Productivity effect of efficiency wages at small and medium-sized manufacturing enterprises: The case of Vietnam

Tung Nhu Nguyen Article Productivity effect of efficiency wages at small and medium-sized manufacturing enterprises: The case of Vietnam Global Business & Finance Review (GBFR) Provided in Cooperation with: People & Global Business Association (P&GBA), Seoul Suggested Citation: Tung Nhu Nguyen (2023) : Productivity effect of efficiency wages at small and medium-sized manufacturing enterprises: The case of Vietnam, Global Business & Finance Review (GBFR), ISSN 2384-1648, People & Global Business Association (P&GBA), Seoul, Vol. 28, Iss. 6, pp. 130-144, https://doi.org/10.17549/gbfr.2023.28.6.130 This Version is available at: https://hdl.handle.net/10419/305931 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. 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Introduction The linkage between factors of production and labor productivity has long received attention from researchers, professionals, and policy-makers (Ugur et al., 2016). A new research trend in productivity is related to the impact of efficiency-driven initiatives Received: Jul. 17, 2023; Revised: Aug. 8, 2023; Accepted: Aug. 21, 2023 † Corresponding author: Tung Nhu Nguyen E-mail: [email protected] on firmand plant-level labor productivity (Sartal et al., 2020). From the efficiency view, enterprises with limited capital are interested in using labor efficiently (Tran & Santarelli, 2014). This study focuses on the productivity of small and medium-sized enterprises because they play a vital role in economic growth in most nations (Wijayanti et al., 2016). However, given its resource difficulties, a manufacturing SME needs to use its workers efficiently to maximize outputs per direct labor. The quality of labor is crucial for achieving labor GLOBAL BUSINESS & FINANCE REVIEW, Volume. 28 Issue. 6 (NOVEMBER 2023), 130-144 pISSN 1088-6931 / eISSN 2384-1648∣Https://doi.org/10.17549/gbfr.2023.28.6.130 ⓒ 2023 People and Global Business Association GLOBAL BUSINESS & FINANCE REVIEW www.gbfrjournal.org1) Productivity Effect of Efficiency Wages at Small and Medium-Size d Manufacturing Enterprises: the Case of Vietnam Tung Nhu Nguyen† P h.D., School of Business, International University - Vietnam National University Ho Chi Minh City, Vietnam A B S T R A C T Purpose: This paper aims to investigate whether efficiency wages for production workers have a positive effect on labor productivity in Vietnam's manufacturing SMEs. Design/methodology/approach: The research analyzes the panel data of manufacturing SMEs collected by UNU-Wider in Vietnam in 2011, 2013, and 2015. Findings: The panel-data analysis results for 6,953 observations show that efficiency wages increase labor productivity. Research limitations/implications: The scope of this study is limited to Vietnam's manufacturing SMEs. Future studies should include replicating the research model in the service sectors and other countries. Originality/value: Previous studies on Vietnamese manufacturing SMEs did not disclose the impact of efficiency wages on firm-level labor productivity using the SME panel datasetVietnam's. The novelty of this study is the introduction of the efficiency wages as an explanatory variable forto labor productivity. The study results shed light on organizational behavior in rational salary decisions. Many of SMEs have decided to pay lower than the average sector wage. NeverthelsessStill, the regression analysis indicates that salary growth improves per-worker productivity. This discovery allows researchers to investigate why SMEs have decided not to raise worker wages significantly while wage increases helps boost labor productivity. As a practical contribution, the study result recommends that for higher labor productivity at lower labor costs, manufacturing SMEs can raise their workers' salaries based on the average sector wage instead of benchmarking them with the average nation-level wages. Keywords: Labor productivity, Efficiency wage, Small and medium-sized enterprises, Manufacturing, Vietnam ⓒ Copyright: The Author(s). This is an Open Access journal distributed under the terms of the Creative Commons Attribution Non-Commercial License (https://creativecommons.org/licenses/by-nc/4.0/) which permits unrestricted non-commercial use, distribution , and reproduction in any medium, provided the original work is properly cited. Tung Nhu Nguyen 131 efficiency (Huynh et al., 2022). To retain quality labor, an SME must address the problem of setting an attractive wage. Furthermore, recent studies have found a correlation between efficiency wages, defined as the ratio of the average firm-level wage to the average sector wage, and productivity (Ranjan & Raychaudhuri, 2011; Sartal et al., 2020; Syverson, 2011). Nevertheless, there is still a need for further research on this link. Although related studies have indicated that wage growth depends on productivity improvement (Berger et al., 2022; Meager & Speckesser, 2011), relatively few have examined the reverse causality, specifically the