Vietnam: Factories reducing working hours as orders drop
"Order plunge sees factories strive to retain workers", 13 November 2022
Factories aim to retain their employees by offering them early bonuses, food, and a possible salary increase.
For the last several months, nearly 1,000 staff at garment company D.G. in Thu Duc City have been working four days a week and resting the remaining three as foreign orders drop.
They work 12 hours a day, including four hours with 1.5 times salary.
The company has struggled to source materials, and sometimes buys from the black market at double the price, only to ensure its employees have work.
D.G. said it would raise employee salaries next month and give them their 13th month bonus.
Thanks to these efforts, the company has seen staff numbers remain stable for nearly six months.
It is among many factories in Vietnam doing all they can to retain workers amid declining orders, hoping to ensure a large enough workforce should the market recover.
Garment company PPJ Group, with 17,000 employees in 10 provinces, has been diversifying its products since the beginning of the year to ensure work for employees.
"When orders for one line of product declines, we focus on another line to to retain employees," deputy CEO Nguyen Thi Lien said...
Vinatex, which has 23 subsidiaries, has seen orders at many of its factories decline by 10-30% year-on-year, dragging down staff incomes.
Some subsidiaries are looking to new markets, or to increase product quality to meet new customer needs. Others are accepting low-profit orders or even losses to ensure jobs, said Vinatex deputy CEO Nguyen Thi Thuy.
"Factories are not prioritizing profits for now as long as operation is ensured."
In Binh Duong Province, known as Vietnam’s wood processing capital, many factories have seen orders plunge 30-50% since July.
Nguyen Liem said that in the second half this year many factories have had to shut down due to lack of orders...
Liem, who is the chairman of Lam Viet Woods, said the company earlier this year promised to give its employees a two-month-salary bonus, and has so far given them half as their income declined.
The company also regularly provides staff with food...
By the end of October, around 240,000 workers in Binh Duong have seen their work hours decline because of order shortage, said Dang Tan Dat, deputy head of the legal and policy committee under Binh Duong Labor Union.
Companies have allowed employees work four days a week and try to ensure their incomes do not decline substantially, he added.