75 pct of firms plan pay cuts if Covid-19 crisis lingers
75 pct of firms plan pay cuts if Covid-19 crisis lingers
A survey has found 75 percent of companies in Vietnam planning pay cuts if the Covid-19 pandemic continued to hurt business.
Workers manufacture antibacterial masks at a firm in Saigon's Tan Binh District, April 2020. Photo by VnExpress/Nguyet Nhi.
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Only 25 percent said they would not cut staff’s wages despite the business situation deteriorating.
The survey of 172 enterprises in Vietnam conducted by jobs company Talentnet from late March to early April found that businesses in each industry planning different levels of wage cuts.
The consumer goods sector would cut wages of their staff by less than 10 percent while the manufacturing and hi-tech sectors plan cuts of 20 to 30 percent.
For employees that are temporarily out of work due to the Covid-19 crisis, 54 percent of surveyed firms said they chose to pay salaries based on mutual agreements but would be not lower than the regional minimum wage level.
The survey also found 52 percent of surveyed firms forecast their revenues would fall sharpy this year due to the impacts of the Covid-19 crisis while 27 percent said they have yet to draw their estimates.
The Covid-19 pandemic has cost nearly five million Vietnamese workers their jobs as of mid-April, bringing Q1 employment figures to a 10-year low, according to the General Statistics Office (GSO).
Vietnam recorded a GDP growth of 3.82 percent in Q1, its lowest in a decade. As many as 18,600 companies temporarily suspended business in Q1, up 26 percent year-on-year.
Meanwhile, a report by the International Labor Organization has said up to 10.3 million workers in the country could be impacted by the Covid-19 pandemic, losing jobs or seeing their incomes decline in the second quarter.
