The 4.0 industrial revolution and challenges towards tourism’s labor in Viet Nam: Case study in the red river delta and the northeast coast

65 THE 4.0 INDUSTRIAL REVOLUTION AND CHALLENGES TOWARDS TOURISM’S LABOR IN VIETNAM: CASE STUDY IN THE RED RIVER DELTA AND THE NORTHEAST COAST MA. Nguyen Thi Ngoc Anh ngocanh.hrm@gmail.com University of Labour and Social Affairs Dr. Vu Dinh Hoa vudinhhoa@apd.edu.vn Academy of Policy and Developmnetn Abstract The quality of human resources is one of the most important factors in the development of tourism sector in Vietnam nowadays. According to the assessment of national offices and specialized organizations over the past years, the quantity and quality of human resources in the tourism industry has been continuously increased to meet the rising requirements of the socio-economic development process together with the international economic integration. However, in the tendency of the rapid development of the 4.0 Industrial Revolution, national human resources within tourism sector in general and the human resources within the Red River Delta and the Northeast Coast in particular are facing many specific challenges. One of that difficulties is in both shortage and weakness in term of quality labours which has not met the requirements of integration and development in the 4.0 era. This study explores the characteristics of the Fourth Industrial Revolution and its major impacts on human resources in the tourism sector (particularly in the Red River Delta and the Northeast Coast). On the basis of identifying the challenges faced by human resources in two these regions, we have proposed some policy recommendations for the tourism industry in two regions and nationwide to integrate and response effectively to the trends of the 4th Industrial Revolution. Keywords: Tourism, tourism human resources, The Red River Delta and the Northeast Coast, the 4th Industrial Revolution. 1. Introduction Nowadays, the world is dramatically developing the revolution with technology foundation 4.0 (TIR 4.0) with the breakthrough in technology, internet, digital, virtual reality,... Many experts said that TIR 4.0 will have a huge impact on: (i) the structure and level of economic development; (ii) economic growth; (iii) business model; (iv) Labor markets of many countries. Specifically for the labor market, the most basic thing will be the challenge between the quality of labor demand and supply as well as the labor force structure. When automation replaces human in many fields of the economy, workers will likely force to adapt quickly to modify in production that otherwise they would be redundant or out of work. 66 Throughout the "Vietnam Tourism Development Strategy to 2020 with a vision to 2030", "Master Plan for Vietnam Tourism Development to 2020 with a Vision to 2030", "Master Plan Develop tourism in the Red River Delta and the Northeast Coast to 2020 with a vision to 2030", tourism has always been identified as an important economic sector with the goal of becoming a key-leading economic sector which accounts high proportion in GDP structure, creates motivation for cultural and social development in modern and diversity direction. To achieve the set out objectives, we have to focus on developing all kinds of resources (resources, capital, science and technology, human,...), the first and foremost thing is human resource which determines the development of all nations in the era of 4.0. 2. Method The research mainly applies the method of descriptive statistics, comparing combined with analysis, evaluation based on secondary data sources which surveyed and collected from Department of Tourism; Department of Culture, Sports and Tourism of the provinces in the Red River Delta and the Northeast Coast; and data from the Institute for Tourism Development. 3. Results 3.1 The 4.0 Industrial Revolution and the change in labor supply and demand The concept of Industry 4.0 or the Fourth Industrial Revolution (4.0 IR) was formed on the basis of the third revolution - the digital revolution, the use of electronic devices, Information technology to further automate the manufacturing process [4]. 4.0 IR is not limited to automation, intelligent and connected systems, but also covers a wide range of developmental spans of breakthroughs in a variety of areas: genes to nanotechnology, 3D printing, from renewable energy to quantum computing [2, p10]. In other words, this is the fusion of these technologies and their interaction in the fields of physics, number and biology [2, p7] - this is the basic factor that makes 4.0 IR different from previous revolution. In particular, in this revolution, emerging technologies and broader innovations are diffused more rapidly and broader than they were in the past - considered the fourth major change with the strongest impact on modern manufacture [5, p5], after the revolution of the 1970s, the revolution of the 1990s, and the revolution of automation took place in the 2000s. According to Professor Klaus Schwab, 4.0 IR briefly understands a term that includes a