INTRODUCTION
Overview of the research
By 2050, over three-quarters of countries will be experiencing population aging, with about 147 nations facing this challenge (ILO 2020) Population aging is characterized by a growing proportion of elderly individuals within the demographic structure This trend poses urgent global concerns as the workforce also ages, leading to an increase in older workers By 2030, the proportion of workers aged 55-64 is projected to rise significantly, with increases of 13.2% in emerging countries, 17.7% in developed countries, and 7.9% in developing countries (ILO 2020).
Vietnam officially entered an aging period in 2011, facing significant challenges As of 2019, the General Statistics Office (GSO) reported approximately 11.4 million older individuals, making up 12% of the population, including over 1.9 million aged 80 and above Notably, around 7.3 million elderly people, or 64%, reside in rural areas, while over 3.1 million, accounting for 27%, receive pension and social insurance benefits Projections indicate that by 2050, Vietnam will become a "super old" nation with over 22 million elderly, representing 21% of the total population Furthermore, the Ministry of Labour, Invalids and Social Affairs (MOLISA) highlights a trend of increased workforce participation among older workers, with 60% of those aged 60-69 and 30% of individuals aged 70-79 choosing to continue working post-retirement.
Problem statement
Vietnam is experiencing one of the fastest-growing aging populations in Asia, leading to significant challenges in formulating effective policies and programs for the elderly Approximately 63.6% of older individuals in Vietnam face hardships, as they live without pensions or social assistance, highlighting the urgent need for comprehensive support systems for this demographic.
In 2015, older individuals increasingly rely on their children's financial support due to various daily challenges However, declining birth rates and rural-urban migration have diminished this support, leading many seniors to seek additional work to secure their income.
Social protection programs for the elderly in Vietnam have limited coverage, primarily benefiting well-off households and those in the formal sector who can contribute to pension schemes, while leaving the middle-income group, including older persons and informal sector workers, underserved Over 60% of older workers lack access to social insurance and retirement plans, resulting in an unstable income and no guaranteed minimum income regardless of their employment status Addressing old-age income security is crucial due to its significant impact on inequality and poverty.
As Vietnam faces a rapidly aging population, establishing a robust social protection system is crucial for safeguarding the well-being of older adults This comprehensive approach aims to address and mitigate challenges that negatively impact the lives of senior citizens, ensuring their dignity and quality of life in the face of adversity.
This research focuses on employment factors to gain insights into the working status of older individuals in Vietnam It aims to identify the primary sectors in which they are engaged and examine their labor contract status.
Research objectives
This thesis aims to provide a comprehensive overview of older workers in Vietnam, highlighting key issues and characteristics related to their employment and social protection Additionally, it will analyze the working status of older individuals to discuss policy implications that address social protection challenges faced by this demographic in Vietnam.
The specific objectives are research questions as follows:
How is the current situation of the employment and work sector among older people in Vietnam?
What are the problems of employment and social protection system among older workers?
What should the government of Vietnam address the social protection policy issues to protect the elderly in all work sectors?
The research structure
This chapter offers a comprehensive overview of the aging population and labor force trends, highlighting the challenges related to the employment of older individuals and the necessity for social protection policies Additionally, it outlines the research objectives of the thesis.
This chapter reviews global and Vietnamese studies on older employment, highlighting data collection methods and the social protection policies for elderly workers discussed in these papers.
This chapter will make a description of data collection Then, describe the methodology that will be used in this thesis as well as explain the variables in more detail
This chapter will analyze the descriptive statistics presented earlier, exploring the relationship between various variables and the working rate of older individuals Additionally, it will examine the factors that may pose risks to elderly workers and engage in a discussion of the key findings.
Chapter 5: Policy implications and conclusions
This chapter presents policy recommendations and key conclusions aimed at improving social protection for older workers, ensuring their work conditions are safer and more favorable based on the findings from chapter 4.
LITERATURE REVIEW
Studies about the Vietnamese older persons
Giang and Pfau (2010) examined the workforce participation of Vietnamese elderly, highlighting gender differences and identifying three employment sectors: non-agricultural work, agricultural work, and salaried positions Utilizing data from the VHLSS 2006 and employing logit models for males, females, and the elderly as a whole, their findings revealed that urban senior citizens, those in households with more working-age individuals, and those with higher incomes and social security benefits are less likely to participate in the workforce compared to other elderly groups.
In Vietnam, the pension scheme coverage remains weak, prompting Ha Trong Nguyen et al (2012) to investigate how monetary transfers from non-coresiding children affect the labor supply of their elderly parents Utilizing data from the 1997/98 Vietnam Living Standard Survey and a theoretical framework by Wolff (2006), the study employed a two-equation econometric model Findings revealed a strong correlation between monetary transfers and the needs of senior parents, with an annual transfer of approximately USD 83 (one million VND) reducing the work supply of elderly mothers by half an hour per week However, these transfers did not significantly impact the labor supply of older fathers, indicating that monetary support does not fully replace the labor contribution of parents.
