Impacts of minimum wage in Viet Nam

In Viet Nam, the issue of low wages continues to affect many workers. While average nominal wages have grown in recent years, real wages remain low once inflation is taken into account, underscoring the importance of minimum wage in protecting workers’ living standards.

In response to this challenge and a National Wage Council request, the International Labour Organization took the lead in conducting this research report to assess the wide-ranging impacts and effectiveness of national statutory minimum wage rates since their establishment based on a tripartite social dialogue in 2013.

This study employed a mixed-methods approach, combining quantitative analysis of Labour Force Surveys and the Viet Nam Enterprise Census with qualitative interviews with workers, employers, and worker representatives.

The findings reveal that:

• While Viet Nam has a relatively low rate of workers earning below the minimum wage, certain groups – such as female, older, and less-educated workers – remain vulnerable.
• Compliance also varies across sectors and regions, with household employed workers facing the highest risks.
• Minimum wage adjustments have not significantly affected employment levels or firm performance, but they do influence labour costs, competitiveness, and workers’ access to social insurance.

The report presents key policy recommendations:

• Establishment of a transparent and predictable roadmap for minimum wage adjustments.
• Stronger inflation control to ensure real income gains.
• Integration of minimum wage policy with broader socio-economic measures.
• Enhancement of collective bargaining mechanisms.

This report has been published under the project “Setting Adequate Wages” project, a technical cooperation initiative with support from the Ministry of Foreign Affairs of the Netherlands.