Increase regional minimum wage by 7.2% from 2026: Harmonizing the interests of businesses and workers

The average increase in the regional minimum wage in 2026 of 7.2% (the level the National Wage Council finalized and submitted to the Government for approval) is expected to contribute to improving income, helping workers to better cover their living expenses in the face of increasing living costs, especially housing, electricity, water, food and education costs for children. Increasing the regional minimum wage also helps maintain work motivation, creating a bond between workers and businesses.

Increase motivation to stay with the business

When income is improved, employees will feel more appreciated and recognized for their contributions. This directly increases work motivation, encouraging employees to strive to improve productivity and quality of work. They will also tend to stay with the business longer, reducing the rate of personnel fluctuation.

However, given the reality of inflation and depreciation, the 7.2% increase may not really help workers have a significant savings or significantly improve the quality of life for low-income families.

After comparing data and information on regional minimum wage increases in recent years, Mr. Luu Kim Hong, Chairman of the Trade Union of Nidec Vietnam Co., Ltd. (Ho Chi Minh City High-Tech Park), shared that the average increase in regional minimum wage of more than 200,000 VND/year is still too low. According to Mr. Hong, it would be more appropriate to have an automatic mechanism to increase the minimum wage in the direction of increasing it annually by a few percent higher than the inflation index to both compensate for inflation and have savings for workers.

Workers of Juki Vietnam Co., Ltd. (Tan Thuan Export Processing Zone, Ho Chi Minh City) work in the factory. Photo: THAI PHUONG

Increasing the regional minimum wage benefits workers but is a challenge for businesses, especially in the current economic context. According to some business owners, increasing the regional minimum wage will be accompanied by an increase in labor costs. Increasing the minimum wage means that businesses must increase their payroll costs, including social insurance, health insurance, unemployment insurance and union fees. This will put pressure on production and business costs.

This challenge is most evident for small and micro enterprises; especially those that are facing difficulties in orders and markets will be under greater pressure. Large enterprises, in particular, often have salaries higher than the regional minimum wage, so the impact may not be too great.

According to the proposal, the regional minimum wage will increase from January 1, 2026.

Region I: From 4.96 to 5.31 (million VND/month)

Region II: From 4.41 to 4.73 (million VND/month)

Region III: From 3.86 to 4.14 (million VND/month)

Region IV: From 3.45 to 3.7 (million VND/month)

However, with the average increase of 7.2% that the National Wage Council has finalized to submit to the Government for approval, experts assess that it is harmonious, both ensuring the rights of workers and creating conditions for businesses to have the opportunity to recover and develop in a context of many challenges.

According to the survey results conducted by the Vietnam General Confederation of Labor in March and April this year (with nearly 3,000 workers responding to questionnaires in 10 provinces and cities), 54.9% of workers said their salary and income were just enough for basic family expenses; 26.3% had to spend frugally; 7.9% did not have enough to live on and had to do other jobs to earn more income to cover their living expenses.

Control inflation, support businesses

Mr. Ngo Duy Hieu, Vice President of the Vietnam General Confederation of Labor and Vice President of the National Wage Council, said that the proposed regional minimum wage this time has met the expectations and wishes of union members and workers nationwide; at the same time, it shows the spirit of sharing the difficulties of businesses.

“This salary will also motivate workers to work with enthusiasm and make efforts so that by the end of this year we can achieve the 8% growth target and from next year onwards we can achieve the double-digit growth target of the Vietnamese economy,” said Mr. Ngo Duy Hieu.

National Assembly Delegate Thai Thu Xuong, Permanent Vice President of the Vietnam General Confederation of Labor, also informed that voters, especially workers in industrial zones, are facing double pressure from rising electricity and gold prices, leading to rising food prices. According to Mr. Thai Thu Xuong, many workers still have to live in cramped boarding houses and struggle to make ends meet. Therefore, Mr. Thai Thu Xuong recommended that the Government should have solutions to effectively control inflation, stabilize prices of essential goods, and urgently consider adjusting the regional minimum wage, or even adjusting it earlier to suit reality.

Agreeing with this view, Mr. Nguyen Viet Cuong (independent expert of the National Wage Council) said that increasing the regional minimum wage must ensure the basic principle of compensating for inflation and ensuring a minimum standard of living.

Workers in Ho Chi Minh City buy essential goods at preferential prices. Photo: THAI PHUONG

To ensure the rights of businesses and workers, experts suggest considering reducing or postponing certain taxes and fees, or adjusting other contributions so that businesses have resources for reinvestment. In addition, continue to provide preferential credit packages for businesses so that they do not suffer from cash flow disruptions due to increased wage costs. At the same time, the State strengthens inspections and checks to ensure that businesses strictly comply with regulations on minimum wages; strictly handle violations to protect workers' rights.

Mr. Hoang Quang Phong, Vice President of the Vietnam Confederation of Commerce and Industry (VCCI), Vice President of the National Wage Council, stated that employers must be determined to improve their management capacity and apply science and technology with the goal of ensuring the maintenance of business development indicators, protecting the number of jobs and especially retaining skilled workers in the context of increasing wages as well as other costs.

Mr. NGUYEN MANH KHUONG, Deputy Minister of Home Affairs, Chairman of the National Wage Council:

Appropriate increase for the current period

The plan to increase the regional minimum wage in 2026 was "finalized" by the National Wage Council to submit to the Government as an average increase of 7.2%, equivalent to an average increase of 300,000 VND/month compared to 2025. This is an increase appropriate to the current stage of the country's economic development, towards the era of national growth as well as the target of 8% economic growth in 2025 and double digits in the following years.

Dr. TRAN QUANG THANG, Representative of Ho Chi Minh City People's Council, Director of Ho Chi Minh City Institute of Economics and Management:

Synchronize multiple policies

For the wage increase to be truly meaningful, it is necessary to synchronize many policies such as adjusting the personal income tax deduction level, helping workers to retain the increased income, avoiding the situation of "salary has not increased, price has increased". At the same time, reduce taxes, fees, access to capital, train human resources, extend tax payment time and social insurance for small and medium enterprises so that these enterprises can adapt to the increase in labor costs. Workers' housing, health care, education, and insurance need to be improved to reduce the burden of spending and ensure that enterprises properly implement the minimum wage, not "circumvent the law" by increasing nominal wages but reducing allowances.

Mr. NGUYEN VAN HUNG, Chairman of the Trade Union of Dai Dung Construction and Trading Mechanical Joint Stock Company:

Great motivation for workers

Increasing the regional minimum wage by 7.2% is a necessary step to ensure social security and share the fruits of growth. For workers, this is a great motivation for them to contribute and improve their quality of life. For businesses, this is a challenge but also an opportunity for them to review and optimize their operations, moving towards a more effective and sustainable business model, not only relying on the advantage of cheap labor.

CIVILIZATION - THAI PHUONG - PHAN THAO - NGO BINH

Source: https://www.sggp.org.vn/tang-luong-toi-thieu-vung-72-tu-nam-2026-hai-hoa-loi-ich-doanh-nghiep-va-nguoi-lao-dong-post803762.html