This study investigates the perceptions of higher education students, recent graduates and employers in Vietnam on the issue of skill development in the higher education system in Vietnam. Enhancing skill development is considered essential for students, not only to pursue their study, but also for their success later, at work and in life. The results suggest that though there is evidence of effort to change, to include and to develop soft skills in the system, the central-controlled curriculum, the traditional teaching method, the prevalence of passiveness among students and cultural features all hinder the effort of developing skills for university students. The limitation in skill development during university is considered one of the biggest barriers preventing university graduates from making a smooth transition to the workplace.