Over the past 30 years, Vietnam has experienced significant
shifts of employment away from agriculture toward
manufacturing and services, away from household enterprises
toward registered and regulated businesses, and
away from state-owned enterprises toward private firms.
This paper argues that for these processes to continue
in the future, appropriately designed and implemented
labor market policies need to be in place, including labor
market regulations that protect workers but do not inhibit
creative destruction and creation of formal sector jobs;
labor market interventions that improve workers’ human
capital, eliminate information asymmetries, and are fiscally
sustainable; and labor market institutions that give
voice to workers and employers. As a part of all of these
measures, Vietnam will also have to renew its efforts
to integrate vulnerable groups into the labor market.