effect of efficiency wages on labor productivity at the firm level in different country contexts (Akerlof, 1984; Meager & Speckesser, 2011; Yellen, 1984). Exploring whether various organizational conditions yield different results on the same research design causes curiosity among researchers. For example, in a study in Spain, the positive effect of efficiency wages on productivity is only significant for supervised workers but insignificant for unsupervised workers (Giménez-Nadal et al., 2021). To the best of knowledge of the author of this paper, no previous studies in Vietnam have expanded the production function to include efficiency wages as an input variable for labor productivity inat small-sized manufacturing firms using panel data. This article investigates the effect of efficiency wages on firm-level labor productivity. SMEs need to recognize the benefits of hiring and retaining professionals through attractive remuneration despite their financial constraints. Our choice of research on the issue of labor productivity in manufacturing firms is consistent with previous studies analyzing high-performance work systems (Datta et al., 2005; Sartal et al., 2020). The efficiency wage is higher than the average industry wage because it is based on the competency and skills of the employee, not on the industry wage (Krueger & Summers, 2015). Higher salaries not only incentivize workers to work more effectively for their employers but also play a vital role in the whole economy because the workers have more income to buy more products and services. Morally, firms must pay good wages for their employees to purchase nutritional food to be healthy (Riveros & Bouton, 1994). In the era of the Anthropocene, this aim serves the trendy theme for social justice for workers in low-income countries (Biggeri & Tapia, 2023). Unfortunately, there has been a shortage of studies on the role of efficiency wages in productivityoriented SMEs in developing nations (Love & Roper, 2015). This paper extends the production model with efficiency wages as a new explanatory variable. The study contributes to adapting the productivity model in the peculiar context of Vietnam, which has started its market-oriented economy in the socialist direction after its economic reform ("doi moi") in 1986 (Huynh et al., 2022). Firms in a transitional economy such as Vietnam possess different characteristics from those in developed countries, drawing research interest (Peng, 2000). Despite its recent impressive income growth, one of Vietnam's problems is that its labor productivity is nearly 20 times lower than Singapore's and worse than most regional countries such as Malaysia, Thailand, China, and the Philippines (Kenichi et al., 2021). Moreover, an OECD report indicates that Vietnam stands lower than Singapore, Malaysia, Thailand, Indonesia, and the Philippines in productivity, technology, and innovation. 1) SMEs play a significant role in the economic development of Vietnam. According to the General Statistics Office of Vietnam, SMEs employ approximately 80% of the labor force, but their labor productivity is up to four times lower than that of larger firms (GSO, 2018). Despite their significant contributions, SMEs in Vietnam need to overcome various challenges, including the shortage of skilled labor. To attract and retain the workforce, SMEs must recognize the importance of reasonable wages. 1) OECD Policy Assessment Framework consists of 8 dimensions for ASEAN SMEs: 1) productivity, technology, and innovation; 2) Environmental policies; 3) Access to finance; 4) Access to market and internalization; 5) Institutional framework; 6) Legislation, regulation, and tax; 7) Entrepreneurial education and skills; 8) Social enterprises and inclusive SMEs. Source: OECD (2018). GLOBAL BUSINESS & FINANCE REVIEW, Volume. 28 Issue. 6 (NOVEMBER 2023), 130-144 132 However, due to their small scale, the question is whether paying extra cash for workers is worthwhile as this salary policy increases costs for financially struggling SMEs. The organization of this paper continues with a related literature review, which lays the foundation for the proposed conceptual model. After the literature review, the research methodology is discussed for model specification and data analysis approaches. Next, the results section presents the outputs of the panel data analysis and relevant discussion. Finally, the conclusions also mention some significant contributions of this study to theory and policy -makers. II. Literature Review A. Efficiency Wages and Productivity Efficiency wage refers to the level of pay for a worker a firm chooses such that it minimizes the cost per efficiency unit (Yellen, 1984). It is founded on the shirking model, positing that a highly paid employee would not shirk from work and quit his job because he wants to avoid paying the opportunity cost of his current financial benefits (Goldsmith et al., 2000). From the behavioral perspective, the principles of efficiency wages are constructed on the concept of employer-employee psychological contracts, such as gift exchange (Akerlof, 1984; Sartal et al., 2020). This concept holds that an employee is willing to contribute more to his employer in exchange for higher salaries. Above-average salaries create a financial incentive for workers to work harder and produce more, generating higher outputs for the firm. Solow (1979) believes that higher wages lead to workforce loyalty and hence firms' productivity. From economics view, economists for efficiency wage theory believe that a firm should pay wages for marginal productivity. That is, wages are based on the competency and skills of the employee, or the real wage, not on the industry wage (Krueger & Summers, 2015; Yellen, 1984). A real wage for a worker reflects his competency and skills and measures living standards. When the worker receives real wages, he can afford all the necessities for living, leading to more spending and stimulating the demand for products and services. This contribution of real wages to an economy stemmed from the classical economics literature as early as Adam Smith in the 18 th century (Smith, 1776). The efficiency wage is also considered an input price for a firm's optimization process. Riveros and Bouton (1994) postulated that a firm first chooses a salary that minimizes the average cost of an efficiency unit of labor. After that, the firm selects the level of inputs for profit maximization given the efficiency wage and other input prices. Firms may find it profitable to increase wages even if no external party is punishing them for not doing so (Krueger & Summers, 2015; Mühlau & Lindenberg, 2003). Workers do not quit their jobs because they perceive that they may not receive higher pay in other organizations. Good salaries not only reduce the turnover rate but also increase staff loyalty. Therefore, a company adopting the principle of efficiency wages saves money on recruitment and training. From the health perspective, a worker can live a healthier life with a higher income because he eats well and stays well. As a result, he will be more productive. According to nutritional theories, there are positive associations among high wages, health and productivity, and workers' health in developing nations (Riveros & Bouton, 1994). Workers in developing countries must buy more nutritional food to be healthier for better work performance. If their firms pay them sufficient money to eat nutritious food, they have more energy to increase their output rate. Therefore, the costs of higher payments to employees are canceled off by increased outputs. Unfortunately, in poorer nations, most populations live at the subsistence level of income, which cannot guarantee nutrition and energy for hard work (Haque, 1995; Riveros & Bouton, 1994). This health problem may partially explain poor labor productivity in developing countries. Tung Nhu Nguyen 133 Nevertheless, the theory of efficiency wage contradicts the results of previous studies that wage change is the outcome of changes in a firm's profitability and productivity, not the other way around (Blanchflower et al., 1996; Bloom & Reenen, 2010). Some scholars argue that the wage-productivity relationship is reciprocal. This argument means that higher labor productivity is likely to reduce labor input. For example, when a firm has set up a process or technology for high volume per production run (e.g., product-focused or assembly lines), labor does not contribute much to productivity; hence, any change in wages does not matter (Mankiw, 2020). On the other hand, firms with low profit and productivity may seek to reduce labor costs, including salaries. From the above literature, we hypothesize that paying workers above-average wages positively impacts productivity. However, there are some challenges to this proposition. First, if a company pays higher wages for many periods without increased productivity as a return, it may become less competitive in cost leadership. Another challenge to this theory is the business environment and the characteristics of organizations. For example, Romer (2001) posited that in an economy with a high unemployment rate, employees tend to be loyal to their current employer even when they are not well paid. For the manufacturing sectors, when the demand for products declines, the demand for workers slumps, and production workers fear that they cannot find another job, so they accept remaining where they are because switching costs may be too high. In addition, one of the notable characteristics of SMEs is family-based. Family members working for their own enterprises may still work hard, even on weekends, even though they are not highly paid, especially when their businesses are in financial trouble. B. Related Studies Hypotheses related to efficiency wages have been tested in different countries, and the test results have been mixed. For example, in the US, a study in the restaurant industry showed that a raised minimum wage significantly increased firm productivity (Kim & Jang, 2019). A panel-data analysis offor 4,090 observations for the period 2001-2009 in manufacturing plants in the US also confirmed the