Vietnam's labor force is significantly impacted by the informal sector, as highlighted by Huong, Nguyen Thi Lan et al (2013), who conducted a thorough review of existing literature and data The informal work sector poses challenges to social protection and socio-economic development in Vietnam, a rapidly growing economy in Asia where social insurance coverage remains low Currently, only one in five employees is enrolled in the public social insurance scheme, leaving many vulnerable groups within the labor force unprotected.
6 have less coverage like labour in informal work Expanding the coverage of social insurance is a key policy area to protect the benefit of labour force in any work area
Nguyen Nhu Thu Hoai (2014) with the research of employment behavior of older persons in rural Vietnam aims to identify determinant factors of employment decision
The probit regression analysis using data from the 2011 Vietnam National Aging Survey revealed that key social factors, including age, health status, marital status, and retirement allowances, significantly influence the work decisions of rural older adults In contrast, educational level and ethnicity showed no significant effects The findings underscore the importance of a robust healthcare and social welfare system to support older individuals with limited work capacity, as well as the need for lifelong education to equip the elderly with specific skills to thrive in a competitive labor market.
A study conducted by Thi Mai Huong Doan and Quynh An Ngo (2020) highlights the importance of flexibility and security policies for older workers in Vietnam, based on a survey of 39 companies and 428 older employees across Hanoi, Thai Binh, and Ninh Binh The research identifies business arrangements as the most influential factor affecting job and employment security for older workers Notably, sectors such as transport and telecommunications prioritize flexible recruitment strategies, whereas education and healthcare still rely on traditional approaches As Vietnam faces an aging population and potential labor shortages, understanding the factors that promote longer working careers for the elderly is crucial for enhancing their employment opportunities.
Studies about older persons in other countries
Margaret Maurer-Fazio, James W Hughes, and Dandan Zhang (2005) investigated the impact of China's economic reforms on labor market trends, focusing on shifts in male and female labor force participation and the distribution of occupations among genders during the reform era Their research highlights the significant changes in employment patterns and opportunities for both men and women in the context of China's evolving economy.
The article examines labor force participation trends among the elderly in China, revealing that rural elderly individuals are increasingly participating in the workforce, while their urban counterparts show a decline It highlights the feminization of agriculture and utilizes data from the Chinese population censuses of 1982, 1990, and 2000, employing a probit model with multivariate analysis to assess the impact of factors such as age cohort, marital status, sex, and rural/urban location on labor market behavior The findings indicate that women generally participate in the workforce less than men, with urban women more likely to be employed than their rural counterparts Additionally, single young individuals in urban areas tend to engage less in the labor force compared to those in rural settings, primarily due to educational commitments.
Gwee Sai Ling and Jacqueline Liza Fernandez (2010) investigated the influence of socio-demographic and socio-economic factors on the labour force participation (LFP) of senior citizens in Penang, Malaysia Their study analyzed data from 328 elderly individuals, focusing on variables such as age, gender, marital status, number of children, race, education level, health status, sector of employment, individual employment status, and the LFP of spouses The findings highlight the significant role these factors play in shaping the welfare and employment opportunities for older persons in the region.
A study conducted on 55 participants in various races in Penang utilized a logit model to assess the likelihood of elderly individuals engaging in the workforce The findings revealed that factors such as gender, high monthly expenses, previous employment status, and the labor force participation of spouses positively influence labor force participation (LFP) Conversely, while education and health were linked to LFP, they were not statistically significant Additionally, age, spouse's income, financial security, and low monthly expenses were found to have a significant negative impact on the LFP of the elderly.
In his 2013 paper, Lok P Sharma Bhattarai explores the importance of social protection planning for older adults, arguing that it should focus on social protection rather than traditional social welfare He emphasizes that adult education serves as a viable alternative to enhance the well-being of the elderly, offering a sustainable policy solution to alleviate the financial strain of old-age pensions.
Burholt, Maruthakutti, and Maddock (2020) explored the impact of culture and social protection on older individuals in India through a cultural political economy perspective, utilizing framework and higher-level interpretative analyses of qualitative data from in-depth interviews with 30 care-home residents in Tamil Nadu Their findings revealed a disconnect between the value orientations of social protection policies and prevailing cultural practices, highlighting that these policies often reinforce culturally constructed inequalities instead of effectively safeguarding against livelihood shocks.
DATA AND METHODOLOGY
Data
This study analyzes data from the 2018 Vietnam Labour Force Survey to examine the employment status of senior citizens in Vietnam It highlights the challenges faced by vulnerable older workers as they engage in the workforce.
This survey was conducted on 824,143 people from 0 to 103 years old who living in
Vietnam is home to 63 provinces, housing 116,781 elderly individuals aged 60 and above, with 63.89% residing in rural areas and 36.11% in urban settings This demographic distribution highlights the Labor Force Survey (LFS) as a valuable tool for understanding the employment landscape in Vietnam, encompassing a diverse range of workers from both urban and rural environments, including young and older employees.
Aiming to identify the factors associated with the working participation decision of Vietnam's older persons, we choose variables in LFS as follow:
Variables representing demographic characteristics: Age, gender, marital status, household head
Variables representing socio-economic characteristics: Highest education level, professional skill, job position, work experience, work sector, labor contract, social insurance
Variables representing household characteristics: Location.
