A Vietnamese factory worker. Photo by iStock.
A Vietnamese factory worker. Photo by iStock.

The National Wage Council (NWC) of Vietnam has decided to raise the minimum wage rate by 5.3%, starting from January 1 next year.

Members of the NWC voted on Monday on a proposal that will be submitted to the government. Initially, the Vietnam General Confederation of Labor (VGCL) proposed an increase of 6.1%, while the Vietnam Chamber of Commerce & Industry countered with 5.1%.

The two sides agreed on 5.3% the following day, which translates to a hike of US$7 to US$9 per month, VN Express reported.

“Labor productivity is going up and the inflation rate is not that high, therefore we believe a rate between 5% and 5.5% is acceptable,” said NWC chairman Doan Mau Diep, who is also deputy labor minister.

In July, consumer price inflation in Vietnam grew 4.46% from a year ago, compared with a year-on-year growth of 4.67 % in June, statistics showed.

The proposal is set to be signed off by Prime Minister Nguyen Xuan Phuc in November and will be implemented in January. All four minimum wage regions in Vietnam will have their minimum wage levels increased. In 2018, the minimum wages increased 6.5% from last year, ranging from VND 2.60 million (US$116) to VND 3.75 million (US$166).

In a recently published study conducted by the VGCL, 26.5% of more than 3,000 laborers told a survey they were “barely getting by.” About 12.5% of respondents said their incomes were insufficient to support their families. The study said laborers had to work an additional 28 hours per month to make ends meet.