Downsized laborers not ready to take new jobs

Shortly after Taiwanese shoemaker Ty Hung Co. laid off 1,185 workers at its HCMC factory in November due to falling orders, Thuan Phuong Embroideries Garments Co. reached out to those workers and offered them new jobs at its factory.

Thuan Phuong, located in HCMC, was in need of 100 workers, and announced that it would accept applications until February 2022. The company promised to train unskilled workers and offered them a monthly salary of VND7-15 million ($290-625).

Staff from Thuan Phuong visited Ty Hung Co. and the worker dormitory to recruit staff, but the garment firm has yet to receive any applications.

“No one applied for a job,” said Bui Van Duy, a human resources officer at Thuan Phuong.

Workers at Ty Hung Co. Ltd in Ho Chi Minh City’s Binh Tan District leave their factory after a working day in November, 2022. Photo by VnExpress/Le Tuyet

The district’s Department of Labor, Invalids and Social Affairs then contacted other factories in the area to see if they had a need for workers and to help those that had just lost their jobs.

“Though many of the workers applied, only a few came to take new jobs at companies we have recommended,” said Tran Thanh Tho, an official at the department.

Shin Dong Garment Co. said as many as 300 workers applied for jobs, and that most passed the interview, but so far, only nine have come to work. South Korean garment firm Wooyang Vina 2 Co. told the same story, saying that 180 workers showed up for the interview, but that just five agreed to accept a job.

Tho said there are two reasons why workers that have been laid off recently do not want to take new jobs around this time of the year.

First, when losing their jobs at a company, laborers will receive at least three months of severance pay. Second, as it is just more than one month until the Lunar New Year, if workers decide to take a new job now, their Tet bonus for the following year will be negligible and they will have to abide by the Tet holiday schedule as decided by the new employers.

Therefore, most laborers will opt for seasonal jobs at this time of the year and will wait until after the Tet holiday is over to start working again, said Tho.

Bui Van Duy, a human resources officer at Thuan Phuong Embroideries Garments Co.shared the same observation.

Duy said through many interviews he has found that many workers now only want to take seasonal jobs and wait until being unemployed for one year so that they could make the one-time withdrawal of their social insurance.

In Vietnam, workers with labor contracts of at least a year will be subject to compulsory social insurance payments. Their employers will extract their monthly salaries to pay the social insurance.As per existing law, contracted laborers must pay social insurance for 20 years to get a pension when they retire. However, they have the right to withdraw all of it as long as they can prove they have been unemployed for at least one year. Such a withdrawal means they will have nothing left in the future for their retirement pension.