Methodology
In this section, we clarify the research purpose outlined in Chapter 1 by employing descriptive statistics to provide a statistical overview of variables that characterize labor force participants The analysis will be conducted using STATA 14 in conjunction with the Labor Force Survey (LFS).
2018 data, we can get an overview of employment status among the elderly in Vietnam
We have description of variables as follows:
The article emphasizes the importance of labor force participation among senior citizens, highlighting key covariates that influence their decision to engage in the workforce It will explore the probability of participation by employing a binary variable system, where elderly individuals are categorized as either working (denoted by 1) or not working (denoted by 0).
The study analyzes social insurance participation among older individuals to understand their safety net post-retirement By using binary variables, we categorize seniors as either having social insurance (coded as 1) or lacking it (coded as 0) Social insurance encompasses both voluntary and mandatory programs It is anticipated that senior citizens receiving social security benefits are likely to engage in less work compared to those without such benefits.
The age variable is categorized into three groups: 60-69 years (young old), 70-79 years (middle old), and 80 years and older (oldest old) Consistent with findings from previous studies, it is anticipated that individuals in the oldest old group are less likely to be employed compared to those in the young old group.
In analyzing workforce participation, we utilize a dummy variable for gender to distinguish between male and female workers Our findings suggest that older men are more likely to participate in the workforce compared to older women.
Marital status categorizes the elderly into three distinct groups: married, widowed, and others (including single, separated, and divorced) Typically, married older adults may exhibit a greater tendency to engage in work due to familial responsibilities compared to their counterparts in other groups.
The role of the head of household significantly influences the position of elderly individuals within the family structure, as it encompasses relationships with spouses, children, and parents It is anticipated that elderly heads of households are more likely to engage in work compared to those in other familial roles, due to their critical responsibility for managing the family's finances and assets.
Variables representing socio-economic characteristics
Older adults' education levels are categorized into four groups: no schooling or incomplete primary, primary to secondary, professional middle-to-college, and university or higher Those with lower education often experience reduced income and poorer living conditions, which correlates with a decreased likelihood of employment compared to their more educated counterparts.
Older workers' professional skills can be categorized into four distinct groups based on their education levels: those with no skills, those with primary to middle education, those with college education, and those with university degrees or higher.
The job position is a key employment variable in research, categorizing senior citizen workers into four groups: self-employed, family workers, wage earners, and others, such as cooperative members and owners Self-employed individuals and family workers are classified as vulnerable employment according to the International Labour Organization (ILO), characterized by low earnings, low productivity, poor working conditions, and a lack of fundamental workers' rights.
Older workers can be categorized based on their work experience into two groups: those with less than five years and those with five years or more Typically, elderly employees with limited experience encounter more challenges compared to their more seasoned counterparts, particularly regarding salary negotiations and work conditions.
To analyze the work sector of older workers, we categorize them into three distinct groups: those engaged in their own enterprises, such as agro-forestry and fisheries households; individuals in the cooperative sector; and those employed in the public and non-public sectors.
In the formal sector, a labor contract is essential, yet obtaining one can be challenging for those in the informal sector Older workers can be categorized into four groups based on their employment agreements: i) no-term contracts, ii) fixed-term contracts (ranging from 3 months to 3 years), iii) verbal agreements, and iv) workers without any contract.
Location: The location of the elderly‟s residence is divided into two areas: urban and rural Like the result of several previous papers, we expect that
12 older people in rural areas have a labour participation rate higher than urban senior citizens
FINDING AND DISCUSSION
Descriptive statistic of older persons and employment in Vietnam
According to the 2018 Labour Force Survey (LFS), key characteristics of senior citizens in Vietnam reveal a significant correlation with their labor status Notably, the workforce participation rate among older individuals stands at just 35.61%, indicating that a substantial 64.39% of seniors are not engaged in work after reaching the age of 60.
Social insurance participation is a critical social protection concern, particularly for older workers, who represent a vulnerable demographic Alarmingly, a staggering 99.29% of older individuals are not enrolled in social insurance schemes, highlighting the urgent need for targeted solutions to address this issue.
Our analysis reveals that individuals aged 60-69 represent the largest segment of the older population, comprising 55.82% of the total In contrast, those in the middle age bracket of 70-79 account for approximately 25% of older adults, while the oldest age group contributes to the remaining percentage.
In Vietnam, the elderly population aged 80 and above has the lowest representation at 18.56% As the aging demographic continues to grow, there will be a significant increase in the number of middle-aged and older individuals, leading to a shift in the overall percentage of the elderly population.
The demographic data reveals that among the elderly population, males account for 41.77% while females represent 58.83% This disparity in gender distribution is largely attributed to the longer life expectancy of women Additionally, a significant portion of the elderly, 63.89%, resides in rural areas, reflecting the agricultural economy of the country, while one-third live in urban settings.
