The semiconductor industry has become and continues to be a pillar of the global economy, with a pivotal role in driving technological advancement and economic growth. With revenue projected to reach $600 billion this year, the industry is one of the most fiercely competitive in the world.

Against this backdrop, the Vietnamese Government has introduced various policies to promote the high-tech industry, such as the “Made in Vietnam” strategy and the national digital transformation initiative. The semiconductor industry has been identified as one of the government’s priority sectors, with the potential to generate high added value and elevate Vietnam’s position in the global value chain.

Lacking a skilled workforce

Vietnam possesses several Advantages for developing its semiconductor industry, including a young workforce, competitive labor costs, and a strategic geographic location in Asia. Meanwhile, rising global demand for semiconductor chips presents opportunities for it to participate in manufacturing, assembly, and testing phases.

However, the country also faces significant challenges. High-tech infrastructure remains limited, and there is a serious shortage of skilled professionals in the field. According to the Ministry of Science and Technology, Vietnam requires 5,000-10,000 semiconductor engineers annually but current training capacity meets only about 20 per cent of that demand. This underscores that workforce development is a key factor for the country to remain competitive in the semiconductor industry.

The industry involves a complex value chain comprising three main stages: design, fabrication, and packaging / testing. Each stage generates distinct sub-sectors with specific workforce requirements. First, the design phase is the most creative, where engineers must apply in-depth knowledge of electronics and software to develop intricate integrated circuit (IC) designs. Next, the fabrication stage focuses on producing semiconductor wafers through sophisticated physical and chemical processes. Here, process engineers play a crucial role with their expertise in materials, chemicals, and manufacturing technologies, while technicians must be highly skilled to operate advanced equipment. Finally, the packaging and testing stage is the last step, where chips are assembled and quality-tested before shipment.

In terms of workforce demand, design engineers are the most difficult cohort to train due to the requirement for deep domain expertise and exceptional creativity. To become a skilled design engineer, one typically undergoes long-term training, often in the order of five to ten years, covering both academic education and practical experience in IC development.

In contrast, packaging and testing technicians are easier to train, as their work primarily involves machine operation and implementing standardized quality control procedures, with training typically taking from six months to two years. Process engineers fall somewhere in between, requiring both theoretical knowledge and hands-on production skills, and generally take around three to five years to train.

These differences arise from the varying complexity and creativity of each stage. Workforce development strategies for the semiconductor industry should therefore prioritize training efforts based on the level of difficulty and foundational importance of each job group.

Experience of Taiwan and Malaysia

Taiwan’s semiconductor development strategy is a clear testament to long-term vision and strong national commitment to establishing the industry as an economic pillar, with the goal of contributing approximately 15-20 per cent of GDP. Spanning over three decades, the strategy is divided into three distinct phases, each with specific objectives aimed at steadily enhancing Taiwan’s position in the global semiconductor landscape.

The first phase, from 1980 to 1990, focused on building low-cost manufacturing capabilities by leveraging inexpensive labor to attract foreign companies to set up factories in the country. The second phase, from 1990 to 2000, marked a shift towards heavy investment in research and development (R&D) and chip design, with the aim of adding higher value and reducing reliance on foreign corporations. The third phase, from 2000 to the present, saw Taiwan develop cutting-edge technologies and expand globally, with leading firms like TSMC and MediaTek emerging to establish it as a global semiconductor powerhouse.

In terms of workforce development, Taiwan prioritized training manufacturing engineers before moving on to design and R&D engineers. This strategic sequencing was driven by a fundamental logic: manufacturing provides the basic infrastructure and immediate entry into global supply chains, generating revenue to invest in more complex stages later.

In the early stages, Taiwan concentrated on training manufacturing engineers and technicians to operate factories efficiently at low cost. Once a solid foundation was established, the second and third phases shifted focus to design engineers and researchers who could innovate and compete in higher-end market segments. It invested approximately $100 billion in this strategy overall, with its success underpinned by close collaboration between government, businesses, and academic institutions.

