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Vietnam Is Home to More Than 18m Unofficial Workers: Report

More than 18 million people are working unofficially in Vietnam according to a government report released last week.

The General Statistics Office of Vietnam, the International Labour Organisation (ILO) and the Ministry of Labour, Invalids and Social Affairs’ Institute of Labour Science and Social Affairs collaborated to write the report, according to Vietnam News. It polled nearly 20,000 households each month in 63 cities and provinces nationwide from 2007 and included data survey questions from 2014.

The study shows that 60% of unofficial workers live in rural areas in the Mekong and Red River Deltas while 20% are located in Hanoi and Saigon.

Unofficial workers tend to have unstable jobs, lack proper work contract, social insurance and work benefits. Some are even forced to work on verbal contracts for minimal pay.

It’s estimated that 76.7% of workers have no formal labor contracts. They also earn far less than their official counterparts. Their average wage is VND4.4 million (US$192) compared to VND6.7 million in the formal sector.

70% of the laborers work in manufacturing and processing, construction, wholesale-retail or vehicle repair. Another 11% work in lodging and catering services. According to VietnamPlus, they comprise 57.2% of the non-agricultural workforce. Those in the northern mountainous Midlands and the Central Highlands are mostly involved in agriculture and forestry.

The businesses that employ unofficial workers are often unregistered or fail to pay social and health insurance or other forms of welfare to workers. Up to 97.9% of unofficial workers lack social insurance compared to the 80.5% of workers in the formal sector that have it.

Director of the Institute of Labour Science and Social Affairs, Dao Quang Vinh, advocates plans that encourage business households to apply for registration. He also suggests policies that provide the unofficial workers with capital, technology and workforce training

Director of ILO Vietnam, Chang Hee Lee, explained that the country can reduce the number of unofficial workers by promoting employment that includes labor contracts, and social and health insurance. He believes the report will help ministries and agencies enact appropriate policies to address these needs.

[Photo by Aaron Joel Santos]

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