Table 4.1 Descriptive Statistics for the variables used
Married Widowed Others (single/ separated/ divorced)
Head Spouse Child Parents Others
No schooling or incomplete primary Primary to secondary
Professional middle-to-college University or higher
No Primary to the middle College
Self-employee Family worker Wage earner Others (cooperative members/ owner)
Less than 5 years 5y and over
Own (agro-forestry-fisheries household/ business household) Cooperation sector Public sector Non-public sector
No-term Others (3 months/ 1 year/ 3 years contract) Verbal agreement
31.16 63.89 Source: Own calculations using LFS 2018
In the senior citizen demographic, married individuals represent the largest segment, comprising 64.32% of the older population In contrast, widowed seniors make up 31.95%, while those who are single, separated, or divorced account for a mere 3.71%.
The analysis of the elderly's position within their families reveals that the majority, 58.86%, are heads of household, while spouses account for 26.95% A small percentage consists of children at 0.4%, parents at 11.86%, and others at 1.93%.
Historically, a significant portion of the elderly population has faced educational challenges, with 36.16% lacking formal schooling or having only incomplete primary education.
Only 53.31% of the elderly population has completed primary to secondary education, with a mere 6.02% achieving professional middle-to-college education and only 4.51% attaining university or higher degrees Alarmingly, around 86.69% of older individuals reported lacking professional skills, highlighting the challenges faced by those with predominantly low to middle education levels.
The analysis reveals that vulnerable job positions are predominantly held by self-employed individuals (70.62%) and family workers (15.92%), while wage earners and other categories, such as cooperative members and owners, represent only 12.01% and 1.45%, respectively, of the total older workforce.
A significant majority of elderly workers, accounting for 88.39%, possess over five years of work experience, while only 11.61% have less than five years Despite the small percentage of less experienced older employees, it is crucial not to overlook them, as they may face challenges when transitioning to new fields that differ from their previous roles.
A significant majority of elderly workers, accounting for 94.42%, are engaged in self-employment within agro-forestry-fishery households or business households In contrast, only 5.37% of older individuals work in the public sector, while a mere 0.21% are employed in cooperative sectors Notably, there is no representation of elderly workers in the non-public sector.
Labour contract status plays a crucial role in social protection issues for elderly employees A significant portion, 54.89%, report having only a verbal agreement upon employment, while 10% indicate they do not have any labor contract at all Additionally, 11.39% of older workers are engaged without a fixed-term contract, and about 23.7% fall into various short-term contract categories, including 3 months, 1 year, and 3 years.
Labour force participation of older persons
Table 4.2 presents the workforce participation rate of Vietnamese older persons with regard to their characteristics
As individuals age, their likelihood of participating in the labor force decreases Data shows that the youngest segment of older adults, aged 60-69, has the highest labor force participation rate at 55.82% In contrast, the participation rates drop significantly for those aged 70-79 and 80 and above, with rates of 25.62% and 18.56%, respectively.
Table 4.2 Workforce participation rate of older persons by characteristics
No schooling or incomplete primary 28.04
Source: Own calculations using LFS 2018
The low workforce participation rate among older adults, particularly those aged 70 and above, is largely attributed to health issues and declining physical condition Many elderly individuals may lack the motivation to continue working due to poor health compared to their younger counterparts To boost labor market participation among older workers, it is essential to enhance the healthcare system, ensuring that seniors can achieve optimal health when seeking re-employment.
Elderly men have a 12.4% higher probability of participating in the labor force compared to older women, with male and female older workers representing 41.77% and 58.23% of the total elderly workforce, respectively Research indicates that older mothers are more likely to rely on their children's financial support than elderly fathers (Ha Trong Nguyen, 2012).
In rural areas, the working participation rate of senior citizens is significantly higher than in urban settings, with 42.96% compared to 22.61% This increased participation is largely due to the nature of work in rural communities, where elderly individuals often engage in family-oriented tasks such as farming and fishing to support their households, albeit without receiving formal salaries However, these family workers face vulnerabilities, as their roles are typically associated with low pay, reduced productivity, and challenging working conditions, as highlighted by the International Labour Organization (ILO).
Figure 4.1 Working rate by age, gender and location
Source: Own calculations using LFS 2018
Marital status significantly influences the employment rates of older adults, as illustrated in figure 4.2 Married individuals aged 65 and older exhibit a higher work rate of 43.69% compared to their non-married counterparts, which include singles, divorced, separated, and widowed individuals This increased employment among married seniors can be attributed to their shared responsibilities in caring for their families and managing financial obligations with their spouses In contrast, widows often face poorer health outcomes, highlighting the challenges faced by non-married elderly individuals.
(2013) mentioned that "widowhood seems to have mental, social, behavioral and biological consequences, consistent with a stress‐inducing process" so that their ability to work is low (at 19.25%)
Older individuals who serve as heads of households are more likely to be employed, with a work rate of 38.1%, compared to 32.12% for those in other roles This increased likelihood of employment can be attributed to the financial responsibilities that household heads often bear, making them more inclined to seek work than others in different positions.