The key to its success lay in policy consistency, long-term investment commitment, and a strong work ethic among its people.

In the 1990s, meanwhile, Malaysia launched the Multimedia Super Corridor (MSC) initiative and invested in high-tech education to promote its semiconductor industry. However, these efforts were hindered by a lack of policy consistency and long-term vision.

Malaysia also faced “Brain Drain”, as many skilled engineers had sought better opportunities abroad due to low salaries and poor working conditions.

The country’s innovation ecosystem remained underdeveloped due to limited collaboration between universities, research institutes, and businesses. Universities emphasized teaching over applied research, while many local factories were merely offshore assembly sites for multinational firms like Intel, offering little support for local technological development. Underlying these issues were bureaucratic inefficiencies and the absence of strong government incentives or support mechanisms.

Malaysia also lacked robust cooperation between industry and academia as well as effective talent attraction and retention programs. Unlike Taiwan’s successful “Reverse Brain Drain” initiatives, Malaysia’s insufficient investment in joint research and attractive incentive schemes contributed to the widening gap between the two in semiconductor capability.

Lessons for Vietnam

Vietnam can draw several key lessons from this experience in developing human resources for the semiconductor industry. The most crucial takeaway is that it must implement consistent support policies with clearly defined priorities.

First and foremost, Vietnam needs to make substantial investments in education and training. This includes expanding specialized semiconductor programs at universities and research institutes, as well as following Taiwan’s example by establishing modern research centers and laboratories. These efforts lay the foundation for building a high-quality talent pool.

Second, fostering collaboration between industry and academia is vital. The government should encourage semiconductor companies to partner with universities in developing practical training programs and offering internships, helping students gain exposure to the latest technologies.

Third, attracting and retaining talent requires supportive policies such as simplified visa procedures, tax incentives, housing for international experts, and initiatives to encourage overseas Vietnamese professionals to return home.

Fourth, investing in R&D is essential to develop core technologies and specialized chip products. This can be achieved through the establishment of R&D centers that drive innovation.

And fifth, creating a favorable business environment is necessary. Vietnam should develop dedicated industrial parks and offer incentives to attract major global players like Samsung, Intel, and TSMC.

Among these, investment in education and training remains the most critical, as it serves as the backbone of all other efforts and determines the sustainable development of Vietnam’s semiconductor industry.

^(*) Dr. Le Trung Hieu and Dr. Nguyen Dinh Trung are from the University of Economics and Business – Vietnam National University, Hanoi.

A closing ceremony for the project “Institutional Strengthening and Capacity Building for Sustainable Urban Development in Vietnam” (ISCB) was held in Hanoi on August 1 by the Ministry of Construction, in collaboration with the United Nations Human Settlements Program (UN-Habitat) and the Embassy of Switzerland, Swiss Cooperation Office in Vietnam.

The project, financed by the UN-Habitat and Switzerland, lays the foundation for a renewed vision toward sustainable urban development in the country, the Government News remarks.

As part of the event, participants visited a curated showcase illustrating Vietnam’s urban transition, comparing baseline conditions in 2020 with the progress achieved through ISCB initiative. While having rapid urbanization, Vietnam still faces significant challenges, including spatial inequality, fragmented policy implementation, and a shortage of skilled professionals in integrated urban planning.

The ISCB project was specifically designed to address these gaps by reinforcing institutional frameworks, delivering practical and context-responsive training, and promoting multi-stakeholder planning approaches that align with international best practices.

Representatives from UN-Habitat and Switzerland echoed these views, reaffirming Vietnam’s growing role in the global urban development agenda and commending the ISCB project’s forward-looking, inclusive approach, particularly at a time when the country is undergoing historic administrative consolidation and restructuring.

