While nearly two-thirds of Vietnam remains rural, urbanization has grown signficantly since the 1990s. Political reforms in the 1980s created greater economic stability in Vietnam in the decade that followed and led to higher urbanization. The growing population of Vietnam, as well as people migrating from rural areas, contributes to an escalating number of inhabitants in the country's already crowded cities.
Agricultural sector becoming less prominent
In 2008, nearly half the population of Vietnam worked in agriculture. Ten years later, as more people leave rural areas, the service sector is comparable in size, employing roughly a third of the population, while employment in the industry sector has grown to a quarter. Though agriculture has long had the most workers, the service and industry sectors accounted for larger shares of Vietnam’s GDP from 2007 to 2017.
Costs in rural and urban areas
In rural areas of Vietnam, investment in agriculture – such as the costs of farming – was the second-highest expense in 2019. In urban areas, around the same share was spent on aspirational living costs such as eating out and holidays, while investment was the category with the least amount of monthly spending. The expense associated with farming in rural areas is a possible cause for the increased migration to cities, with fewer people employed in the agricultural sector and more working in services such as health care, education, hospitality, and gastronomy.