positive effect of efficiency-driven initiatives, including efficiency wages, on labor productivity (Sartal et al., 2020). However, the relationship between these two variables was weak in China (Zhang & Liu, 2013). In addition, a survey on urban efficiency wages in France and Spain for the period 2009-2010 revealed a mixed association between wages and leisure, a substitute measure for shirking at work (GiménezNadal et al., 2021). On the one hand, the research found that the higher monthly earnings an employee made, the more leisure he enjoyed, leading to less work efforts and lower productivity. On the other hand, this finding is only significant among nonsupervised workers in Spain. It implied that nonsupervised workers were prone to shirking at work, no matter how much more they earned, while supervised workers were more disciplined. It suggests that a supervision mechanism is critical to ensure that workers make efforts at work. This finding also showed that when workers with long commuting time received higher wages, they were more likely to reduce their shirking action, increasing labor productivity. The author of this paper argued that increased wages were financial incentives for workers who have to commute far from the workplace. Shirking behavior is not only caused by the lack of motivation. Sometimes this action is waged by labor unions. Min and Yi (2017) argued that lower wages made labor unions encourage workers to shirk from work, leading to lower employee productivity due to their strikes. Dosi et al. (2020) found a positive relationship between the elasticities of wages per employee and those of labor productivity across firms for the period 1998 - 2007 in China using the quantile regression method (10th and 90th percentiles of the labor productivity growth rate). The pooled and dynamic quantile estimation results showed that a 1% increase GLOBAL BUSINESS & FINANCE REVIEW, Volume. 28 Issue. 6 (NOVEMBER 2023), 130-144 134 in productivity was associated with a 0.3% increase in wages. A panel-data analysis of 179 Indian microfinance institutions collected over the period 2010-2018 under a fixed-effects model showed that efficiency wage had a solid significant positive effect on employees' productivity as well as outreach (client coverage). Specifically, a unit increase in efficiency wage generated a 7%-9% increase in outreach productivity (Mia et al., 2022). In Europe, a plant-level analysis of 4,090 observations using panel data for the period 2001 - 2009 in Spain revealed that efficiency wages led to an increase in sales of 37.3% per worker (Giménez-Nadal et al., 2021). This study used the GMM estimation method to solve the possible endogeneity problem of explanatory variables, which may occur in the labor productivity model. Ford Motor Corporation adopted efficiency-wage theory to achieve its production objectives. Specifically, as early as 1914, this automobile corporation doubled the daily pay for its workers from $2.35 to $5 (Raff & Summers, 1986). This salary policy was surprising because during this period, the unemployment rate in the US was high, and Ford did not need to raise wages to attract workers (Raff & Summers, 1986). However, the company implemented a high-wage policy. This experience at this giant company proved that top management at this giant company recognized the theory of efficiency wages, and they adopted it to maximize the output rate. In the context of Vietnam, Le (2020) found that convenience store productivity depends on average wages. However, the effect of efficiency wages on labor productivity has not yet been published for Vietnamese manufacturing SMEs. This research gap provides a reason for our hypothesis that efficiency wages (or over-average wages) increase labor productivity in manufacturing SMEs. In sum, the relationship between wages and labor productivity has been theoretically established and empirical studies have been conducted in some countries. Numerous previous studies related to this research topic were biased toward the position that wages should be set according to productivity (Berger et al., 2022; Krueger & Summers, 2015; Meager & Speckesser, 2011). However, fairly few studies have considered efficiency wages as a management input for productivity growth and examined the reverse causality, especially the effect of efficiency wages on labor productivity at the firm level in low and middle-income countries. Exploring whether various organizational conditions yield different results on the same research design causes curiosity to the author of this research. C. Hypothesis Development Our proposed model stems from the Cobb ‒ Douglas production function:     where  ,  ,  , and  are the total output, capital, labor and total factor productivity of firm i in year t , respectively; α and β are the elasticities of output with respect to capital and labor. Dividing both sides by L , we obtain:            Taking the natural logarithm of both sides, we have: ln    ln    ln ln Where:  ⁄ is labor productivity , the ratio of sales revenue to the total number of full-time workers at firm i in year t .  ⁄ is capital intensity , the ratio of physical assets to the number of full-time workers at firm i in year t.  is Firm Size , measured by the total number of full-time workers at firm i in year t. Tung Nhu Nguyen 135  is represented by Efficiency Wage as a management practice at firm i in year t (Ranjan & Raychaudhuri, 2011; Sartal et al., 2020; Syverson, 2011). Based on the above production equation model, we formulate the following hypotheses: Hypothesis 1: Capital Intensity has a positive effect on Labor Productivity Hypothesis 2: Firm Size has a positive effect on Labor Productivity. Hypothesis 3: Efficiency Wage has a positive effect on Labor Productivity We extend the above equation with professional share ( Professional ) and its interaction with efficiency wage. Professional refers to the percentage of professionals in a firm's workforce. Professionals are staff members who have completed college or university education. They form intellectual capital which generates intellectual capital efficiency and improves industrial firm performance (Nguyen & Nghiem, 2023). Based on this extenstion, we develop the Hypothesis 4 as follows: Hypothesis 4: Professional Share increases the positive impact of Efficiency Wage on Labor Productivity. We test the four hypotheses developed as above in the contextual conditions of Vietnam. Our scope of research is limited to Vietnamese manufacturing SMEs, whose characteristics are portrayed as below. D. Characteristics of Vietnamese Manufacturing SMEs In Vietnam, firms are formal when they have an "Enterprise Code Number" or Business Registration Certificate. The rate of local SMEs' formalization (business registration) increased over time (Brandt et al., 2016). In a 2015 SME survey conducted by United Nations University-Wider, 97% of the surveyed SMEs were formal, an increase of 27% from 2013. However, up to 97% of informal SMEs were micro-sized or less than ten employees. These unregistered micro-sized SMEs had difficulty accessing formal loans from financial institutions, as the government's policies encouraged firms to give loans to formal businesses (Brandt et al., 2016). The UNU-Wider survey also revealed that most domestic manufacturing SMEs made labor-intensive products (e.g., garment production). Therefore, labor costs (including wages, insurance, and training) create a financial burden, pressuring them to utilize labor and equipment efficiently. When SMEs are suppliers in supply chains, their buyers, typically largerbigger manufacturers, require them to reduce costs, improve quality and implement responsiveness (Yoo, 2016). Vietnamese SMEs have dramatically grown over the last decades. The General Statistics Office of Viet Nam recorded an average annual increase of approximately 20% in local SMEs and the private sector from 2003 to 2017 (GSO, 2018). SMEs play a significant role in the economic development of Vietnam. According to the General Statistics Office of Vietnam, SMEs employ approximately 80% of the labor force. Still, related data have indicated that Vietnam's manufacturing SMEs face a problem of low labor productivity. The gap in labor productivity between them and large-sized SMEs hasis persistently getting bigger increased over the last decades. For example, large-sized enterprises"' labor productivity, measured in net revenue per employee, wasis 1.5 and 4.5 times greater than that of micro and small-sized enterprises in 2018 (GSO, 2018). Government assistance to Vietnamese SMEs can be categorized into financial incentives and technical support (Hansen et al., 2009). For example, financial incentives include tax breaks or reductions for R&D activities, while technical support assists SMEs with human resource training, export promotion initiatives, and quality or technology programs (Hansen et al., 2009). The following section presents the model of this research for a Vietnamese SME dataset. GLOBAL BUSINESS & FINANCE REVIEW, Volume. 28 Issue. 6 (NOVEMBER 2023), 130-144 136 III. Methodology A. Model Specification From the list of proposed hypotheses developed from Literature Review, we express the following equation (with all variables in logarithmic form) for the study model:     Pr ′ In Equation 1, the subscript i denotes enterprises and t represents time periods.  and  are regression parameters. T is time dummy and  is the error term. LaborProductivity is the ratio of sales revenue to the total number of full-time workers.  