Housing Affordability Trap and Labor Mobility: Evidence From Vietnam’s Urban Development

Housing affordability is becoming a major challenge in rapidly developing countries, including Vietnam. Rapidly rising housing prices while incomes have not kept pace make it difficult for many residents, especially low-income and migrant groups to access suitable housing. This limits labor mobility to better places of employment, negatively affecting the labor market and socio-economic development. However, the relationship between housing affordability and labor mobility in Vietnam still remains gaps. The study aims to clarify the impact of housing affordability on labor mobility in Vietnam, and further examine the impact of demographic and housing characteristics. The study is based on Kain's (1968) Spatial Mismatch theory and adopts the quantitative research method with data collected from 525 residents from urban areas across Vietnam. The results show that housing affordability is the factor that has the strongest and most positive influence on labor mobility, which means when housing expenditures account for a larger proportion of income, workers tend to move more to find better areas or job opportunities, at the same time, education level and housing type also have a positive influence while work tenure has a negative influence on labor mobility. The study highlights the need to improve housing affordability, especially for low-income groups and young labors, through policies supporting social housing and affordable rental housing to promote workforce mobility. Besides, it is necessary to focus on improving skills training to increase adaptability in the labor market and adjusting urban planning to reduce housing cost differences between regions.