Garment and footwear companies fear labor shortage after Tet

The fear that workers may not return to work after Tet has caused worries to the enterprises in labor-intensive sectors, especially garment and footwear companies.

Nguyen Thi Tong, Deputy Secretary General of the Vietnam Leather and Footwear Association Lefaso, said that big footwear enterprises, which make up 70 percent of the total export turnover of the whole industry, are mostly located in the south, of which 40 percent are in HCM City, 25 percent in Binh Duong and 11 percent in Dong Nai.

In the localities, according to Tong, though the Tet holiday will only come in one week, there are already big changes in the labor force. Therefore, enterprises all anticipate serious shortage of labor after Tet. This will be especially problematic as they need to fulfill export orders.

According to Ha Duy Hung, Director of Dong Hung Footwear Company in Binh Duong province, Dong Hung now has more than 3000 workers and the company has signed the export contracts for until mid 2011. However, the board of management fears that many workers will not return after Tet. If so, the company will have to recruit new workers, and it will take the company time and money to train them, which will certainly affect the productivity.

Meanwhile, Nguyen Tung Van, Chair of the Trade Union of the Vietnam’s textile and garment industry, said that there are many reasons that make workers not return to work after the Tet holiday. In the context of the high inflation, the living expenses are getting more expensive in big cities, so many workers choose to take jobs in their home villages, even if this means lower income.

Meanwhile, with increasing prices of the input material , not all enterprises can arrange accommodations and increase salaries for workers.

Labor shortage is obviously the biggest challenge for labor-intensive industries, such as garment and footwear. The labor shortage, according to experts, has led to the 10-15 percent decrease in the production.

In 2010, the salary of garment workers was 3-4 million dong a month in big cities and 1.7-3 million dong in other localities. In order to retain workers, enterprises have to increase the salaries by 10-20 percent and pay for lunches, but the problem of labor shortage has not been solved.

In order to improve their worker’s situation and persuade them to return to work after Tet, some big garment companies, such as Nha Be Garment and Viet Tien not only give big Tet bonuses, but also prop up transport fee for workers when they travel back to their home villages.

In related news, the report on employment trends in 2011 shows changes in the structure of the labor market, namely the transfer of the labur from low-productivity and labor-intensive agriculture to the industrial and service sectors with higher added value.

The report, which was released on January 24, showed that Vietnam has obtained the goals of creating sustainable employment, an important factor to eliminate / reducehunger and poverty.

The percentage of unstable jobs has dropped to 4.3 percent thanks to the increased proportion of regular employees (2.9 percent) and self-employed workers.

As a country, Vietnam has a relatively high proportion of employed population (75 percent of the population aged 15 and higher)

Most people are work inin agriculture, forestry and fisheries (23 million). However, all reports predict that the number of agricultural jobs would decrease to 21.1 million by 2020. – Vietnamnet

Tags: Vietnam garment exports, Vietnam Garment industry