is the ratio of physical assets to the number of full-time workers. FirmSize is measured by the total number of full-time workers. EfficiencyWage is the ratio of the average firm-level wage to the average sector wage (Ranjan & Raychaudhuri, 2011; Sartal et al., 2020; Syverson, 2011). B. Data We use secondary data to compute the model variables. The first secondary data come from SME surveys designed and gathered by the United Nations University-Wider (UNU-Wider) in collaboration with the Ministry of Labor, the Invalid and Social Affairs of Vietnam (MOLISA), the Central Institute of Economic Management (CIEM) and the University of Copenhagen. We use these panel data for 2011, 2012, and 2015 (UNU-WIDER, 2018). For each round of the surveys, they published survey reports that described sampling methods on the website of UNU-Wider. The firm population includes formally registered and informally registered enterprises in all manufacturing sectors (Brandt et al., 2016). This study's second secondary data source comes from the Annual Year Books published by Vietnam's General Statistics Office (2011, 2013, and 2015 statistical yearbooks). We use the information on average monthly wages for production workers in each of the manufacturing sectors Vietnam's (General Statistics Office, 2015) to generate the new variable of efficiency wage, which is the ratio of average wages of production workers in a firm to the average salaries of the sector to which that firm belongs (Table 1). C. Model Estimation Strategy We used the econometric approach for this study. We aim to explore the relationships between a vector of explanatory variables and only one outcome variable, i.e., labor productivity, for which the approach's Cobb ‒ Douglas production function is well used (Chiang & Cheng, 2014). A panel-data model requires the selection of an appropriate estimation strategy among ordinary least squares (OLS), random-effects (RE), or fixed-effects (RE) options. OLS estimation may cause inconsistent and biased estimators due to the correlation between observable inputs and unobserved productivity shocks (Rovigatti & Mollisi, 2018). To select an appropriate panel-data estimation strategy, we conduct the BreuschPagan Lagrangian multiplier test and Hausman test (Baum, 2006; Stock & Watson, 2012). If the null hypothesis of the LM test is rejected, the panel model can be used. For the Hausman test, a fixed-effects model is preferred if its null hypothesis is rejected (Baum, 2006; Stock & Watson, 2012). Previous studies on labor productivity using panel data mainly adopted the fixed-effects model or generalized methods-of-moment because the ordinary least squares (OLS) model does not consider the influence of the lagged variable (e.g., the labor productivity of the previous period) (e.g., Sartal et al., 2020). Given our dataset with only three time periods (2011, 2013, and 2015), we prefer to follow panel-data analysis comparing the test results of OLS, Tung Nhu Nguyen 137 RE, and FE estimation. Among these techniques, FE estimator is consistent in a true fixed-effects model, while OLS and RE estimators are inconsistent (Greene, 2012). For consistency, we conduct postestimation diagnostic tests (Breusch-Pagan Lagrangian multiplier test and Hausman test) to to support the FE estimation. In addition to the FE estimation strategy, previous studies on labor productivity typically followed first-difference (FD) estimation, which assumes the serially uncorrelated first-differences (Sartal et al., 2020). The FD method is helpful in solving the unobservable heterogeneity across SMEs (variable omission problems) (Hsiao, 2014; Wooldridge, 2011). However, first-difference estimation is more relevant for datasets with large T (many individuals) and small N (few time periods). This paper does not proceed with the first-different estimation for our dataset with small T and large N. Another possible estimation method for datasets with many entities, few time periods but unbalanced pannels is system-GMM (Flannery & Hankins, 2013). This method helps resolve the endogeneity of explanatory variables through instrumental variables. However, the system-GMM estimation requires many lags of dependent and independent variables (Roodman, 2009). In the GMM method, different lags (e.g., many lags of labor productivity) are included in the estimation model. However, this method may generate an asymptotically inefficient estimator due to the lack of moment conditions implied by the error term (Wooldridge, 2011). Due to the limited number of lags, we cannot exploit deeper lags as instruments for the differenced lag of the model variables (i.e., lack of more than two lags of differenced labor productivity) as needed for the system-GMM method. Furthermore, unit-root and cointegration tests are SN Sector 2015 2013 2011 1 Food and beverages 7,963 6,560 3,233 2 Tobacco 12,820 11,334 7,630 3 Textiles 6,365 5,489 3,075 4 Apparel 6,585 4,701 2,824 5 Leather 5,127 4,550 2,632 6 Wood 4,937 3,926 2,277 7 Paper 6,468 5,204 4,469 8 Publishing and printing 6,347 5,737 4,660 9 Refined petroleum etc. 11,480 12,440 13,143 10 Chemical products etc. 9,239 8,561 5,345 11 Rubber 7,037 6,060 3,436 12 Nonmetallic mineral products 6,440 5,700 3,519 13 Basic metals 8,751 6,674 4,007 14 Fabricated metal products 7,328 6,324 3,857 15 Electronic machinery, computers, radio 7,465 6,133 3,731 16 Motor vehicles etc. 7,385 6,041 4,195 17 Other transport equipment 7,454 7,240 3,828 18 Furniture, jewelry, music equipment, wa 6,172 4,961 2,891 19 Recycling etc. 5,977 4,677 2,881 Source: Vietnam's General Statistics Office. Note: Oonly the data for manufacturing sectors displayed. Table 1. 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