Vietnam set to increase minimum wages in 2019

By Doan Loan   August 14, 2018 | 05:09 am PT
Vietnam set to increase minimum wages in 2019
Workers at a garment factory in Bac Giang Province, near Hanoi. Photo by Reuters
Vietnam’s National Wage Council has proposed a minimum wage increase of nearly $7-9 per month across all four levels in 2019.

Overall, the average increase across the four levels will be 5.3 percent.

All members of the National Wage Council (NWC) on Monday voted on the proposal to be submitted to the government.

Under the proposal, the minimum monthly wage across four levels will be raised, depending on the area, from $171 to $180 (region 1); $152 to $159 (region 2); $133 to $140 (region 3); and $118 to $125 (region 4).

At the same meeting, the Vietnam General Confederation of Labor (VGCL), proposed a minimum increase of 6.1 percent, while the Vietnam Chamber of Commerce and Industry, representing the business owners, proposed a 5.1 percent increase.

All sides came to an agreement of a 5.3 percent increase as the final rate so the meeting could move to the voting round.

Doan Mau Diep, deputy labor minister and chairman of NWC, said a 5.3 percent increase was reasonable and acceptable.

“As the inflation rate is not too high, labor productivity is rising and businesses are facing exchange rate risks, we think it is reasonable to increase the minimum wage between 5 and 5.5 percent.”

VGCL recently published a study on minimum wage and cost of living after surveying over 3,000 laborers in 150 different businesses in the country.

26.5 percent said they were “barely getting by,” while 12.5 percent said their incomes were not enough to support their families, and have to work overtime or extra jobs to make ends meet.

The study found that an average worker’s minimum spending is VND6.5 million ($290) each month, while the average base salary is just VND4.6 million.

Thus laborers need to work on average an extra 28 hours a month just to make ends meet, the study found.

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