Figure 4.2 Working rate by marital, house head, education level, and professional skill
Source: Own calculations using LFS 2018
Highest education level: About nearly half of the elderly (42.79%) who have the highest education level at primary to secondary taking part in the labor force at aged
60 and above Table 4.2 also shows that older people with no schooling or incomplete primary level had a participation rate of 28.04% At the same proportion, the working
No schooling or incomplete primary
Primary to secondary Professional middle-to-college
Ma ri ta l st at us
H igh es t edu ca ti o n leve l Pro fes si onal ski ll s
The participation rate of older individuals who have completed education at the professional middle-to-college level is 29.42%, surpassing the labor force participation rate of those with a university education or higher, which stands at 19.45% This indicates that older adults with lower educational attainment often experience reduced income and living conditions, leading them to engage in work more frequently than their more educated counterparts Notably, only 20% of older individuals with a university degree or higher are currently employed.
The labor participation rate among the elderly shows a relatively equal distribution across different professional levels Unskilled workers lead with a participation rate of 36.71%, followed closely by those with primary to middle professional skills at 34.09% In contrast, the lowest participation rates are observed in the elderly with higher qualifications, such as those with college or university degrees, both at 19.45% Interestingly, older individuals with similar educational backgrounds and professional skills (university level and above) exhibit the same labor force participation rate of 19.45%.
With every 100 well-educated and skilled elderly individuals, there are approximately 20 people available for work To leverage the experience and expertise of this valuable workforce, the government must implement strategies that enhance their contributions, ultimately supporting the nation's social security objectives This topic will be explored in greater detail in the following chapter.
Characteristics of older person‟s work by the number of hours working
Using STATA application version 14, the estimation results of labor force participation (LFP) based on the number of hours worked in the past seven days are presented in Table 4.3 The analysis categorizes the variables into three distinct groups: i) 1-20 hours, ii) 20-39 hours, and iii) 40 hours or more.
Table 4.3 Number of hours working in the past 7 days
Source: Own calculations using LFS 2018
According to data from the LFS and our calculations, 46.38% of elderly workers are employed for more than 40 hours per week In contrast, the proportion of those working between 20 to 39 hours per week is significantly lower at 35.6% Furthermore, the percentage drops even further for those working 1 to 20 hours per week, reaching the lowest point of 18.01%.
According to the GSO, the average number of working hours of the whole country in
2019 is 45.3 hours/week/worker There are a surprisingly large number of older people working with the same amount of time as the average working hours of the country's workers
Figure 4.3 Number of hours working in the past 7 days
Source: Own calculations using LFS 2018
By age, figure 4.3 shows that the youngest older people (age 60-69) tend to work in longest of hours of work with the highest rate (51.11% older people work
>@hr/week) The remaining percentage is 34.63% of the group "20 39 hou rs" and 15.25% of group "1-20 hours"
In contrast, only 18.19% of the oldest senior citizens work more than 40 hours per week, while 43.26% work just 1-2 hours weekly This trend is understandable, as younger elderly individuals generally have better health status, allowing them to engage more in the workforce.
A ge G ende r Loca ti on Tot al
23 to work longer hours working than the older-age workers
In the context of gender dynamics in the workforce, older males typically work longer hours than their female counterparts, with 50.23% of elderly men working more than 40 hours per week, compared to 42.29% of elderly women This trend is particularly pronounced in Asian cultures, including Vietnam, where men are often seen as the primary breadwinners responsible for supporting their families Consequently, it is understandable that elderly males tend to have longer working hours than elderly females.
Both urban and rural older adults exhibit a similar trend in work hours, with 59.6% of urban seniors and 42.6% of rural seniors working over 40 hours per week However, the proportion of elderly workers in rural areas working more than 40 hours is notably lower than in urban settings This disparity may be attributed to the health status of rural seniors, which aligns with findings from Giang et al (2016) that indicate poor health negatively affects the employment decisions of older individuals in rural areas.
Senior citizens in good health, such as younger older adults, male seniors, or those living in favorable conditions like urban workers, are more likely to work longer hours However, extended work hours can be detrimental to the health of elderly individuals with weaker health Therefore, it is essential for businesses and employers of older workers to prioritize and manage working hours to support the well-being of elderly employees.
Characteristics of older person‟s work by job position
The employment status of older workers is closely linked to their unique characteristics, revealing which sectors they are most involved in By analyzing these employment ratios, we can better understand the specific challenges faced by elderly workers in their respective job positions.
Tables 4.4 and Figure 4.4 illustrate the distribution of job positions among various characteristics of the elderly population Notably, self-employment accounts for the highest percentage at 70.62% A significant portion of self-employed elderly workers are engaged in vulnerable job roles, according to the International Labour Organization (ILO).
Figure 4.4 LFP rate of older person by job position
Source: Own calculations using LFS 2018 Table 4.4 Characteristics older person‟s work by job position
No schooling or incomplete primary
Self-employee Family worker Wage earner Other
Source: Own calculations using LFS 2018
In detail, considering the relationship between the job characteristics of the elderly in terms of job position, we can calculate some key points as follows:
In our analysis of age demographics, we emphasize self-employed and family worker groups, as these occupations are classified as vulnerable by the International Labour Organization (ILO) Elderly individuals engaged in these job sectors often face considerable challenges Notably, self-employment constitutes the largest portion of the workforce among older individuals across all age brackets.
