Foreign investors who plan to set up long-term manufacturing operations in Vietnam will be attracted by an important indicator in Vietnam, a populous country with more than 90 million people. In the recent years, it would be recognized that Vietnam’s abundance of cheap labor seems to be competitive with China in the context of rising labor costs, and with Thailand in terms of political instability.
However, expert in Vietnam also consider that this edge should only be short-term indicator for a developing country like Vietnam. The bottom line here is competing by low wages will be risky and lead to the biggest challenge of ensuring labor force quality in long-terms.
As a result, under a government decree that takes effect January 1, 2015, Vietnam will raise the wage floor to VND2.15 million–VND3.1 million, depending on the location. The minimum wage will be VND3.1 million (146.2 USD) in Region 1, VND2.75 million (130 USD) in Region 2, VND2.4 million (115 USD) in Region 3 & VND2.15 million (101.4 USD) in Region 4.
