An Overview of Labor Characteristics in HCMC

Key takeaways

• Ho Chi Minh City has the country’s largest workforce with 4.93 million people; it’s young and modern but surprisingly lacks enough high-quality workers.
• The job market has major divides: 70% of jobs are in services and 28% are in industry, but a third of the workforce is in the informal sector with limited skills.
• Companies face very high employee turnover (18-50% a year) and a major gap between the skills people have and the skills companies need.
• To succeed, companies need to invest in training their own staff and work with schools to close the skills gap.

Ho Chi Minh City’s workforce is complex. It’s very large, and its workers are more skilled than the national average, especially in service and industrial jobs. With a young labor pool, steady growth, and modern industries, the city is a great place for any business. However, this fast-paced environment creates challenges like high employee turnover, a mismatch in job skills, and intense competition for talent. For CEOs and leaders, understanding these points is a must for building a long-term hiring plan.

1. An abundant, young, and continuously growing workforce

The most notable thing about Ho Chi Minh City’s labor force is its huge size and young age. By 2025, the city is expected to have nearly 4.93 million workers, making up 9-10% of the nation’s entire labor force. This shows the city is an economic leader and a magnet for talent from across the country.

The city’s biggest advantage is its large number of working-age people. Workers aged 15 and over make up 51.2% of the population, with most being between 20 and 35 years old. A steady stream of young, educated migrants looking for career opportunities keeps the market dynamic and fresh.

The main challenge, however, is the mixed quality of the workforce. While there are highly skilled graduates from top universities, many migrant workers are unskilled. Compared to Hanoi, HCMC is larger but struggles more with having a consistent level of quality across its workforce.

2. A modern labor structure focused on services and industry

The city’s job market has clearly shifted toward a modern economy, focusing on two main areas:

1. Commerce and services (70.32% of all jobs): This is the main sector, with about 3.36 million workers. The growth of e-commerce and the digital economy has created high demand for professional roles. The top service industries for hiring are:

• Wholesale and retail: 20.77%
• Information and communications: 8.36%
• Real estate: 8.17%

2. Industry and construction (28.39% of all jobs): This is still a key sector with 1.36 million workers. Four key industries are in high demand for new talent (making up 18.6% of total need):

• Mechanics
• Pharmachemistry
• Food processing
• Electronics and IT

These industries are rapidly transitioning towards an automated manufacturing workforce model, requiring workers with advanced technical skills and the ability to operate intelligent systems.

3. Labor quality is improving but deeply polarized

While the overall quality of workers has gotten better, there are still major divides in the market.

The rate of trained labor is high but does not match demand

One of the biggest issues in HCMC is the major gap between the skills people have and the skills companies are looking for. In 2025, companies need 88.11% of new hires to have some form of training. Here’s the breakdown of what they need:

• University level or higher: 18.76%
• College level: 14.6%
• Intermediate level: 20.14%
• Primary level: 34.61%
• Unskilled: only 11.89%

The problem is that while workers with university degrees are often oversupplied, most companies actually need technical workers from primary, intermediate, or college levels. This leads to a “surplus of masters, shortage of workers” problem: high unemployment for university graduates and a serious lack of workers with hands-on skills.

Skills polarization between the formal and informal sectors

About a third of the city’s workers are in the informal sector (like street vendors, ride-hailing drivers, and freelancers). While they are a big part of the economy, they have few chances for formal training, creating a two-tiered workforce with very different skill levels and opportunities.

A degree doesn’t guarantee a job

Having a degree is no longer a sure path to employment. Among all unemployed people, 20-30% have professional training or a degree. In the first five months of 2025, out of 45,620 people getting unemployment benefits, 9,297 (or 20.02%) had a university degree or higher. This is because many school programs focus too much on theory and not enough on the practical skills needed for a job. Schools are also slow to update their courses to match the fast-changing needs of modern businesses.

4. A market of opportunities, yet always in need of top talent

Even with so many people available to work, HCMC faces a serious shortage of high-quality talent in key areas. For 2025, the city will need 310,000 to 330,000 new workers, most of them in highly skilled roles.

The fields most in need of talent include:

• Information Technology
• Finance and Banking
• Logistics and Supply Chain Management
• E-commerce
• Modern Management Services

HCMC is a top IT hub in Southeast Asia and home to 55% of all engineers in Vietnam. But this fast growth has created a big gap between the supply of skilled workers and the demand for them. The biggest challenge is that schools aren’t keeping up with the speed of the market. Many graduates have good knowledge but lack practical skills and teamwork experience. To fix this, many companies now use professional recruiting services (RPO) to find the best people for the job.

5. The most dynamic and flexible labor market

The energy of HCMC’s labor market is shown by how often people change jobs, which creates both opportunities and challenges, and reflects the decisive factors of the labor market in the country’s largest economic center. 

• High employee turnover: The rate of workers leaving their jobs is 18-20% per year, which is among the highest in Vietnam. In fields like textiles, it can be as high as 40-50%.
• A push for better benefits: This high turnover pushes companies to offer better pay, benefits, and work environments to keep their employees.
• The rise of the young workforce: Workers under 35 often switch jobs to find better growth opportunities. They care about more than just salary; they want meaningful work and a good company culture, reflecting a shift in the modern workforce mindset.
• Steady job growth: The market continues to grow, with the workforce increasing by 2.1% per year and adding over 141,000 new jobs annually since 2021.

An overview of labor characteristics in HCMC shows a market in a critical transition phase, embodying both great opportunities and significant challenges. Correctly grasping these characteristics will determine the success of a company’s HR strategy and its competitive edge in the future. Businesses must act now: invest heavily in internal training, build a strong talent ecosystem to retain top performers, and proactively collaborate with educational institutions to close the skills gap.