The self-employment rates among older workers show a notable trend: 69.51% for those aged 60-69, 75.08% for those aged 70-79, and 77.65% for those aged 80 and above Additionally, while family workers represent a smaller proportion compared to self-employed individuals, their rates are still significant, standing at 15.6% for the youngest older workers, 17.18% for middle-aged older workers, and 17.86% for the oldest group.
There is a notable disparity in the percentage of elderly family workers based on gender, with 9.90% of elderly men engaged in family work compared to 21.99% of elderly women This difference can be attributed to the traditional role of women, who frequently take on unpaid family responsibilities such as caregiving for children, the elderly, and individuals with disabilities, as well as performing household chores.
Women consistently make up a larger share of family workers compared to men, regardless of age According to UNDP (2015), women engage in three times more unpaid work than their male counterparts Therefore, it is essential to implement mechanisms that protect the rights of female workers in the labor force.
Figure 4.5 Characteristics older person‟s work by job position
Source: Own calculations using LFS 2018
No schooling or incomplete primary
Primary to secondary Professional middle-to-college
A ge G ende r Loca ti on H igh es t edu ca ti o n l evel Pro fes si onal ski ll s
OtherWage earnerFamily workerSelf-employee
Workers with low or no education levels tend to prefer self-employment, with a striking 71.91% of older individuals who left school before completing primary education choosing this path Similarly, those with only primary to secondary education have a self-employment rate of 71.81% In contrast, the rate of self-employment drops to 63.37% among older workers with professional middle to college education, indicating a significant decline as educational attainment increases.
Higher education offers significant advantages for qualified elderly workers, providing them with greater opportunities in the labor market In fact, individuals with university degrees or higher represent 39.38% of the total wage-earning workforce, highlighting the value of advanced education in enhancing employment options for this demographic.
A noticeable decline in the self-employment rate among senior citizens is observed as professional skill levels increase Specifically, older workers with no skills exhibit a high self-employment rate of 72.53% This rate decreases progressively with higher skill levels: 59.75% for those with primary-to-middle employment skills, 54.7% for college-level skills, and only 39.64% for individuals with university degrees or higher.
Older individuals with advanced vocational skills are less inclined to pursue self-employment Their extensive experience and high-level expertise enable them to secure better job opportunities that offer more stability and benefits, such as reliable income, social insurance, and formal labor contracts, in contrast to the risks associated with self-employment.
Characteristics of older person‟s work by labour contract
Labor contracts and social insurance are essential components of formal employment, providing crucial protection for workers These documents play a vital role in safeguarding employees against risks such as occupational accidents, job termination, and labor exploitation, highlighting their significance in ensuring workplace security and rights.
Part 4.5 and the next part 4.6 will concentrate on the status of the labor contract and social insurance among older workers in Vietnam Figure 4.6 illustrate the labour force participation rate of older person by labour contract into four groups: (i) No term, (ii) Other, (iii) Verbal agreement, and (iv) No contract
Figure 4.6 Labour force participation rate of older person by labour contract
Source: Own calculations using LFS 2018
The rate of verbal agreements for employment among older individuals varies by age, with the highest percentage found in the youngest group of seniors aged 60-69, where approximately 55.17% secure jobs through verbal agreements In the middle-aged senior category of 70-79 years, this rate is slightly lower at 53.33% Among the oldest elderly workers, the rate of verbal contracts drops to 41.99%.
Senior citizen employees, regardless of age, represent a significant portion of the labor force, highlighting their importance Additionally, data from Table 4.5 reveals a concerning no-contract rate among older workers, with approximately 10-14% of elderly employees across various age groups lacking formal contracts.
Table 4.5 Characteristics of older person‟s work by labour contract
No-term Other Verbal agreement
No-term Other Verbal agreement No contract
No schooling or incomplete primary
Source: Own calculations using LFS 2018
The absence of formal contracts or verbal agreements leaves older workers vulnerable to employment risks, as they lack essential protections Without a binding contract, these workers face significant challenges, particularly regarding pension and health insurance, which are crucial for their security in later years.
Among elderly female workers, approximately two-thirds are employed under verbal contracts, while 12.2% lack any contract altogether This means that roughly 80% of older female workers are engaged in unsafe working conditions, either through verbal agreements or without any formal contract.
Figure 4.7 Characteristics of older person‟s work by labour contract (1)
Source: Own calculations using LFS 2018
Figure 4.7 illustrates a significant disparity between rural and urban elderly workers regarding verbal agreements, with 64.50% in rural areas compared to just 39.68% in urban areas This trend aligns with the labor force participation (LFP) rate, which is also notably higher among the elderly in rural regions, being twice that of their urban counterparts, as depicted in Figure 4.1.
A ge G ende r Loca ti on
No contract Verbal agreement Other
Figure 4.8 Characteristics of older person‟s work by labour contract (2)
Source: Own calculations using LFS 2018
Figure 4.8 indicates that the verbal agreement factor shows minimal correlation with the education level and professional skills of older workers in Vietnam Notably, the groups with low education (no schooling and incomplete primary) and no vocational skills exhibit significantly high verbal agreement rates of 80.45% and 68.1%, respectively This highlights that the preference for qualified older workers remains a prevailing trend.
