In early January 2023, a Vietnamese media outlet featured the story of the Hương family:
The couple and their daughter lost their jobs at the beginning of December last year. While her two children were looking for work, the 63-year-old mother scavenged bottles and sold them for money. In order to have a meal with vegetables, she often picked water hyacinth from the fields around the apartment to boil, eat raw, or fry with pork fat.
Water hyacinth, an aquatic plant that is often considered a weed to be cleaned out of canals and is only mentioned in the documents of the Department of Transportation, is now a source of food for some of the laid-off workers in recent months. The story of the Huongs is but a small glimpse into the conditions of laid-off Vietnamese workers.
Toward the end of 2022, Vietnamese workers faced mass layoffs as a result of the global economic slowdown. According to the Vietnamese General Confederation of Labour (VGCL), from September 2022 to the end of January 2023, a total of 546,835 workers from 1,300 enterprises were affected. Among them, 491,212 workers had their working hours reduced, or had to take paid leave; 7,000 workers were suspended or had to take unpaid leave, and 48,623 were laid off. The majority work for foreign enterprises operating in the textile, footwear and wood processing industries.
As disclosed by the Ho Chi Minh City Union of Business Associations, orders from the main export partners had reduced drastically in the second half of 2022: a 60% reduction of orders from Europe, and 30-40% from the United States. At the same time, export prices of these products fell by 55-60%, causing a double crisis for Vietnamese manufacturers. Companies made workers pay the price.
A Farewell Party
The iconic scene that represents the layoff wave was an impromptu farewell party organised by workers for themselves on the side of the street in late November 2022. As reported by local media, they were part of the 1,200 workers who had just been laid off by Ty Hung, a textile company in Ho Chi Minh City.
This farewell party saw participation of workers of different seniority, signifying the scale of the layoffs that reached even those who hadn’t thought once that they would face this possibility. With these layoffs, gone were the dreams and hopes of the workers: the dreams of a pension, of a happy Lunar New Year with their family and of a future for their children.
Many of these laid-off workers had been employed for more than 10 years at Ty Hung, located in the Binh Tan District of Ho Chi Minh City. The consequences for these workers are immense, not only in terms of financial security. Talking to the newspaper Tuoi Tre, Hong Tuoi, a worker who had been with the company for 18 years shared her situation:
I had worked here since I left home as a young girl for the city. Suddenly they laid me off, so I don’t even know what to do. I probably need to go find a new job either way because if I don’t work now, who will take care of the children at home? I don’t even know if I will find a job because I have never had to switch jobs, and no companies around here have enough orders.
As Tuoi’s story shows, the security of the job is tied in with the security of her family and children. The loss of her income also means the potential uprooting of her whole family from their life in the city. The uncertainty was also compound by the looming Lunar New Year, which meant companies would not have new job openings. Given this, many workers took a gamble by staying unemployed in the city until after the New Year holiday.
Like Tuoi, another worker named Hang also faced a dilemma whereby she could not leave the city as her child was still studying at a school there: “If I go back to the countryside, the kid will have to drop out of school halfway, so I have no choice but to stay and find another job,” she shared with a journalist.
The Deep Impact of Layoffs
Such sudden layoffs also carry significant problems for workers’ welfare benefits. For those who have worked for a long time, the bitterness of the layoffs come not only from the loss of income but also the loss of a financially secure retirement.
To go back to the Ty Hung case, Huong is another worker who had worked full-time at the company for 17 years. In just three years’ time, she would have reached 20 years of social insurance contributions that would allow her to receive retirement benefits. With the layoff, she might not make it to the 20-year requirement because it would be difficult for a middle-age woman like her to find a full-time job again.
Given the lack of trust in the social insurance system, more and more workers opt to withdraw their participation in the social insurance scheme to receive a one-time lump sum of money instead. The situation is no better for workers who had their working hours reduced. Since their contracts are still valid, they would not be entitled to unemployment benefits.
With the lack of jobs, many workers who stay have to switch to alternative means of making ends meet. The economic desperation means unemployed workers are taking on all sorts of jobs available.
VnExpress reported the story of Dien, a 49-year-old worker who lost her job, found temporary work in a local textile shop, where she was paid 280 VND (USD 0.012) per finished piece. On her first day of work, without taking a toilet or water break, she managed 100 pieces and was paid 28,000 VND, barely above the mandated minimum wage of 22,500 VND/hour.
