Vietnam Labor Confederation eyes minimum wage hike of 5-6% next year

The Vietnam General Confederation of Labor, the head of all labor unions across the country, has proposed a 5-6% increase for the minimum regional wage next year.

Le Dinh Quang, vice head of the confederation’s labor relation department, made the statement at meeting of the National Wage Council on Wednesday. The event, chaired by Deputy Minister of Labor, Invalids, and Social Affairs Le Van Thanh, aimed to set a suitable wage hike for next year.

Quang clarified the increase would partly help laborers deal with inflation. A survey of the labor confederation showed that a hike of 11.34% would fulfill the minimum livelihoods for workers and their families, but in order to help businesses amid challenges, a lower rate has been suggested, he added.

The survey, featuring nearly 3,000 respondents, noted that 76.2% of workers voluntarily do overtime tasks to improve their incomes. With their average monthly income of VND7.8 million ($328), the core wages accounted for 76.7% while the remaining amount were sourced from bonuses, allowances, and overtime payments.

Additionally, 24.5% of workers said their incomes could fulfill their living demands, while only 8.1% said they were able to save money.

Concluding the event, Deputy Minister Le Van Thanh asked relevant sides to continue monitoring the situation and prepare for the next meeting in November to vote for the hike.

Vietnam’s most recent hike for the minimum regional wage was in July 2022. The rates are between VND3.25 million ($137) and VND4.68 million ($197) for four regions, equivalent to between VND15,600 ($0.66) and VND22,500 ($0.95) per hour.

The average monthly income of a worker in Vietnam was VND7 million ($297) in the second quarter of this year, down by VND79,000 ($3.36) or 1.14% versus Q1/2023, according to the General Statistics Office (GSO).

This figure was already above the minimum regional wage.

Vietnam’s workforce grew 1.35% year-on-year to 52.3 million in Q2/2023, including 27.67 million males and 24.65 million females. The proportion of trained workers was 26.8%, up 0.6 percentage points year-on-year.

Meanwhile, the country’s unemployment rate rose 0.05 percentage points from the Q1/2023 to reach 2.3% in Q2/2023, or over 1.07 million people, the GSO reported.