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Vietnam's garment sector accounts for the country's largest workforce, but many of its employees are forced to work hard to fill the pockets of rich shareholders, Oxfam has said in a new report on the global inequality crisis.
In Vietnam, as well as Indonesia, Kenya and Morocco, wages have failed to keep pace with increased productivity and economic growth, and profits are often returned to wealthy shareholders, leaving workers to suffer a “relentless squeeze,” Oxfam said.
The organization used the garment sector in Vietnam as an example of inequality in the global economy, which is serving the rich and powerful and not the ordinary working people.
According to Oxfam, the minimum wage in Vietnam is currently not enough for people to escape poverty.
To increase the salaries of all 2.5 million Vietnamese garment workers to a living wage, employers would have to spend $2.2 billion a year, which is equivalent to just a third of the amount paid to shareholders by the top five companies in the sector.
The year 2017 saw the biggest increase in billionaires in the world’s history, with one more every two days. Billionaires saw their wealth increase by $762 billion in 12 months, an amount which could have ended extreme global poverty seven times over, said Oxfam.
As much as 82 percent of all wealth created in the last year went to the top one percent, while the bottom 50 percent saw no increase, it said.
“Poorly paid work for the many is supporting extreme wealth for the few,” it said. “Women are in the worst work, and almost all the super-rich are men.”
A garment worker from Vietnam, only identified as Lan, has been stuck between long hours and low pay, and has been unable to go home to see her son for nine months, Oxfam said.
Lan, 32, works in a garment company in the southern province of Dong Nai, 30 hours south of her home in Thanh Hoa.
She works six days a week for at least nine hours a day, sewing together the heels and soles of shoes for around $1 per hour. Every day, she works on 1,200 pairs of shoes for multiple global brands.
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Lan, 32, on a bus to visit her family in Thanh Hoa Province for the first time in nine months. Photo courtesy of Oxfam |
When she became pregnant a year ago, she was put to work in a warehouse stamping shoe boxes.
She remembers thinking that her son would like a pair of the shoes, but she would never be able to afford them.
“These shoes would fit my son perfectly, they are very nice,” she said. “I’d like my son to have shoes like these, but he can’t.”
“You known that one pair of shoes that we make is valued more than our whole month’s salary,” she said.
To make Lan’s dream of a pair of shoes more feasible, Oxfam said Vietnam and other governments need to end inequality.
Governments should make sure the income of the top 10 percent is no more than the income of the bottom 40 percent, and executives should earn no more than 20 times their median employees’ pay.
All multinational corporations must ensure workers are paid a living wage, it said.
Vietnam’s minimum wage now ranges between VND2.58 million and VND3.75 million ($113-165) per month, depending on region. The government has approved a 6.5 percent wage increase for later this year.
The minimum wage is used by businesses to calculate salaries for workers by multiplying the base level by a coefficient assigned to each worker, based on their skills and experience. But a study by the International Labor Organization, published in August 2016, found workers in the garment sector actually earned 6.6 percent less than the minimum rate in 2013.
Vietnam’s Institute of Workers and Trade Unions questioned 2,600 workers in March 2017, and a third of them said their incomes were low and barely sufficient to live on, while 12 percent said their wages simply did not cover living expenses, forcing them to work extra hours.