No schooling or incomplete primary
Primary to secondary Professional middle-to-college
H igh es t edu ca ti o n l evel Pro fes si onal ski ll s
No contract Verbal agreement Other
Approximately 95.34% of older individuals with university or higher education hold contracts, with 40.24% having no-term contracts and 45.10% possessing term contracts Notably, this contract ownership rate is consistent among older adults with professional qualifications at the university level or above.
Characteristics of older person‟s work by social insurance
Social protection remains a pressing concern in Vietnam, particularly the participation rate in social insurance Currently, only 50% of working-age employees benefit from social insurance, with 47% enrolled in compulsory programs and a mere 3% in voluntary schemes Additionally, health insurance coverage stands at an impressive 95%.
In this research, among older workers, we include both compulsory and voluntary insurance by one term, namely social insurance
According to the calculations from LFS 2018 presented in Table 4.6, only formal employment sectors, including wage earners and those with no-term labor contracts, exhibit a social insurance participation rate exceeding 10% Notably, elderly employees with no-term contracts have a remarkable participation rate of 79.16% in social insurance, indicating that they are typically high-quality workers who enjoy numerous workplace benefits.
Additionally, factors such as age, location, and job status—whether self-employed, family worker, or under verbal or no contract—contribute to the alarmingly low participation rate in social insurance.
Table 4.6 Characteristics of older person‟s work by social insurance
Variables Social insurance participation rate (%) Age
Source: Own calculations using LFS 2018
Figure 4.9 Characteristics of older person‟s work by social insurance
Source: Own calculations using LFS 2018
No-term Other Verbal agreement
Major findings
This thesis conducted statistically descriptive analyses of the current employment status among older people in Vietnam from 116,781 senior citizens respondents in LFS 2018
This research focuses on the employment challenges faced by the elderly in Vietnam, highlighting the social protection issues that older workers encounter According to the 2018 Labor Force Survey (LFS), the labor participation rate among the elderly stands at over one-third (35.61%) of the total elderly population, a figure that is expected to rise significantly due to the country's aging demographics.
Through descriptive statistical analysis, we explored several factors influencing the workforce participation rate of older individuals in Vietnam Our findings revealed several key issues that impact this demographic's employment engagement.
Research indicates that older individuals tend to have lower workforce participation rates as they age Notably, married older adults exhibit a significantly higher participation rate compared to their widowed, single, separated, or divorced peers Additionally, the labor force participation rate among older men is greater than that of older women, with figures of 40.82% for men and 30.44% for women.
In Vietnam, older individuals residing in rural areas exhibit a labor force participation rate nearly double that of their urban counterparts This trend is indicative of the country's agricultural economy, where a significant portion of the elderly population, approximately 63.89%, lives in rural settings, contributing to the high employment rates among them.
Approximately 95% of highly qualified older individuals are employed under contracts In contrast, senior citizens with lower education levels and fewer professional skills are more likely to remain in the workforce Those with higher education typically engage in formal employment and receive retirement pensions after the age of 60, making them less reliant on work for income security compared to their less-educated counterparts.
A significant number of older individuals are engaged in informal employment, with self-employment representing the highest labor force participation rate at 70.62%, followed by family workers at 15.59% These roles are considered vulnerable and require protection to ensure the well-being of older workers.
A staggering 99.29% of senior citizens are not enrolled in any social insurance scheme, indicating a significantly low participation rate among older workers Only those elderly individuals employed under a labor contract—whether for a fixed term or without one—are eligible for social insurance coverage.
Older workers in informal employment, such as self-employed and family workers, exhibit the highest labor force participation (LFP) rate; however, they have the lowest social insurance participation rate, which stands at just 0.04% This discrepancy is largely attributed to the prevalence of informal job positions among older individuals, making it challenging for them to secure formal contracts with employers.
Although undesirable, this study still has limitations such as follow:
The LFS 2018 employment survey lacks crucial data on household financial status and health, both of which significantly influence labor force participation rates among the elderly Incorporating these factors into the analysis of elderly employment status would provide a more comprehensive understanding of their working conditions.
POLICY IMPLICATIONS AND CONCLUSIONS
Policy implications
Understanding the employment status of older workers is crucial, as certain elderly cohorts may encounter specific risks when engaging in the labor force To address these challenges, we propose several policy recommendations aimed at supporting older individuals in the workforce.
To enhance the inclusion of informal elderly workers in the national retirement system, it is essential to implement policies that encourage their participation in social insurance Expanding the pension system will provide these workers with better access to vital social safety nets, ensuring they receive the support they need in their later years.
The government can boost participation in voluntary social insurance among informal older workers by subsidizing a portion of their social insurance payments Additionally, it is essential to establish a balanced framework that treats voluntary and compulsory social insurance equitably.
