Increase regional minimum wage in 2024

Is a 6% regional minimum wage increase in 2024 reasonable?

This morning (December 20) the Wage Council consists of 3 parties: Representatives of the Vietnam General Confederation of Labor; Vietnam Confederation of Commerce and Industry (VCCI); and the Ministry of Labor, Invalids and Social Affairs held a salary council meeting to discuss plans to increase the regional minimum wage in 2024.

After 5 hours of continuous discussion, the Wage Council finalized the plan to increase the regional minimum wage by 6%. The specific increase is from 200-280 thousand VND/month, depending on the region.

Specifically, region I, increased to 4,960 thousand VND (up 280 thousand VND); Region II, increased to 4,410 thousand VND (up 250 thousand VND); Region II increased to 3,860 thousand VND (an increase of 220 thousand VND); Region IV increased to 3,450 thousand VND (an increase of 200 thousand VND).

Similarly, the hourly regional minimum wage also increased. Specifically: Region I increased by 4,680; Region II is 4,160 VND; Region III is 3,640 VND; Region IV is 3,250 VND.

The representative of the salary council said that according to this plan, the regional minimum wage will be 2% higher than the regional minimum living standard until the end of 2024 to improve wages for workers. On the other hand, ensure a sufficient minimum living standard by mid-2025 (Pre-calculate part of the CPI of 2025) into the minimum living standard for workers to enjoy right from mid-2024).

Workers are excited about their salary increase

Hearing that in 2024 there will be a salary increase, Luong Thi Nga (42 years old), a worker at the Garment Company in Ha Dong (Hanoi), is very happy. Ms. Nga said that as Tet approaches, workers are even more thirsty for a salary increase. Since half a year ago, Ms. Nga’s salary has been sharply reduced. Previously, with overtime, her salary was about 12 million VND, but since the company reduced her salary order to just over 7 million VND/month.

“My husband and I’s salary has not increased but decreased. We have a family of 4 and our income is only 17 million VND, so life is very difficult. We just hope the salary will increase soon, the company will have less difficulties, and the workers will be able to work overtime to earn more income. Worried about life, I can’t survive like this,” Ms. Nga said.

The new minimum wage meets about 1/4 of her family’s minimum living needs. Therefore, when she heard the news of the salary increase, she was very happy.

Low wages and unstable lives make many workers intend to return to their hometowns to work and live instead of in urban areas. Understand this problem, but in reality, companies are also facing very difficult times. Orders decreased, the company had to try very hard to retain workers.

A recent survey (November 2024) of the Institute of Workers and trade unions conducted on 3,100 workers in many occupations in 10 provinces and cities showed that 21.4% of workers said the current minimum wage was of previous years is insignificant compared to the rate of price slide; 26.8% think that the minimum wage is too low, does not reflect the actual payment level of the labor market and 10.1% think that the current salary does not create motivation for workers to strive. .

Notably, a survey by the Vietnam General Confederation of Labor (Confederation of Labor) also shows that the current minimum wage only meets 1/3 or 1/4 of a worker’s family’s expenses; 75.5% of respondents said their current income does not meet their spending needs, with the lowest only meeting 45% of their spending needs; 52.3% of workers have to work overtime to earn more income to improve their lives.

On the sidelines of the meeting to discuss plans to increase the regional minimum wage this morning (December 20) of the National Wage Council, Mr. Ngo Duy Hieu – Vice Chairman of the Vietnam General Confederation of Labor (LDLDVN), Vice Chairman of the Council National Wage said that at this meeting, the representative of workers proposed to increase the regional minimum wage from 6.5% – 7.3%, with the salary increase starting from July 1, 2024. However, the salary council after consideration and chose a 6% increase. Mr. Hieu said that employee representatives are satisfied with this increase, which ensures sharing with employers in difficult circumstances.

“This is an appropriate increase based on the economic and social situation, considering many aspects, including shared responsibilities with employers. In the context of salaries of civil servants, public employees, and the force Armament will increase from July 1 next year, adjusting wages for workers like this is appropriate,” said Mr. Ngo Duy Hieu.

On the employer side, Mr. Hoang Quang Phong – Vice Chairman of the Vietnam Confederation of Commerce and Industry (VCCI), Vice Chairman of the National Wage Council also agreed with the increase in the regional minimum wage. Mr. Phong believes that the 6% increase is consistent with reality.

“There are still many businesses dissolved from the market. Besides the goal of keeping jobs, businesses must also consider adjusting benefits for employees, based on the business’s endurance and paying capacity. Although Although the situation is very difficult, salaries cannot be adjusted and a 6% increase is appropriate,” Mr. Phong said.

According to labor experts, wages and increasing the regional minimum wage are just one of the solutions to improve living conditions for workers. In addition to increasing the minimum wage, the government can consider solutions to directly and indirectly support workers. For example: Enhance vocational skills; increase support and subsidies…