Are foreign degrees all they’re cracked up to be in Vietnam?

Are foreign degrees all they're cracked up to be in Vietnam?
A Vietnamese woman wearing a face mask rides on a bridge amidst a blanket of smog over Hanoi on March 28, 2018. Source: AFP/Manan Vatsayana

When it comes to well-paid and fulfilling careers, are foreign degrees really the answer many advocates believe it to be?

At first glance, the benefits of going from a developing nation to a developed one is clear: Better-ranked universities. A (usually) Western-style, inquisition-based learning. Intercultural experience. Self-discovery. Chance to practise the English language.

However, a new book by Sydney educational sociologist Lien Pham cautions against a wholesale belief of this hype. While the value of an education is priceless, Pham’s research reveals the tough economic reality many returning graduates face in Vietnam’s current labour market.

As a financial calculation, the return on investment – ie. the cost of attending set against future earnings – from a foreign degree is not great.

A foreign degree is useful in getting jobs in Vietnam, but it has its own suite of disadvantages too. Source: Shutterstock

We caught up with Dr Pham via an email interview to dig a little deeper:

Study International (SI): What are the expected returns of investment Vietnamese students want from a foreign degree?

Most Vietnamese students and families look for economic returns for their foreign education through jobs and high salary. The majority want to stay abroad, perceiving there are better job opportunities and careers for them overseas, especially for those with research degrees.

In Vietnam, these foreign graduates prefer to work for foreign-owned companies, especially multinational corporations (MNCs) in Vietnam. They believe there is prestige associated with MNCs, are better suited to them given they have foreign experience and that they can use their overseas-acquired skills and attributes like communication, English, problem-solving, critical thinking skills, etc, in these firms. Most importantly, they perceive that MNCs pay higher salaries than Vietnamese firms, although this really depends on the sector.

SI: Does this expectation match with the reality of working in Vietnam today? Why?

Many operations in Vietnam tend to be in manufacturing, supply chain and distribution. Thus, foreign graduates have to take on managerial role in non-technical areas like quality control in a manufacturing company, or head of sales. These roles do not allow them to apply their technical skills and knowledge gained from overseas.

So, this means that their expectation of high salaries put them in a narrower range of career options that do not harness their technical skills and knowledge. Another reason is that economic development in Vietnam is far behind the economic development in host countries, which are advanced economies in the West.

Those who work in local firms cannot directly apply the knowledge learned about industries that are pitched for Western contexts.

Vietnamese employers (particularly government agencies or state-owned enterprises) also discriminate against overseas-educated graduates because their perception of foreign graduates as direct, assertive as well as lacking knowledge about local industries and personal connections.

SI: Which group of students are most and least likely to benefit from an education abroad? Why?

Master graduates benefit the most because they had prior work experience in Vietnam so they have local knowledge. Their time abroad is also shorter so they do not lose personal connections made prior to going overseas. Most return to their firms as required by their scholarships and can contribute directly to their workplaces.

PhD graduates benefit by being able to climb the career ladder, but do not harness their research skills. Indeed, many PhDs were motivated to study abroad to qualify for management roles in their faculty. This is because the teaching remuneration is very low. They then have the power to introduce new overseas programs or collaborate with international universities thus may gain some financial benefits from the programs’ tuition fees.

Undergraduates benefit the least because they lack connections and may have no entry point to jobs. Those that studied in new service sectors like IT, computer, or financial services do well in terms of jobs and high salaries, as well as using their overseas degree skills and knowledge. This is because their employers tend to be Vietnamese overseas that return home to start businesses. This sector also has more Vietnamese entrepreneurs, overseas firms and business investment.

Undergraduates in traditional sectors like agriculture, manufacturing or logistics, do not do as well because the main employers in these sectors, ie. the majority of the labour market, are Vietnamese firms, which do not pay well and discriminate against them.

SI: In this article by Times Higher Education, you said “… although overseas-acquired qualifications boost earnings in Vietnam, the payoff does not cover the investment. And the country is also short-changed, for cultural and structural reasons”. Can you explain what you mean by “short-changed, for cultural and structural reasons”?

Although foreign firms offer higher than average salaries in Vietnam, it is far from covering the cost of their overseas degree.

For example, a graduate at an MNC may earn at best US$1,000 per month or US$12,000 a year. A foreign degree costs on average US$40,000 for tuition. With living costs, it’s around US$100,000 or more.

This means it will take about 10 years to recover the cost of investment, assuming no opportunity costs. For those earning less than US$1,000 per month, the return will be a lot less. Moreover, as they can’t develop the technical or technological knowledge gained abroad, it becomes a missed opportunity to develop themselves and the country.

Vietnam becomes short-changed when this happens as it misses out on the skills and knowledge students can contribute to enhance the country’s professional standards, economy and human capital. This limits sector development and productivity.

What can graduates and current students do to close this gap between expectation and reality?

If graduates can lower their expectations on salary and wanting to work in a foreign firm, they can apply their skills and knowledge for local firms. They can be more adaptable to the working culture in Vietnamese firms and develop the necessary cultural intelligence to work in these firms as part of their re-try into Vietnam.

Universities abroad have the responsibility to include opportunities for these students to intern or undertake placements in local firms and not just in host countries. This would give students the work experience and connections necessary.

State-owned enterprises have been reported to discriminate against foreign graduates: Source: AFP/Hoang Dinh Ham

The Vietnamese government should have concrete policies for returning graduates, for example by providing opportunities in Vietnamese firms or state-owned enterprises that are directly aligned to their study discipline, as well as establish networks with universities abroad for career pathways and advice.

SI: What advice do you have for Vietnamese students planning to study abroad?

When abroad, seek out opportunities back home as part of your career planning. Ask for internships that can be conducted in Vietnamese firms or in industries similar to that in Vietnam. Establish networks in Vietnam and overseas, and continue to develop or build on those when you return home.

This interview has been edited for length and clarity.

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