4 impacts of digital transformation on the Hanoi labor market

Quỳnh Chi |

The application of digital technology is taking place in both the production and service sectors, creating fundamental changes in the way labor is organized and allocated in the capital.

According to the Hanoi Employment Service Center, digital transformation is not only a technology trend but has become a vital strategy for businesses in Hanoi.

The application of digital technology is taking place in both the production and service sectors, creating fundamental changes in the way labor is organized and allocated.

Differentiation by industry

In the manufacturing and manufacturing sector, the implementation of autonomous robots, smart production lines and IoT ( internet of Things) helps optimize processes, significantly reducing the need for simple labor. Many tasks such as transporting machinery, checking product quality or managing warehouses are gradually being replaced by sensor and AI systems.

Meanwhile, the financial and banking services sector witnessed a shift from traditional transaction positions to the fields of financial technology (fintech), customer data analysis, and cybersecurity. Education and health care are also strongly affected when teachers have to get used to online learning platforms, doctors need to use AI to support diagnosis and management of electronic medical records. These changes require workers not only to have professional expertise but also to equip themselves with additional digital skills to adapt.

Impact on labor productivity and governance models

Businesses that apply Big Data and AI can make decisions faster, reduce risks and improve productivity. However, this means that competition in the market will become fierce: conversion-oriented enterprises are at risk of being eliminated, leading to a decline in labor demand in some traditional industries.

Trung tam Dich vu viec lam Ha Noi nhan dinh viêc ap dung công nghê so dang dien ra o ca khu vuc san xuat va dich vu, tao ra su thay doi căn ban trong cach thuc to chuc va phân bo lao dông tren dia ban Thu do. Anh: Quynh Chi
The Hanoi Employment Service Center assessed that the application of digital technology is taking place in both the production and service sectors, creating fundamental changes in the way labor is organized and distributed in the capital. Photo: Quynh Chi

For workers, this process is "screening and khac phucing", those who adapt quickly will have the opportunity to work with high quality, while those who cannot keep up are easily discouraged or pushed to the informal sector.

Changes in human resource governance

When transforming digitally, businesses must not only invest in technology but also restructure the entire organizational model. Data-based human resource management tools (HR Tech) allow real-time performance monitoring and capacity assessment based on data rather than just management levels. This creates new pressure for workers, but at the same time opens up more transparent opportunities in assessment and promotion.

On the other hand, flexible working models (hybrid work, remote work) are being applied by many companies in Hanoi, helping employees have more flexible working conditions, but posing challenges in effective management and maintaining corporate culture.

Social impact and renewal mechanisms

Digital transformation also creates a series of new industries such as data engineers, cybersecurity experts, cloud system managers, digital marketing experts, user experience design (UX/UI), or digital supply chain management.

These are jobs with high added value, attractive income and long-term development opportunities. However, the number of skilled workers to meet this need is still limited. The gap between human resource needs and supply capacity creates the risk of "labration disorder": lack of high-quality human resources but surplus of simple labor.

According to the Hanoi Employment Service Center, the digital transformation process is and will continue to reshape the Hanoi labor market in a way that opens up many opportunities and poses many challenges. The key issue is not whether the industrial sector will replace workers or not, but whether the society and training system will prepare quickly enough to help workers move to new positions or not. Therefore, managing this transformation process requires coordination between businesses, authorities and training institutions, to ensure that the benefits of technology are spread fairly and sustainably.

Quỳnh Chi
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