Society

Social insurance agencies paid sickness benefits due to Covid-19 to more than 1,453,700 beneficiaries in the first four months of 2022, totaling over VND1.9 trillion ($82.64 million). More than 85.3 million people are now covered by health insurance, or 87.44 per cent of the population. Over 13.4 million have unemployment insurance, or 26.57 per cent of the workforce.

In order to address the labor shortages seen in the opening months of 2022, Deputy Prime Minister Vu Duc Dam has assigned the Ministry of Labor, Invalids and Social Affairs to urgently submit to the government for promulgation a Decree stipulating regional minimum wages for employees working under labor contracts.

Businesses operating in Vietnam are paying foreign candidates very high salaries, from $8,500 to $34,000 a month. According to investors, Vietnam remains a destination of interest, where they can diversify production areas, reduce risks, and strengthen supply chains. The country’s labor market also boasts potential, with a skilled workforce and reasonable labor costs.

Despite the labor market showing signs of improvement, there was still a shortage of workers in certain regions in the first quarter of this year. It is expected that recruitment demand among enterprises will total nearly 1.3 million employees this year, an increase of 18 per cent compared to 2021 but still lower than in 2019 and 2020, when unskilled workers and workers not requiring a degree or certificate accounted for 75 per cent.

Eight associations have suggested the Prime Minister delay the timeframe for applying regional minimum wage increases, from July 1, 2022, as proposed by the National Wage Council, to January 1, 2023, to help businesses. The associations believe that raising wages in the middle of the year will put businesses in an extremely difficult situation, and many will have to cut staff, pause or reduce production, or even go bankrupt because they cannot pay the higher labor costs. This could lead to tens of thousands of workers losing their jobs.

Although the number of Covid-19 infections rose rapidly in most cities and provinces in Vietnam during the first quarter of 2022 due to the Omicron variant, the number of people employed in the period still increased compared to the previous quarter and the same period last year, especially in the services sector. However, Vietnam’s labor market still has some unsustainable elements, with unemployment and underemployment both remaining high.