Vocational Training and Labor Market Outcomes in Rural Vietnam

Bui Van Luong, Phuong Huu Khiem, Dinh Hong Linh, Nguyen Thanh Vu, Mai Viet Anh

Abstract

Skill development has become a major policy priority in many developing countries, with a strong emphasis on promoting vocational training programs. This study investigates the impact of vocational training on labor market outcomes in rural Vietnam, specifically focusing on monthly earnings and formal employment. The novelty of this research lies in its comprehensive approach, which utilizes data from the 2015 and 2016 waves of the Labor Force Survey in Vietnam. By employing the propensity score matching method followed by the difference-in-differences with matching method for analysis, this study provides robust evidence on the effectiveness of vocational training programs. This study is the first to use nationally representative data to evaluate the role of vocational training in improving the wages and employment prospects of rural workers in Vietnam. The findings indicate that vocational training significantly boosts workers’ wages by approximately 1,197,115 to 2,109,503 VND per month. Additionally, individuals with vocational training have a 0.39% to 2.2% higher likelihood of securing formal employment than those without such training. These results underscore the crucial role that vocational training plays in helping rural workers secure jobs and increase their incomes. These findings, based on nationally representative data, are valuable for policymakers in countries considering similar labor policies, particularly for vulnerable groups such as rural and agricultural workers.

 

Keywords: vocational training; labor market; rural areas; propensity score matching; difference-in-differences with matching

 

DOI：10.62321/issn.1000-1298.2024.06.01



 

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