Worker protection required after spate of lay-offs persists

According to statistics of the Ministry of Labour, Invalids and Social Affairs, as of mid-December about 600,000 employees, accounting for about 4 per cent of the total number of employees working in enterprises in Vietnam, were underemployed while more than 50,000 workers had lost their jobs, accounting for 8.4 per cent of the affected employees.

Lunar New Year fairs are being organised in various localities to support workers during the festive period, photo Duc Thanh

The uncertainties in the job market pose a problem that needs to be quickly solved for management agencies, especially with Lunar New Year approaching.

Vice chairman of the Vietnam General Confederation of Labour (VGCL) Ngo Duy Hieu said that if job losses and lay-offs continue for a long time, it will threaten social stability. Therefore, in addition to short-term support policies such as allowances for workers to temporarily overcome a difficult period, it is necessary to move towards more sustainable solutions such as supporting workers to find new jobs, providing vocational training, and helping businesses to maintain operations.

“Nurturing labour resources must go hand-in-hand with business development. If a business stops operating, it will not only affect the business itself but also the employees. We will propose solutions to the government on how to remove difficulties for businesses and employees,” Hieu said.

The VGCL will organise 22 Lunar New Year fairs in localities with discounted prices for employees. It is also expected to have an additional support package for workers during and after the festive season.

Meanwhile, Hanoi has the most industrial zones (IZs) and economic and export processing zones (EPZs) in the north. However, its stability has been under threat since the beginning of the month.

Nguyen Dinh Thang, vice chairman of the Hanoi Industrial and Export Processing Zones Trade Union, said that most workers in IZs in the capital are experiencing a decrease in income because overtime hours have been cut. This rarely happens at the end of the year, which is usually when businesses ask employees to work overtime to keep up with the high production schedule. “The income of workers in IZs is now lower than during the pandemic peak. The heavy decline in income has seen many workers move back to their hometowns,” Thang said.

Hanoi currently has nine IZs and EPZs with more than 165,000 workers. Even during the height of the pandemic, they did not record a mass reduction of workers like some other areas. But currently, workers are willing to quit their jobs because their income is not enough to maintain their lives in the city.

According to the Hanoi Employment Service Centre, the city currently has more than 2,000 workers whose jobs have been under threat since November, mainly in the electronics and component manufacturing industry, and there have been businesses in IZs that have cut hundreds of workers already.

“This is because European and American markets are cutting spending due to inflation, causing domestic enterprises with export orders to be reduced, which means businesses have to reduce labour,” said Vu Trung Thanh, deputy director of the centre.

The trade unions of such zones in Hanoi proposed the government continue implementing policies such as tax reduction, tax extension, preferential interest rates, and loans to help businesses maintain business operations and support training to improve vocational skills for employees.

Not only in Hanoi, many workers in other IZs in Vietnam are facing the risk of unemployment.

In Binh Duong, the province with the largest concentration of IZs in the south, more than 240,000 people have had their working hours reduced and about 30,000 people have had contracts suspended this month alone, according to Binh Duong Labour Confederation. Dang Tan Dat, head of the confederation’s Policy and Legal Affairs department, said that workers whose contracts are suspended may not be paid for the next 3-4 months and in 2023, the number of workers suspended may increase due to disruptions in supply chains. “Supporting policies are necessary in the short term, but long term, there is still a need for solutions to ensure jobs and incomes for them,” Dat said.

Some businesses in the province have proposed the government offer support packages similar to those applied during the pandemic, including delaying social insurance and union fees, reducing personal and corporate income tax, and banks extending loans for businesses.

According to Dong Nai Labour Confederation, nearly 230 businesses have reduced working hours, causing more than 62,700 employees to be affected and about 22,600 employees to have contracts suspended in the last six months, mainly in textiles, furniture, and wood processing.

According to a report by Ho Chi Minh City Confederation of Labour, 108,000 workers in the city have lost their jobs or are working fewer hours in the second half of 2022.

Tran Thi Lan Anh, general secretary of the Vietnam Chamber of Commerce and Industry, admitted that, in addition to the decline in orders, there was still a shortage of local workers in some industries such as manufacturing and services. Ho Chi Minh City needs to recruit around 25,000 workers, Hanoi requires 28,000, Bac Ninh is looking for 20,000, and Dong Nai needs around 12,500 workers.

Lan Anh suggested, “Vietnam needs to continue to improve and implement support policies for employees and employers, especially small- and medium-sized enterprises with support packages in terms of fiscal policy, credit support policy, and social security.”

Policies to support retraining, connection and regulation of labour also contribute to building a stable job market, helping workers to be more proactive when looking for a job. “Especially, the welfare regime must be well implemented because this is a critical solution to improve the quality of the enterprise’s human resources, contributing to the sustainable development of the enterprise,” she said.

Unemployment insurance fund to soon complete payments for COVID-19-hit employees More than 339,000 employees affected by the COVID-19 pandemic have received a total of 963 billion VND (41.12 million USD) from the unemployment insurance fund as of 5:30 pm on August 25.

Ensuring employment security and skills development in digital age Policymakers, businesses, and experts gathered at a workshop on November 8 to discuss major labour market trends in Vietnam, with digital skills for workers and employment issues being the main focus.