Increasing regional minimum wages: Improving workers' lives

According to the proposal of the Ministry of Home Affairs, the minimum wage from January 1, 2026 is expected to increase by 250,000 - 350,000 VND compared to the current minimum wage depending on the region. According to the Ministry of Home Affairs, increasing the regional minimum wage for workers is necessary.

Urgent salary increase

According to Decree No. 74/2024/ND-CP dated June 30, 2024 (Decree No. 74), the current monthly minimum wage in Region I is 4,960,000 VND, Region II is 4,410,000 VND, Region III is 3,860,000 VND, Region IV is 3,450,000 VND. However, according to the Ministry of Home Affairs , up to now, there are a number of issues that need to be considered to adjust the minimum wage prescribed in Decree No. 74. The reason is that currently, in terms of socio-economic factors, the labor market, and the capacity of enterprises (DN), there are changes in a more positive direction. The macro economy continues to be stable, the economic growth rate (GDP) in the first 6 months of 2025 reached 7.52%, the target for 2025 is 8% or more; The labor market is stable and maintains its recovery momentum; business production tends to be better; wages and income of workers continue to be stable and increase, with each quarter higher than the previous quarter.

Increase wages to increase productivity.

Furthermore, with the CPI expected to increase by 3.7% each year in 2025 and 2026, the above minimum wage will no longer ensure the minimum living standard of workers and their families by the end of 2026, about 6.6% lower.

In addition, the National Wage Council has submitted a report to the Government recommending an average increase of 7.2% in the minimum wage, effective from January 1, 2026. Therefore, it is necessary to draft a Decree regulating the adjustment of the minimum wage by 7.2% compared to the current level, effective from January 1, 2026.

Accordingly, the monthly minimum wages in 4 regions are specifically regulated as follows: Region I is 5,310,000 VND/month, Region II is 4,730,000 VND/month, Region III is 4,140,000 VND/month, Region IV is 3,700,000 VND/month. The above minimum wages increase from 250,000 VND-350,000 VND (equivalent to an average rate of 7.2%) compared to the current minimum wage.

“The above minimum wage adjustment is about 0.6% higher than the minimum living standard of workers until the end of 2026 to improve the workers. This adjustment shares and harmonizes the interests of workers and enterprises, while paying attention to improving the lives of workers, while ensuring the maintenance and development of production and business of enterprises,” the Ministry of Home Affairs emphasized.

Increase wages to increase productivity

One of the noteworthy contents of this draft Decree is the area where the minimum wage is applied. The Ministry of Home Affairs emphasized that the update of the area where the minimum wage is applied needs to closely follow the actual situation after the administrative unit arrangement and the implementation of two-tier government from July 1, 2025. Accordingly, the zoning will be based on the main place of operation of the employer; in case there are branches or factories located in many regions, each unit will apply the corresponding regional minimum wage.

In particular, if the industrial park or export processing zone is located in an area with different minimum wages, the highest wage shall apply.

The monthly minimum wage is the lowest level used as a basis for negotiation and payment of wages for workers who are paid monthly and is similar to the hourly wage. Workers who receive wages weekly or daily, by product, or by piecework are converted to monthly or hourly wages, not lower than the prescribed monthly or hourly minimum wage.

In Vietnam, since 2000, the Government has adjusted the minimum wage 20 times in general, of which 15/18 times were adjusted on January 1. Other adjustments on January 1 every year are associated with unusual fluctuations. For example, the current minimum wage is applied from July 1, 2024 - this adjustment time is set in the context of the economy and society after going through the most difficult time of the Covid-19 pandemic and starting to move to a state of good recovery and many positive aspects.

According to the International Labor Organization (ILO) in Vietnam, in the period 2015-2022, the nominal minimum wage increased from 119 to 168 USD, but due to inflation, the actual increase was insignificant. In the period 2020-2022, the minimum wage increased by more than 6%, but the real wage increased by only 0.7%.

The ILO recommends that wage adjustments should be based on accurate data on inflation, growth, productivity, employment and the ability of enterprises to pay. Minimum wage increases should be sufficient to maintain the real value of income and meet the basic needs of workers and their families.

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Source: https://baolaocai.vn/tang-luong-toi-thieu-vung-cai-thien-doi-song-nguoi-lao-dong-post649334.html