HANOI – Vietnamese government is about to raise the base wage for civil servants by 20.8 per cent from July 1 to keep pace with rising consumer prices, Xinhua quoted a Vietnam News Agency report on Monday.
The pay review is set to include nine groups of public sector workers, such as civil servants at both state and local levels, teachers, doctors, police, and the armed force, according to a government decree announced on Sunday.
After the base wage has been frozen over almost four years, it will increase to 1.8 million Vietnamese dong (US$76 US) per month from 1.49 million dong (US$63).
Vietnam’s consumer price inflation has expanded about 10 per cent since July 2019, the last time the minimum wage for civil servants was hiked, said the Ministry of Home Affairs.
Vietnam’s consumer price index in the first four months of this year rose 3.84 per cent from a year ago, due to higher school fees and housing costs as well as more expensive food prices, according to the General Statistics Office.
The government is targetting average inflation of 4.5 per cent for the year.
Meanwhile, pay growth in the public sector has lagged that of private sector workers, averaging just 7.19 per cent compared with 17.7 per cent in the private sector, where it has been bolstered through three upward revisions since the beginning of 2019.
The move would cost the state budget an estimated 59 trillion Vietnamese dong (US$2.5 billion) in the second half of the year, said Nguyen Duc Chi, deputy finance minister, at a press conference earlier this month.
As many as 40,000 employees in the public sector, especially those working in education and healthcare services, have quitted their jobs since 2020, the report said.
These concerns, coupled with the need for a wage hike to offset the rising cost of living, have piled pressure on the government amid slowing economic growth and an uncertain global outlook. – Bernama
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