wide range of modern automation technologies, data exchange trends, manufacturing and intelligent manufacturing. Afterwards, this revolution facilitates the creation of "intelligent plants" with a diverse and flexible structure in which virtual space physics systems will monitor processes, create out a virtual copy of the physical world. Generally, 4.0 IR is a modern revolution based on three main areas: Digital: Include Big Data, Internet connection (IoT), artificial intelligence (AI); The Biotechnology: Applications in agriculture, fisheries, medicine, food processing, environmental protection, renewable energy, chemistry and materials; Physics: New generation robots, self-driving cars, new materials (graphene, skyrmions...), nanotechnology... It is easy to see that 4.0 IR 67 despite its beginnings but it is breaking the structure of most industries in every country, foreshadowing the transformation of the entire production, management and administration system. According to experts' forecasts, the 4.0 IR will be the foundation for a dramatic transition from a resource-based, low-cost labor-intensive to a knowledge-based economy. According to research reported at the World Economic Forum in 2016, the 4.0 IR will create about major changes in labor supply and demand all over the world. A highly automated and innovative economy requires workers to adapt quickly to changes in production otherwise they would be redundant or out of work. In some areas, as predicted, with the arrival of robots, the quantity of employees will be reduced by one-tenth compared to at these time, so that the remaining nine out of ten will be displaced or unemployed; additionally, a plenty of old jobs will be lost. Labor markets in many countries as well as in the globe will strongly differentiate between low skilled and high skilled workers. According to reports here, the 4.0 IR not only threatens to low-skilled workers but also middle-class and high-skilled workers if they are not equipped with new skills - creative skills for the economy in the era of 4.0. 3.2. Human resources in tourism in the Red River Delta and NorthEast Coast and some issues in the context of 4.0 IR 3.2.1. Current situation of tourism human resources in the Red River Delta and North East Coast Human resources in the tourism sector are diverse, including the human resources involved in the development of tourism, including direct and indirect human resources. The direct tourism labours are those who work at national management agencies in tourism labour enterprises (business management officers, professional workers in hospitality, travel companies, tourism transportation,...), tourism trainees in vocational schools, tourism teachers in colleges and universities. Indirect human resource are employees who working in sectors and processes related to tourism such as culture, customs, transport, immigration, agriculture, industry, commerce, public services, environment, post and telecommunication, tourist activities community. Human resources are considered as valuable assets, directly affecting the competitiveness, business efficiency of enterprises as well as the sustainable development of the industry. (i) The quantity of tourism labours: According to the survey and statistics from the Tourism Department, Department of Tourism and Commerce, Department of Foreign Affairs and Tourism in the localities in the region, the number of labours in the area increased rapidly. Indirect labours tend to increase on a larger scale, reflecting the role of tourism and the effectiveness of socialization of tourism. In 2011, there were about 108,375 employees in tourism sector, accounting for 27% of the country's labour force. In 2017, there were 178,671 employees, accounting for about 30% of the labor force in the country. Employees in the hospitality account for nearly 55% of the total. This is in line with the realities of direct labours. In addition, labours in the business related to tourism such as travel, entertainment services, transport, logistics,... also witness for a relatively high proportion. 68 In terms of locality employment structure in 2017, Hanoi occupied over 51.5% of workers in the whole regions, this number in Quang Ninh accounted for 17.4%, Hai Phong accounted for 7.4%. In addition, some localities have developed tourism industry such as Ninh Binh, Hai Duong,... Other localities have less tourist work. The number of tourism’s labours by provinces, 2011 - 2017 (Unit: people) Province 2011 2012 2013 2014 2015 2016 2017 1 Hanoi 57.875 62.150 65.000 68.000 88.000 90.500 92.040 2 Bacninh 1.186 1.340 1.560 1.750 1.800 3.174 3.316 3 Hanam 950 980 1.050 1.120 1.250 1.270 1.290 4 Haiduong 4.000 5.460 6.195 7.020 7.500 6.000 6.125 5 Hungyen 2.260 2.680 2.910 3.080 3.500 3.650 3.780 6 Namdinh 2.745 2.990 3.010 3.200 3.500 3.620 3.640 7 Thaibinh 1.270 1.390 1.185 1.200 1.355 1.400 1.440 8 Vinhphuc 910 950 980 1.020 1.300 5.228 5.650 9 Ninhbinh 1.780 1.810 2.090 4.120 5.000 16.850 17.000 10 Haiphong 10.400 10.900 10.940 12.600 12.850 13.000 13.300 11 Quangninh 