The increase to the minimum salary in 2017 will be less than the 2016 increase of 12.4 per cent, according to Mr. Pham Minh Huan, Deputy Minister of Labor, Invalids and Social Affairs and Chairman of the National Wage Council.

The Council is now preparing for its meeting on the increase to the minimum salary next year and wishes to hear from enterprises about the impact of wage policies on their insurance obligations.

In previous years the Council selected wage plans for discussion, while this year a special group within the Council has the task.

Mr. Huan said he understands that salary increases can be a major problem for enterprises, especially given the increasing competitive pressure. Labor productivity at Vietnamese enterprises is said to be very low compared to the region.

If labor costs in Vietnam become too high, enterprises will be unable to afford to renew their manufacturing lines, he said.