture and Environment), Nghệ An Province, with his medicinal plants after leaving his government job to build his own business. - VNA/VNS Photo

Kieuh Cong Thuoc, chairman of the Development Fund (VNFund), suggests that streamlining bureaucratic systems is a global movement, not just an isolated trend for Vietnam.
In the United States, the Trade Adjustment Assistance (TAA) program offers benefits and support to workers who lose their jobs due to international trade's impact.
South Korea has implemented vocational transition policies for public-sector employees, providing training programs and financial support for businesses offering vocational training courses.
Thuoc emphasizes that Vietnam faces challenges in developing policies that cater to public-sector workers transitioning to the private sector.
Cultural barriers and mindsets contribute to the transition's obstacles, making it difficult for government employees to adapt to the fluid and performance-focused landscape of the private sector.
Proper policies are essential to ensure flexibility and social stability during each phase of the administrative reform process.
Supporting workers during career transitions alleviates unemployment pressure and stimulates business growth, expands the labor market, and diversifies the workforce.
Baach Ngooc Chien, the CEO of VOVINAM Digital, views streamlining as an opportunity to retain and nurture high-quality human resources within the State system.
DOAhn Huu Tue, the CEO of My N Viet International Group, suggests implementing a performance evaluation system for government employees to encourage contributions from high-quality personnel.
Career transition is not a loss but an opportunity for workers, according to Associate Professor Dr Doan Huu Tue at the University of Social Sciences and Humanities.
The university has embarked on various studies, scientific conferences, and policy consultations on social security, labor, and employment, and has joined forces with businesses to develop the ROAD2NEXT career transition support ecosystem.
The Institute of Philosophy at the Ho Chi Minh National Academy of Politics advocates for developing appropriate policies for Government employees who are directly affected by organizational restructuring, and supports the removal of institutional barriers and improvement of the business environment.