Is Vietnam's 탈중국 Benefit Over?…13% Increase in Unemployed in Q1

Decrease in Manufacturing Orders... 290,000 Laid Off Due to Business Difficulties

The number of unemployed people in Vietnam, which was expected to benefit from global companies' shift away from China, surged in the first quarter. This is analyzed to be due to companies restructuring as manufacturing orders declined.

According to the General Statistics Office of Vietnam (GSO) on the 9th, the number of unemployed people in Vietnam in the first quarter of this year was about 149,000. The GSO stated, "This is more than a 13% increase compared to the same period last year."

The GSO analyzed that the increase in unemployment appears to be due to a decrease in manufacturing orders.

The number of workers temporarily laid off due to management difficulties in the first quarter was counted at 294,000. Among them, 83.8% belonged to foreign-invested footwear, apparel, and wood processing companies.

By region, Dong Nai Province (32,600 people) and Binh Duong Province (21,700 people) in the Southeast industrial zone, as well as Bac Ninh Province (14,000 people) and Bac Giang Province (7,700 people) in the north, were identified as the areas with the highest number of unemployed people.

A citizen in Hanoi is looking at a job advertisement board. [Image source=Captured from VN Express website]

In particular, the average unemployment rate in the southern Mekong River basin, where many manufacturers are concentrated, rose by 0.25 percentage points year-on-year to 1.75%, and the number of employed people in Bac Giang and Bac Ninh decreased by 4.5% and 0.9%, respectively.

In Ho Chi Minh City, Vietnam's largest city, the average monthly labor income was 9.1 million dong (about 510,000 KRW), down 1.4%, and in Binh Phuoc Province, it was 6.8 million dong (about 380,000 KRW), down 2.8%.

The GSO pointed out, "Government-level support for the garment, footwear, and electrical product sectors facing management difficulties, as well as vocational training for the unemployed, are necessary."

Meanwhile, Vietnam's first-quarter gross domestic product (GDP), announced by the GSO on the 29th of last month, grew by 3.32% year-on-year. This is the lowest level in the past 13 years, along with 3.21% in the first quarter of 2020, which was the lowest due to lockdowns in major cities during the COVID-19 pandemic.

Experts believe that Vietnam has officially entered the influence zone of the global economic recession. If this continues, there is also an analysis that Vietnam may remain at its lowest growth rate ever.

This content was produced with the assistance of AI translation services.