The Government News quoted Mr. Aldo de Luca, Deputy Ambassador of Switzerland to Vietnam as saying that “Sustainable urban development begins with strong institutions, empowered communities, and inclusive planning. Switzerland is proud to support Vietnam in shaping resilient, liveable, and economically vibrant cities through strengthened urban policies and institutional capacities.” –

One of ISCB’s key achievements is the development of a Sustainable Urban Development (SUD) Training Program, comprising six modules. These modules were co-designed based on the training capacity of the Academy of Construction Strategy and Cadres Training, international experience from UN-Habitat and development partners, as well as needs assessments from local agencies within the Academy’s partner network.

The six training modules were piloted through nine capacity-building courses, directly implemented by the Academy with technical support from UN-Habitat. The program attracted hundreds urban managers and technical officers across various provinces.

In addition, 37 trainers successfully completed the Training of Trainers (ToT) course, 20% of whom went on to facilitate and coordinate SUD courses. This laid the foundation for a self-sustaining network of trainers and technical advisors, enabling localities to continue accessing knowledge and tools for sustainable urban development beyond the project’s lifecycle.

At the same time, the global toolkit “Our City Plans” (OCP), which is developed by UN-Habitat to promote participatory planning, was localized, refined, and piloted in Vietnam. Serving as a flexible and adaptable framework, OCP empowers inclusive urban planning from the grassroots to the provincial level. It guides local governments and communities to co-create visions, design public spaces, and implement development plans through collaborative and participatory methods.

Sustainable urban development requires the stability and comprehensiveness of policy and regulatory frameworks related to urban development management.

Within the framework of the ISCB project, institutional strengthening activities have been implemented to support the Ministry of Construction and the former Ministry of Planning and Investment (now the Ministry of Finance) in enhancing their policy-making capacities.

Both national and international experts shared knowledge, experiences, and practical assessments to support the development and implementation of legal and regulatory documents related to urban management and development.

For the former Ministry of Planning and Investment, the project focused on working with the Department of Planning Management to assist in the formulation of provincial planning, and to promote cross-sectoral coordination in the revision and amendment of the Planning Law.

ISCB’s policy recommendations, tools, and training materials were aligned with the Sustainable Development Goals (SDGs) and the New Urban Agenda, contributing to Vietnam’s broader commitment to inclusive and sustainable urban growth.

A key highlight of the event was a demonstration of the participatory planning approach. Through pilot activities in the former province of Ben Tre (now Vinh Long) in the Mekong Delta and in the former town of Tam Ky in the central province of Quang Nam (now Tam Ky Ward in central Da Nang city), the project created conditions for communities to take an active role in shaping visions, designing public spaces, and providing policy feedback. More than 1,000 residents and local officials participated in consultation sessions, surveys, co-design workshops, and co-creation processes, clearly illustrating a shift from “being planned for” to “planning together.”

Mr. Frank D’hondt, ISCB’s Chief Technical Consultant, presented the project’s overarching strategic vision, linking it with Vietnam’s international commitments and the SDGs. A panel discussion featuring representatives from the Ministry of Construction, Swiss Cooperation Office in Vietnam, and national training academies reinforced the need for intersectoral coordination in planning, capacity-building, and financing local initiatives in the post-project phase.

In his closing remarks, Mr. Ngo Anh Tuan, Director General of the Academy of Construction Strategy and Cadres Training, as quoted by the Government News, affirmed that: “The ISCB project has helped clarify the reality that sustainable urban development cannot rely solely on infrastructure investment. It must start with strong institutions, capable people, and transparent processes. The results of the project will continue to be integrated by the Ministry of Construction into national action programs, technical guidance documents, and future policies supporting localities”.

The tools, outcomes, and lessons from ISCB will continue to be disseminated through a growing network of experts, training institutions, and technical assistance mechanisms. As Vietnam enters a new phase of complex urban challenges, ISCB leaves behind a practical foundation to ensure that localities will not walk this path alone.