Chairman of the Vietnam Chamber of Commerce and Industry Vu Tien Locspoke to Thoi Bao Kinh Te (Vietnam Economic Times) about plans toincrease the minimum wage in 2016.
* What do you think about minimum wage levels?
Theadjustment of minimum wage is very important to both employers andemployees, and plays an important role in the country's current economicgrowth.
Adjusting the minimum wage should be done if it canensure two factors are met: raising incomes and improving livingconditions for workers, as well as maintaining companies'competitiveness and sustainable development of the economy.
Strongwage increases dampen corporate competitiveness and economic growth;eventually labourers are the ones who take the hit. Small salary hikes,however, make life tough for employees, in turn affecting productivityand economic growth.
Annual salary adjustment is a difficult matter between businesses and workers, trying to find a level suitable for both.
* As a representative of employers, what increase will VCCI recommend at the National Salary Council meeting later this month?
In2015, the economy is thriving but productivity has not increased.Enterprises still face many difficulties. So I expect the increase willbe slightly over 10 percent next year.
Additionally, the Government has already approved a plan to increase the minimum wage by 15 percent for this year.
* Do you think labourers' minimum wage is still too low to sustain decent living conditions for workers?
Theminimum wage is still quite low and does not satisfy minimum livingconditions. I think next time the adjustment of minimum wage should bebased on three factors.
First, the increase needs to offset currency depreciation. The Government has managed to keep inflation at 5 percent.
Secondly,make sure that the salary hike is matches current productivity.Productivity increases about 3 percent per year on average.
Thirdly,we should be concerned about supplementing salaries to shorten the gapbetween the current salary levels and minimum acceptable livingconditions for workers.
The increase of minimum wage by 10 percent will satisfy the three factors above.
Inmy opinion, if the wage hike outpaces productivity, it will affect theoperations of businesses and eventually drag down economic growth.
* The problem seems to be that low productivity constrains the minimum wage. How can the tension be resolved?
Vietnamis one of a few countries in which labourers enjoy salaries higher thanthe productivity they generate, according to a report by theInternational Labour Organisation.
Thailand, Malaysia andIndonesia have national salaries lower than productivity. So, we shouldcarefully consider how much a salary rise could affect companies'competitiveness, encourage and promote domestic and foreign investment,and create more jobs. It would be make sense to improve productivity sothat a sustainable programme of salary hikes can as continue.-VNA
* What do you think about minimum wage levels?
Theadjustment of minimum wage is very important to both employers andemployees, and plays an important role in the country's current economicgrowth.
Adjusting the minimum wage should be done if it canensure two factors are met: raising incomes and improving livingconditions for workers, as well as maintaining companies'competitiveness and sustainable development of the economy.
Strongwage increases dampen corporate competitiveness and economic growth;eventually labourers are the ones who take the hit. Small salary hikes,however, make life tough for employees, in turn affecting productivityand economic growth.
Annual salary adjustment is a difficult matter between businesses and workers, trying to find a level suitable for both.
* As a representative of employers, what increase will VCCI recommend at the National Salary Council meeting later this month?
In2015, the economy is thriving but productivity has not increased.Enterprises still face many difficulties. So I expect the increase willbe slightly over 10 percent next year.
Additionally, the Government has already approved a plan to increase the minimum wage by 15 percent for this year.
* Do you think labourers' minimum wage is still too low to sustain decent living conditions for workers?
Theminimum wage is still quite low and does not satisfy minimum livingconditions. I think next time the adjustment of minimum wage should bebased on three factors.
First, the increase needs to offset currency depreciation. The Government has managed to keep inflation at 5 percent.
Secondly,make sure that the salary hike is matches current productivity.Productivity increases about 3 percent per year on average.
Thirdly,we should be concerned about supplementing salaries to shorten the gapbetween the current salary levels and minimum acceptable livingconditions for workers.
The increase of minimum wage by 10 percent will satisfy the three factors above.
Inmy opinion, if the wage hike outpaces productivity, it will affect theoperations of businesses and eventually drag down economic growth.
* The problem seems to be that low productivity constrains the minimum wage. How can the tension be resolved?
Vietnamis one of a few countries in which labourers enjoy salaries higher thanthe productivity they generate, according to a report by theInternational Labour Organisation.
Thailand, Malaysia andIndonesia have national salaries lower than productivity. So, we shouldcarefully consider how much a salary rise could affect companies'competitiveness, encourage and promote domestic and foreign investment,and create more jobs. It would be make sense to improve productivity sothat a sustainable programme of salary hikes can as continue.-VNA
