HANOI • Mr Nguyen Van Duc graduated two years ago with a bachelor's degree in economics from one of Vietnam's best universities.
Today, he earns about US$250 (S$340) a month as a motorbike taxi driver in Hanoi.
Mr Duc, whose parents took second jobs so he could be the only one of three children to attend college, is among thousands of Vietnamese college graduates who cannot land jobs in their chosen field, even though the nation's unemployment rate is just 2.3 per cent.
"In university, we only received heavy theoretical training and a lot of Ho Chi Minh's ideology with Communist Party history," the 25-year-old said.
While Vietnam's schools equip students with basic skills for low-wage assembly-line work, its colleges and universities are failing to prepare youth for more complex work.
As wages rise and basic manufacturing leaves for less expensive countries, this may threaten the government's ambition to attain middle-income status, defined by the World Bank as per capita income of more than US$4,000, or almost twice the current rate.
Mr Scott Rozelle, a Stanford University development economist, said: "Countries that have been successful moving up to the next economic stage already had developed country levels of education when they were middle-income economies.
"Countries that did not have that collapsed or became stuck in the middle-income trap."
Singapore, South Korea and Taiwan developed high-quality colleges long before their economies needed a more educated workforce, he added.
College students frequently spend much of their first two years learning about revolutionary leader Ho Chi Minh, socialism and party history at the expense of critical thinking and other skills expected by employers. The upshot: Firms are reluctant to pay more for workers with degrees who often lack commensurate skills, said the Vietnam Chamber of Commerce and Industry. The jobless rate among young people with university degrees is 17 per cent.
Mr Nguyen Xuan Thanh, a senior fellow at the Harvard Kennedy School of Government in Ho Chi Minh City, said: "You have private and foreign companies arriving that want better skilled workers, quality managers and engineers.
"The middle class is expanding. Vietnam families want better education. So the pressure is on the political system to deliver."
More parents are now sending their children overseas to study to improve their work prospects.
Mr Nguyen Minh Thuyet, who is overseeing the Vietnamese Education Ministry's new curriculum strategy, said: "The government is trying to improve the quality of training in college and university.
"We need to overhaul their curricula to reduce training of impractical subjects. But the progress is still very slow. Not much has been done."