25.000 27.190 29.520 32.125 35.000 29.488 31.090 Total 108.375 117.840 124.440 135.235 161.055 174.180 178.671 (Source: Tourism Information Center - General Department of Tourism) (ii) The quality of tourism labours According to the statistics of labours in hospitality in 2017, there were 25,137 employees with bachelor and post-graduation level, accounting for 14.1%, 22,189 employees with diploma and intermediate level accounting for about 12.4%; Other non- professional-tourism level have 26.264 employees, accounting for 14.7%; Unskilled workers account for 109,483, accounting for 61.2% of total employment in the region. In terms of indirect labour force, there is not enough statistics, estimated in 2017 is about 300,210 people, of which under primary level accounts for about 54%, diploma, bachelor and post-graduation level accounted for about 14.2%. Foreign language and computer skills are relatively high. Human resources used language in the region account for about 70% of total human resources. English is the most popular to employees which are about 45%, Chinese, French and other languages with 10%, 8% and 10% respectively. On the informatics level, most of the laborers in the region know how to use the computer for their work. 69 (iii) The structure of human resources by sector, profession and gender, age of the region State managers and tourism activities in the region account for about 2%, of which about 0.7% are state managers and 1.3% work in non-productive units. Human resources in the business sector account for 98% of the workforce, 20% for waiters and bartenders, 20% for room-catering, 10% for food and beverage processing, 10% for reception, 8.5% for tour guidance. In term of gender, overall of female employees in tourism sector is about 52% and tends to increase, while this number of male employees tends to decrease. The structure of human resources among ages level tends to be stable, there is no big change. The tourism sector of the region has a young workforce of under-30-year-olds, accounting for 40-45%, people in the 31-40 age group consist of 35%, people aged 41-50 for 20%, and over-50- year-old accounting for 2-3%. The people in the area are "golden" enough to assume the task of developing the industry. 3.2.2. Some issues with the tourism‟s labours by the region As discussed above, the quantity and quality of tourism‘s labour is on the rise. However, 4.0 IR with the application of the achievements about information technology, control and automation, the regional tourism in particular and national tourism labours in Vietnam in general in front of many issues in scope of quality. Specifically: First of all, the technical level of the labour force remains low. As a service sector characteristic, the activity is mainly about serving, there are many fields that do not require high level of education, so the direct labour force operated at low level (staff serving chamber, notices, cleaning, plant care staffs, security man,...) account for a large proportion. This group has relatively high number of people who have not graduated from high school, accounting for 20-25% of the total human resources of the region. At present, there is no specific statistics and surveys, but preliminary surveys of the authors have found that in some localities such as Quang Ninh, Ninh Binh and Hai Phong, the level of technical expertise still keeps low. Incidentally, innovation and creativity at workplace of the labour persist not high. This can be seen as an obstacle to accessing modern technologies applied in the service sector of the region in particular and the whole country in the context of the4.0 IR. Secondly, knowledge of integration, foreign languages, computer science; creative capacity, leadership, management, administration and practical experience are not sufficient to meet the development requirements of the sector. A small part of employees is not active to self-learning, willing to raising up the level, so that labour productivity is low. Highly trained staffs in state management, business management, policy makers in research and development in the region are still thin and not tight. The quality of human resources in localities is not really equal. Thirdly, technical skills and soft skills are weak. A wide range of tourism‘s labours in the region lack the prescribed professional skills standards, team-work, communication skills are not high as the limitations affect the quality of tourism industry. 