The Hanoitimes - Everywhere in the world, the future of the workforce will rely on highly-skilled workers. The situation in Vietnam is no exception, said a PwC’s expert.
Companies, including those in Vietnam, should be proactive in upgrading the quality of their workforce for the digital era, while not neglecting the other fundamental obligations that an employer has in respect of its employees, according to regional experts from PwC.
A new survey of over 22,000 adults across 11 economies released by PwC finds that the speed of change brought by technology is pushing workers worldwide to adapt. The majority of workers (61%) are positive about the impact of technology on their day-to-day work, and 77% of people would learn new skills now or completely retrain to improve their future employability.
Overview of the discussion.
Yet the support they receive from employers is not up to par, according to experts from PwC South East Asia at the roundtable discussion with HR leaders of Vietnam-based firms held on September 9. Most businesses are failing to take the necessary actions to grow or add future-ready talents to their organizations, for example by using data analytics to make workforce decisions or creating a compelling work experience for employees.
Findings from PwC’s report titled “Preparing for tomorrow’s workforce, today” reinforce these statements. The 2018 report finds that although more than 70% of survey respondents in South East Asia think using data analytics in workforce decisions is important, only 34% actually do so.
Meanwhile, 68% of respondents in the region view mobility as important, but only 44% have effective mobility and collaboration programs in place to make the best use of talent across borders.
Nicole Wakefield, leader at PwC’s Southeast Asia Management Consulting.
“Everywhere in the world, the future of the workforce will rely on highly-skilled workers. The situation in Vietnam is no exception. Employees and employers should think less about jobs and roles, and more about the bundle of skills that they have and need in our digital world. It is this bundle of critical skills that will be the most important asset when setting up for success,” said Nicole Wakefield, leader at PwC’s Southeast Asia Management Consulting.
"Providing a culture of lifelong learning, upskilling and growth mindset will be a priority for companies and their workforce. Learning will no longer be an activity that is only done once or twice a year in a formal classroom setting. Rather it will become a regular part of someone’s daily/weekly working journey as they continue to adapt and evolve,” she said.
Spotlight on employment taxes
Upskilling and employee experience aside, employers should also pay due attention to the other core obligations that they have towards their workforce. The term “employment tax” takes center stage here. Employment tax can be understood as any obligation that an employer has in respect of its employees. Not only does it encompass paying employees on time, but it also includes fulfilling social security obligations and meeting regulatory requirements such as employment tax withholding, year-end reporting, as well as employee wellbeing, etc.
According to the Paying Taxes 2019 report by PwC and the World Bank Group, globally, tax authorities are collecting as much employment tax as profit tax (corporate tax). The changing legislation landscape in Vietnam reflects this global trend. For example, effective from December 01, 2018, social insurance contributions are payable by foreign individuals working in Vietnam under employment contracts with an indefinite term or a definite term of one year or more. With this change, employers must start making contributions for foreign employees at the relevant employer contribution rates.
Elsewhere in South East Asia, legislative and technological changes are also causing disruption. Other employment tax trends in the region include more aggressive and targeted tax audit activities using data analytics, focusing on payroll audits and employer obligations. Quicker access to information and collaboration amongst regulatory authorities are also on the rise.
“These trends and challenges warrant a greater focus on developing a comprehensive employment tax framework, focusing on acquiring the necessary tax expertise, tax engagement structure and risk management. This framework should include an employment tax strategy that is aligned to the wider tax and business strategy,” said Brittany Chong, Global Mobility Services Leader at PwC Vietnam.
“Forward looking HR leaders are well advised to take a holistic view of all the aspects of maintaining a productive workforce. Digital upskilling has been the buzzword recently and it should indeed be a focus. Yet that does not mean that companies can afford to neglect compliance obligations with regards to their employees,” Chong added.