Gloomy job market makes year-end layoffs dire

By Minh Tam, Pham Nga   November 27, 2022 | 03:30 pm PT
Nguyen Thu Huong is upset and worried after her second layoff from a job in a month and does not know where to apply next.

The 25-year-old worked at a garment factory for three years before being fired a month ago because the company lacked orders and work for all its workers.

Since she is single and lives with her parents in Thanh Hoa Province, the three-month severance allowance she got is enough for her to stay afloat between now and Lunar New Year (Tet). However, her parents are concerned.

She says: "Before Tet, instead of asking me, 'How much did you save?' like in previous years, my parents are now asking me, ‘Have you found a job?'

"This is even scarier."

She made a round of companies and industrial parks as soon as she lost her first job to find a new one.

After two weeks she managed to land a job similar to her previous one at a factory only 15 km away from home. Since she had three years of experience, she did not need to be trained again.

But after just a week the factory ran out of orders and had to lay off workers, and newcomers like Huong were the first to go.

If she cannot find a job by Tet: "My parents will ask me the same question until I got a headache.

"I'm willing to work as a seasonal worker or even a waitress if I can't get a full-time job."

Ly Thi Thal cooks instant noodle in her rented room in HCMCs District 12 on November 21, 2022. Photo by VnExpress/Minh Tam

Ly Thi Thal cooks in her rented room in HCMC's District 12 on November 21,2022. Photo by VnExpress/Minh Tam

Ly Thi Thal, 32, of Soc Trang Province, who used to work at a garment factory in HCMC's District 12, is also disappointed and jobless like Huong.

Last year, even when the Covid-19 outbreak hit HCMC hard and posed severe challenges, her company managed to remain afloat. But when things returned to normal, the company lacked orders and she lost her job at the end of October.

On November 21, instead of heading for work as she had done for the last five years, Thal walked to factories near her boarding house to look for work.

Her eyes would light up whenever she saw a sign at the entrance, but would be disappointed at finding out it did not announce vacancies.

She has been seeking for a job for almost a month now, but no one is hiring.

Her husband works in Long An Province as a construction worker, and his income is only enough for him.

The couple have two kids going to school in the countryside.

When she had her job she was paid VND6 million ($241.57) a month plus VND2 million for overtime.

"I would send VND2 million to my kids and VND1 million to my parents, spend VND3 million for my room and food and save the rest," she says as she picks up a boiled corn cob to eat.

When she lost her job, she did not know where to look for another one. For the first few days she ate vegetables and rice, and then switched to instant noodles or boiled corn.

She is afraid that if she is unemployed for a long time, she will not have money to pay her kids’ school. Besides, she wants them to have new clothes and food on the table for Tet, which is around the corner.

"I cried for two nights. I haven't been able to muster the courage to call my parents and tell them."

Because she does not know how to ride a motorbike, she has been going around on foot every day for the past week looking for a job.

Thal and Huong are just two of the hundreds of thousands of workers, mostly in textiles, footwear and woodworking, who have lost their jobs in the last few months because of lack of orders from Vietnam's main export markets.

Between September and November more than 631,300 workers in 28 localities, mostly in the south, were affected, according to the Vietnam General Confederation of Labor.

Nearly 570,000 had their working hours cut, 34,500 people lost their jobs and 31,000 were furloughed.

Tran Viet Anh, vice chairman of the HCMC Union of Business Associations, says many industries are seeing a decline in in production and exports and only those that make essential goods like food and household appliances have steady orders and are retaining workers.

Industries like furniture, clothing, leather, and footwear are faced with falling demand, while the electronics industry sorely lacks raw materials.

According to data from the Vietnam Leather, Footwear and Handbag Association, companies' orders are likely to fall by 30% in the fourth quarter and exports have declined since the beginning of September.

In October more than 10,440 people applied for unemployment benefits, according to the HCMC Employment Service Center.

The number of jobless people eligible for support in the last 10 months rose by 26% year-on-year to 128,000, it says.

Workers sign up for unemployment support at the HCMC Employment Service Center. Photo by VnExpress/An Phuong

Workers sign up for unemployment support at the HCMC Employment Service Center. Photo by VnExpress/An Phuong

Assoc Prof Nguyen Duc Loc, director of the Social Life Research Institute, said losing their job is the most stressful thing for factory workers because they are not qualified to switch to high-skill jobs and do not usually have many friends because they work long hours due to the nature of their job.

For a long time businesses built their growth models around the idea of specialization, and a worker only needed to do one single job in the production line.

According to a survey by Social Life, 53.4% of employees said their current jobs did not require any qualification at the time of applying.

Only 10.4% of workers have a high school diploma or higher. Those with an intermediate education, college or higher education account for 5.2%. Those with vocational skills or certificates make up 8.6%.

People under 35 with good health make up 10.3%. When they are hired, they only need a few training sessions to be able to start working on their own.

But they cannot find a new job when they lose their old one since they only know one tiny part of making a product. Few of them build social connections since they more or less focus solely on working to improve their income.

Loc says after this wave of layoffs, businesses will likely restructure in a way that makes them more efficient with fewer people, opting for more skilled, educated and qualified workers or healthy young people during the hiring process.

In addition, they will try to find seasonal workers through third parties so that they do not have to pay full-time salaries and social insurance, he says.

On November 22 a neighbor referred Thal to a seasonal job after seeing her walk around aimlessly for several days without managing to get a job.

"I hope I'll land this job since Tet is just two months away and I have to take care of my children," she says.

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