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High wages may prove to be nemesis for apparel exports
Jan '10
Ever since the recovery in the global economy began to unfold, the Vietnamese textile and apparel sector has been afflicted by a severe labour shortage as well as high labour costs, which is affecting production and also causing delays in shipping goods on time.

The Vietnamese textile and clothing industry is considered one of the most under-paid industry from amongst all industrial sectors, due to which workers are reluctant to work in the industry and prefer to work in more remunerative industries.

Apart from that during the initial days of the slowdown, a lot of skilled workers were retrenched, who either went back to their home-towns or re-located to other professions, in order to sustain their livelihood.

Since the second-half of 2009 and ever since the order position began to improve, the apparel manufacturing sector has been feeling a serious shortage of skilled workers as they were unwilling to join back the apparel sector, despite promises of higher wages.

But with wages now increasing, doubts are being raised whether the textile and apparel sector would be able to maintain its competitiveness in the face of challenges from low-cost countries like Bangladesh and Cambodia.

Experts from the industry aver that, since Vietnamese clothing manufacturers are more so in to producing high-value products, it would not be difficult to absorb the higher wages that are given to workers.

Fibre2fashion News Desk - India

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