The participation rate of Vietnamese elderly individuals in social insurance is alarmingly low, primarily due to the prevalence of self-employment and family work among older employees These workers often experience irregular incomes and low wages, leading to reluctance in contributing to insurance payments Furthermore, the requirement of 20 years of social insurance contributions to qualify for a pension poses a significant challenge for informal older laborers, making it difficult for them to secure financial support in their retirement years.
Vietnam's pension schemes, like those in many Asian countries, face significant limitations as they primarily cover workers in the formal sector, including public employees and those in private enterprises A large portion of older workers are engaged in the informal sector, often as self-employed individuals or family workers To address this issue, it is essential to develop support programs that foster a favorable work environment for the elderly and implement social protection policies that extend coverage to all sectors of the workforce.
Currently, social protection policies are primarily focused on affluent groups through insurance mechanisms, while also addressing the needs of low-income and near-poor populations via government-funded social assistance programs.
The middle-class demographic appears to be overlooked, lacking access to social insurance and ineligible for social assistance This group is dynamic yet vulnerable, facing the risk of falling into poverty.
Second, enhancing to the workforce with a high qualified older workers
Promoting active aging for senior citizens involves setting clear goals that encourage older workers with valuable professional skills to remain engaged in the workforce post-retirement By fostering an environment that supports their continued employment, we can harness their expertise and experience, ultimately benefiting both the individuals and the economy.
Educational attainment plays a crucial role in supporting senior citizens; however, our research indicates that a significant number of older individuals with higher education remain underrepresented in the workforce It is essential to focus on enhancing the quality of elderly workers by encouraging those with advanced qualifications or extensive work experience to remain active, thus preventing the waste of valuable human resources during an era of an aging population.
Increase the workforce participation rate of elderly workers will be a significant contribution to improve the employment and labor issues in particular, wasting high- quality human resources
Third, implementing the livelihood policies to different groups of elderly people to encourage the elderly to taking part in the workforce as a special labour
The aging population presents both challenges and opportunities for Vietnam, necessitating increased investment in healthcare, retirement benefits, and social security By implementing supportive policies that enhance the livelihood of the elderly, Vietnam can foster an environment where older individuals continue to contribute meaningfully to society This proactive approach not only addresses social issues but also strengthens the economy's resilience to evolving social trends.
Creating livelihoods for the elderly serves two primary objectives: enhancing their quality of life through sustainable income, which aids in poverty alleviation, and fostering socio-economic development by leveraging this unique labor resource This initiative not only enriches the labor market but also supports the broader goals of social security within the country.
Fourth, limiting and reducing risks in employment for the elderly group in the all- sector
In Vietnam, informal employment refers to jobs within the informal sector, where workers are typically self-employed and do not have formal labor contracts These informal workers lack access to social insurance, health insurance, and do not receive a fixed salary.
The LFS 2018 report reveals that a significant number of elderly workers are engaged in informal employment, lacking social insurance coverage Nearly half of these workers are subject to extended working hours, with a notable concentration of no-contract positions among older female workers, those residing in rural areas, and individuals with limited education, including those with no formal schooling or incomplete primary education.
To effectively reduce risks for informal workers, labor policy must prioritize the promotion of formal employment opportunities for older individuals Ensuring that elderly workers receive official contracts and access to social insurance is essential for safeguarding their rights By providing these protections, we can help elderly workers mitigate the dangers associated with market fluctuations, labor accidents, and exploitation in the workplace.
Fifth, making favorable conditions for the vulnerable older workers to access job
The government must prioritize employment and social policies tailored for elderly women, who represent a larger demographic due to their longer life expectancy As a result, an increase in the number of female workers in this age group is anticipated.
Strengthen the health care networks for the elderly that the elderly in the countryside, the female elderly, or the ethnic minorities‟ senior citizens can favorably access work.
Concluding remarks
The effect of population aging is huge in developing economies like Vietnam This phenomenon poses social challenges and economic impacts to Vietnam on the decline
39 in productivity by the shortage in labor supply and lack of fulfilling welfare system
This thesis provides an analysis of the employment status of older workers in Vietnam, utilizing demographic, socio-economic, and household variables derived from the Labour Force Survey 2018.
Vietnam is experiencing a significant demographic shift towards an aging population, characterized by several key factors Many older workers face low and unstable incomes, particularly in rural areas where their numbers are substantial Additionally, there is a noticeable trend of increased workforce participation among elderly women Furthermore, older individuals with lower educational qualifications and professional skills are more likely to remain in the workforce, highlighting the unique challenges and characteristics of aging workers in the country.
Vietnam is experiencing a rapid increase in its elderly population, raising concerns about income security for older workers Establishing a robust social protection floor is crucial for ensuring financial stability for the working-age population and providing pensions for the elderly, in line with Sustainable Development Goal Target 1.3 To address these challenges, it is essential to develop support programs that foster a conducive work environment for older individuals and implement comprehensive social protection policies that extend coverage to all sectors, ensuring that those in the informal economy can work safely and securely.
Based on our findings regarding social policy issues for older people in Vietnam, we recommend measures to protect and support older workers, enhance their working conditions, and minimize risks associated with employment for the elderly.
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