Factory orders have dried up, and many Vietnamese companies have laid off thousands of people! a large number of unemployed workers
It is reported that Ty Hung, a shoe factory in Pingtan District, Ho Chi Minh City, Vietnam, announced that it would lay off 1,185 workers because there were no orders. The company said in a statement that its major customers had not placed new orders as they were facing financial problems.
The announcement stated that despite all efforts, the company was still unable to maintain production as planned, so it had to terminate the labor contracts with 1,185 workers on December 1.
The company said it will pay severance pay to employees who have been with the company since 2008, two months' pay to all employees whose social security contributions have been cut due to unemployment, and one month's salary to those who have worked for a year. Salary, other less than a year will be paid on a pro rata basis.
Ty Hung is a Taiwan-funded enterprise with a total of 1,800 employees, specializing in the production of footwear products, which are mainly exported to the European market.
In addition, in early October, Samho Vietnam, a Korean-funded company located in Cu Chi County, Ho Chi Minh City, was cut off from all orders by a well-known shoe brand. The factory's production capacity dropped by 30%, which was equivalent to 3,000 workers losing their jobs.
After that, the company submitted a plan to cut 1,400 jobs to the Ho Chi Minh Ministry of Labour, Disability and Social Affairs. The chairman of the company's labor union said that the company really wanted to keep its employees, but it was difficult to find new orders to make up for the situation.
According to Vietnamese media reports, some Vietnamese manufacturing companies are laying off a large number of temporary employees due to the same decrease in orders. One manufacturing company, for example, laid off more than 2,400 temporary workers after orders plummeted. Reports from some areas suggest that some companies have laid off hundreds or dozens of people.
According to the Labor Union of Ho Chi Minh City, due to difficulties in raw material procurement and reduced demand, the current general situation of textile, leather, footwear and electronics factories is that orders have decreased. In response, many factories in the city have shortened or furloughed workers, and some have been forced to lay off workers.
The vice-chairman of the Vietnam Federation of Chambers of Commerce and Industry said that global inflation has weakened consumption in major export markets, leading to a drop in orders. According to the Vietnam Leather, Footwear and Handbags Association, the number of orders from its corporate members fell by about 30% year-on-year in the fourth quarter, and export turnover has also been declining since September.
The vice-chairman of the Union of Ho Chi Minh City Business Associations said that apart from companies that produce essential goods such as food or household appliances, which have a steady number of orders, companies in many other industries are struggling.
A woman in charge of consulting and employment in the Tanshun Export Processing Zone under the Urban Business Development and Support Center said that compared with the same period in previous years, the recruitment needs of enterprises have dropped by 20-30%. At this time of year, factories have a lot of orders, often work overtime, hire heavily, and use more seasonal workers. However, many companies this year only allowed workers to work eight-hour shifts, or had to lay off workers due to lack of orders and raw materials.