Brian Jeffrey
In response to the challenges posed by population aging, particularly in developing countries like Vietnam, there is a need for flexible strategies in population and development to prepare for an aging society, with only 14 years remaining for Vietnam to make necessary adjustments.
Vietnam is experiencing one of the fastest rates of population aging globally. In 2019, individuals aged 60 and above constituted 11.9% of the total population, a figure projected to exceed 25% by 2050. The country is set to enter the “aged population” phase by 2038, transitioning from an “aging” to an “aged” society.
Impending Labor Shortages
Statistics indicate that in 2023, Vietnam’s population was approximately 100.3 million, with over 16 million elderly individuals. By 2038, Vietnam is expected to transition to an “aged population,” with more than 21 million elderly people, comprising nearly 20% of the total population. This transition from an aging to aged population will occur in just over 20 years, a significantly shorter period compared to developed nations.
The average life expectancy in Vietnam has been on the rise, reaching 73.2 in 2014, 74.5 in 2019, forecasted to reach 78 in 2030 and 80.4 in 2050. The aging index in Vietnam rose from 35.5 in 2009 to 53.1 in 2021.
While there was a high fertility rate in the 1970s – 1980s, with Vietnamese women having more children than the replacement level, this trend has since declined. There is a need for proper communication and awareness efforts to address the current mindset where marriage and childbirth are considered inconvenient by many Vietnamese youth.
Experts emphasize that declining birth rates, along with a growing aging population, pose challenges like labor shortages, especially in industries and services, impacting productivity and economic growth negatively.
Nguyen Thanh Binh, Chairman of the Vietnam Association of the Elderly, highlights the increasing participation of elderly individuals in the workforce. Over the past two decades, the percentage of elderly women and men engaged in work has seen a notable rise. The healthcare and social security systems face challenges due to the aging population, necessitating appropriate policies and infrastructure enhancement.
Need for Effective Policies
Recognizing the trend of population aging, the Party and the State have been focusing on creating policies, particularly in social safety nets, to address the situation effectively. For instance, Circular No. 96/2018/TT-BTC allows older individuals to access preferential loans to enhance their livelihoods and living standards.
Currently, about 3.1 million elderly people receive monthly pensions and social insurance allowances in Vietnam. The increasing number of retirees and longer pension periods are challenging the social security system, requiring a sustainable and efficient pension system development, a challenge faced by developed and developing countries alike.
Assoc. Prof. Dr. Ta Minh Tuan from the Vietnam Academy of Social Sciences views population aging not just as a risk but also an opportunity for sustainable development through the active engagement of older individuals. Encouraging childbirth, promoting women’s workforce participation, investing in education, training, and technology adoption are some recommendations to balance workforce challenges.
Pham Vu Hoang, Deputy Director of the Population Department under the Ministry of Health, emphasizes that population aging presents opportunities in various sectors like insurance, banking, and technology innovation, amid labor shortages. Vietnam must proactively address this challenge, drawing on global experiences to create tailored policies, ensuring older individuals’ self-reliance, independence, and successful aging.
By implementing flexible policies and empowering older individuals to actively participate in the workforce and society, Vietnam can navigate the challenges of an aging society and prepare effectively.
