Việt Nam’s engagement recession hits productivity amid shifting workforce expectations

Việt Nam’s engagement recession hits productivity amid shifting workforce expectations

Employee disengagement is rising across Việt Nam, weighing on productivity as businesses struggle to keep pace with shifting workforce expectations.

Job seekers attend the second 2026 hybrid job fair held across HCM City, Bình Dương and Bà Rịa–Vũng Tàu. — VNA/VNS Photo

Signs of an engagement recession are emerging in Việt Nam’s workplace, mirroring broader labour trends across Southeast Asia as companies grapple with shifting workforce expectations, talent shortages and the growing impact of AI.

New research by Robert Walters shows that 77 per cent of employers in Việt Nam have observed declining productivity linked to employee disengagement, with nearly half describing the issue as widespread. Among professionals, ‘quiet cracking’, where employees remain at work but struggle internally, is increasingly common.

Half of employees say they experience this occasionally while 38 per cent face it frequently. Only 6 per cent report it rarely and another 6 per cent never, indicating widespread but often overlooked psychological strain in the workforce.

The trend reflects deeper structural pressures across Southeast Asia, where tight labour markets and rapid digital transformation are reshaping employer–employee dynamics. Strong demand for skilled talent – particularly in technology, finance and emerging green sectors – is pushing employers to balance productivity with rising expectations around flexibility, purpose and career progression.

In Việt Nam, these pressures are compounded by a fast-growing economy and a young, digitally active workforce. The rise of AI is also adding complexity, with employers reporting a surge in AI-generated job applications and placing greater emphasis on human judgement in recruitment.

Phúc Phạm, country manager of Robert Walters in Việt Nam, said: “Disengagement often starts quietly but can have a real impact on productivity, morale and retention if left unaddressed.”

Businesses in Việt Nam are increasingly recognising that supporting employee wellbeing, providing clear career development pathways and strengthening leadership capability are key to maintaining performance amid intensifying competition for talent.

He added that in a period of ongoing uncertainty, employee engagement should be treated as a long-term priority rather than a short-term fix.

In response, businesses in Việt Nam are taking steps to improve engagement. About 43 per cent say they are focusing on career development programmes to build long-term motivation, while 29 per cent are reducing workloads to ease pressure. Another 14 per cent are investing in leadership training.

Meanwhile, younger professionals remain forward-looking. A global survey by Randstad found that 79 per cent of Gen Z workers are confident in their ability to acquire new skills while 85 per cent prioritise long-term career goals over immediate pay.

Deloitte’s 2025 Gen Z and Millennial Survey also shows a growing focus on career development, stability and meaningful work, suggesting that disengagement may stem less from a lack of ambition than from a gap between expectations and workplace realities.

In Việt Nam, this gap is becoming more visible as businesses navigate rapid growth, rising competition for talent and shifting workforce expectations. Analysts say companies that align career development, workplace culture and leadership capability with employee expectations will be better positioned to sustain productivity and retain talent. 

Bizhub