70 4. Some enhancements and solutions to improve the quality of tourism human resources in the Red River Delta and the North East Coast are consistent with 4.0 IR. The 4.0 Industrial revolution is an indispensable trend, it is both a challenge and an opportunity for development. Therefore, in the future, to improve the quality of tourism human resources to meet the requirements of 4.0 IR, The Red River Delta and the North East Coast should focus on the following basic solutions: Firstly, it is necessary to improve the policy mechanisms, in line with the realities of the tourism human resources of the region in the new context. To be more practice, the solution forwards are formulating strategies for human resources development in the region's tourism, paying attention to the training of hi-tech human resources which push up the ability to apply information technology. Tourism authorities in the region need to focus on the forecast of human resource needs according to the structure of the industry and the level of training. Based on that, there are timely adjustments in training, in accordance with requirements of socio-economic development in each period. Secondly, it is essential to improve the quality of human resources towards regional and international standards by announcing the need for qualified human resources and tourism to link and promote the forms of effective training: (i) For professional managers and administrators of tourism in localities should be trained, supplemented to ensure the ability to apply information technology, advanced process of working, the capacity to propose, advise on the development of strategies, orientations, policies and regimes, and perform the state management of tourism activities in conformity with the requirements of the economy in the conditions of international economic integration; (ii) For direct tourism‘s labours, it is necessary to be trained in accordance with professional standards in line with advanced programs in the region and in the world, to improve skills and professional skills to perform their high quality, professionalism, meeting the needs of operating management and mastering modern tourism technology systems. In addition, there should be a co-operation training among both national and international enterprises and training institutions to improve their qualifications; (iii) Indirect tourism‘s labours needs to have short-term training programs to supplement the professional and technical knowledge for those who serve in the industry. Thirdly, it is necessary to interchange strongly by training and fostering of tourism human resources of the region with large both national and international tourism enterprises in the region. In the context of the 4.0 IR, human resources must be trained in accordance to meet the requirements of the business. In a simple way, we need to accelerate the development of training at enterprises, to foster schools in enterprises to train human resources in line with the technology and organization of tourism enterprises. At the same time, the strengthening of linkages between tourism training establishments and enterprises, on the basis of corporate social responsibility aimed at the real business is the ―extended arm" in the operation. Its purpose is to facilitate the equipment and technologies of enterprises in the training service and formation of professional capacity for trainees in the process of training and internship enterprise. 71 Fourthly, it takes in consideration about strengthen international cooperation in improving the quality of tourism human resources in the region. Besides, multilateral and bilateral cooperation activities in the fields of tourism such as scientific research, academic exchange; training and fostering of teachers and managers should be strengthened. Moreover, the change begins from creating appropriate conditions for the legal and social environment for foreign investors to set up and operate high-quality tourist training establishments in the region and carrying out association and cooperation specialized in vocational training. 5. Conclusion The 4.0 IR with its broad application about the achievements of information technology, control and automation poses many challenges to the tourism human resources of the Red River Delta and the Northeast Coast. Training and development of tourism human resources is aimed to balance the structure of the industry, labor force at a high level at which is appropriate strategies, planning for developing tourism human resources. In addition, standardization of tourism human resources focusing on managerial and skilled scope plays an important task of the region in contributing positively to promote the sustainable development of enhanced the status and position of the tourism in region compared to the nationwide. 6. References 1. Ministry of Culture, Sports and Tourism (2011), ―Vietnam tourism development strategy to 2020 with a vision to 2030”. 2. Industry 4.0 the new industrial revolution how europe will succeed, publisher Roland Berger strategy consultants gmbh (2014). 3. Nguyễn Thị Hiền, Đỗ Thị Bích Hồng - Institute of Banking Strategy (2017), The impact of the 4th industrial revolution on the financial and banking sector , 4. Larry Hatheway (2016), Mastering the Fourth Industrial Revolution, Project Syndicate. 5. Hermann, Pentek, Otto (2015), Design Principles for Industrie 4.0 Scenarios, Published in: System Sciences (HICSS), 2016 49th Hawaii International Conference. 6. Research Institute for Tourism Development (2013), Master plan for tourism development in the Red River Delta and Northeast Coast to 2020 with a vision to 2030.