As Lunar New Year approached, many laid-off workers also found jobs at local flower gardens, paid 160,000-180,000 VND for eight hours. After eight hours, these workers would not make enough to buy the very plants that they had spent all day tending, the plants that play an important ceremonial role for all Vietnamese families during Lunar New Year.
Other unfortunate workers who could not find temporary employment turned to odd jobs and street gigs to make money. Or in the language of affluent business writers, they invoked the “entrepreneurial spirit” of the Vietnamese people.
What do these laid-off “entrepreneurs” do? They sell grilled bananas on the side of the street, scavenge garbage from nearby dumps and harvest wild plants from the roadside, which will become their source of food should they not be able to make any money.
It has been noted that the VGCL plays an important role in tackling the layoff waves. This entails acting as a mediator between workers and companies, ensuring laid-off workers are compensated according to the law, or providing emergency financial support for those in need.
In most cases, however, these moves are reactive, focusing on remedying the local symptoms of a slowing global economy. The VGCL plays not so much the role of a representative of workers against companies, but rather an ad-hoc welfare agency with its “temporary remedies such as purchasing bus tickets for workers to travel back home, running charity events, or providing one-time monetary gifts.”
Because of the structure of the Vietnamese labour force and the looming Lunar New Year, it was difficult for labour unions in 2022 to address the impact of the layoffs properly. As reported by VnExpress, first, workers who received unemployment insurance preferred to take on part-time temporary work instead of contracted work since starting at a new workplace meant their wage and New Year bonus would be lower.
Therefore, many waited through three months of unemployment insurance and withdraw their lump sum from the social insurance scheme after one year. With the New Year approaching, working temporary jobs also allowed workers to find time to return home for the holiday.
Second, many laid-off workers had experience working in the manufacturing sector, while the available jobs were to be found in the service sector, making it difficult for them to make the switch. The proximity of the workplace was also a reason, as manufactures are located in the outskirts of cities, while services are located within the cities.
This endemic precarity plagues the minds of both workers and policymakers alike, for any decisions could be completely fruitless in the event of a new economic slowdown while the cost of making decisions would still be there to be recuperated.
Hope in Hopeless Times
In its special broadcast during the eve of Lunar New Year 2023, the Vietnamese state television chose “Tet (New Year) means Hope” as the title of the programme. Hope here signifies the traditional value that New Year is often associated with in Vietnamese culture: that it will bring with it new opportunities, new fortunes and new luck for people.
Acknowledging the challenges that the country faced throughout the year, especially in terms of the post-pandemic economic recovery, hope is understandably an apt choice for the final broadcast of the year. Indeed, hope is one of the most valuable traits that makes us human.
However, hope could also mean something else. Writing in his book Hope in Hopeless Times, John Holloway cautions us about the cultural meaning of hope in the age where the spirit of neoliberal capitalism seems to have a transcendent position in our minds. When such a system becomes so total and seems to penetrate every pore of the social fabric, to hope is to be helpless.
Holloway describes a stark difference between two forms of hope. One is more aligned with “wishful thinking”, signifying a lack of ability of the person to realise their hopes. Therefore, what they can only do is hope that somehow something positive will happen.
However, there is another form of hope that has long been lost in modern society, argued Holloway. It is the hope that makes history: the hope of those who have the ability to take matters into their own hands.
At the end of 2022, with the entrenchment of the Vietnamese economy in global neoliberalism through its labour-intensive, export-led model, the global economic downturn has shown the vulnerability of the country as a manufacturing hub of the world. For many Vietnamese across the country, to hope is to be truly helpless against the force of a “global economy”.
Laid-off workers like Hong Tuoi from Ty Hung hope that there will be a job opening somewhere; her co-workers who have had their hours reduced hope for the chance to work overtime again; her boss, the owner of Ty Hung, hopes that the Europeans will stop the war and come back to business.
At the time of writing, the festivities of Lunar New Year had come to an end, and the economic machine had restarted. While those fortunate enough to have kept their jobs had returned to their factories, the forecast by the VGCL indicated that an additional 272,000 workers would face reduced hours and 15,800 would be laid off.
At the same time, new openings were not being filled with replacements, signifying a reluctance of workers to join the workforce. While the alternatives are often worse, the highly precarious manufacturing jobs are hardly attractive. Whether this labour shortage will force manufacturers to improve wages and working conditions remains to be seen.
In 2023, the Vietnamese economy will not be decoupled from the dynamics of its export market, and Vietnamese workers will continue to be subject to the perils of global capitalism. The question is whether they will take matters into their own hands.
(Photo: Bangkok Post)