Vietnam Hikes Minimum Wages By 5.3% In 2019


Vietnam’s National Wage Council has increased the minimum wage by an average of 5.3% in 2019. The hike, which is the lowest compared to previous years, will increase the minimum wage in the four regions by US$ 7-9 per month. In 2018, the increase was 6.5%, while in 2017 the minimum wage was hiked by 7.3%.

Representing the employees, the Vietnam General Confederation of Labor (VGCL) proposed an increase of at least 6.1%, while the Vietnam Chamber of Commerce and Industry (VCCI) which represents the employers, proposed an increase of 5.1%. After discussions with the National Wage Council, all parties agreed on 5.3%.

Minimum wage increase
In 2018, minimum wages ranged from VND 2.76 million (US$ 118) to VND 3.98 million (US$ 171). In 2019, the new minimum wages will range from VND 2.92 million (US$ 126) to VND 4.18 million (US$ 180).

Cost of living
According to a survey, an average worker’s minimum monthly spending is VND 6.5 million (US$ 280), while the average base salary is only around VND 4.6 million (US$ 197.8), which forces labourers to work overtime.

In 2017, consumer prices increased by 3.53%, while in 2018, it increased by 3.54%. As there is a strong correlation between inflation and wages, the rise in inflation will impact wage growth.

The 5.3% hike in 2019 minimum wages which is just slightly higher than the rise in consumer prices in 2018, will compel the government to increase the minimum wages by a much higher rate in 2020 to maintain the purchasing power.


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