Vietnam to sharply increase public-sector minimum wage

Deutsche Presse Agentur
Published: Tuesday September 12, 2006

Hanoi- Vietnam is raising the minimum wage for government employees by 27 per cent, state-run media reported Tuesday. As a result, public-sector employees, including those at state-run industries, will see their minimum monthly salaries increase to 28 dollars, up from 22. In addition, those who are living on government pensions will see their benefits rise by 28.6 per cent.

A pay increase was expected, but it was slightly higher than originally proposed. The new salary rates were set to take effect October 1.

According to the Vietnam News Agency, at least 11 million people are to be affected by the new rates.

This is the third such pay raise in Vietnam in the past five years. The increases were largely in response to rising fuel prices and Vietnam's 8.3-per-cent inflation rate, but it is also part of the government's effort to keep pace with what the private sector is paying.

Earlier this year, Vietnam was hit by a series of strikes by workers employed in foreign-owned clothing and shoe factories. As a result of wage negotiations, monthly salaries were raised to 55 dollars for private-sector factory workers living in Vietnam's largest cities.

Pham Minh Huan - head of the Wage Department of the Ministry of Labour, War Invalids and Social Affairs - said the government plans to have a single minimum wage that applies to all sectors by 2010.

© 2006 DPA - Deutsche Presse-Agenteur