Unemployment levels expected to rise sharply

25 Dec '08

2 min read

Vietnam was riding on a high wave of growth in the textile and garment industry till the first half of the year. But with the unfolding of the economic crisis and the resultant slowdown, growth rates are heading southwards. This is also resulting in shutdowns leading to unemployment's.

The shutdowns are more noticeable in foreign invested companies, rather than those managed by domestic companies. The Director of Dong Nai Province's Department of Labour, War Invalids and Social Affairs, Le Thi My Phuong has gone on record to say that the province has lost 3,000 jobs till date mainly in textiles, garments and footwear sector.

For every one percent growth in GDP, 0.33 percent of the workforce gets new jobs. Considering that GDP of Vietnam has slipped from 8.5 percent in 2007 to 6.5 percent in 2008, it means a loss of 2 percent GDP which will directly affect 0.66 percent of the workforce or about 300,000 workers.

The ministry of Labour has sent a proposal to the government seeking an additional VND 500-600 billion for the national target programme on employment to increase investment opportunities and thereby generate more jobs. The ministry has also asked provinces to send a status report on joblessness in their provinces.

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