More Than 32 Million Jobs Affected by Covid in 2020

According to the fourth-quarter and 2020 labor and employment survey conducted by the General Statistics Office (GSO), Vietnam had 32.1 million people aged 15 years and over negatively affected by the Covid-19 epidemic, including people who got fired, laid off and paid lower.

According to the GSO, 69.2% of Vietnamese people experienced a decrease in income, 39.9% accepted reduced working hours and took rotational leave and about 14.0% had to suspend business in 2020.

The service sector was most affected by the Covid-19 epidemic with 71.6% of workers affected, followed by the industry and construction sector with 64.7% and the agricultural sector with 26.4%.

The Covid-19 pandemic not only caused many workers to lose their job but forced many of them to enter the informal worker force.

Although the number of workers employed in the fourth quarter increased sharply from the previous two quarters, due to the sharp staff cut in the second quarter, the number of workers aged 15 and over in 2020 slumped over 2019. The number of working employees aged 15 years and over was 53.4 million people, a decrease of 1.3 million people over 2019 (or a decline of 2.36%).

According to the GSO, this development was in stark contrast to the annual employment growth trend in the 2010-2019 period. During this period, more than 600,000 people were added to the workforce each year on average.

The decrease in employed workers in 2020 was unprecedented in the past decade.

In addition, in 2020, as many as 20.3 million people were informal workers, an increase of 119,100 people while 15.8 million were formal workers, a shrinkage of 21,100 people over 2019. Informal workers accounted for 56.2% of the workforce in 2020, 0.2 percentage points higher than in 2019.

This development was contrast to the decreasing trend in recent years. In the period 2016-2019 prior to the Covid-19 pandemic outbreak, the number of formal workers increased by 5.6% a year while the number of informal workers increased by 3.6% a year.

The growth rate of formal labor was 1.6 times higher than that in informal employment, leading to a gradual decrease in the share of informal workers over the years.

However, the Covid-19 pandemic in 2020 disrupted the economy. This resulted in a decrease in formal workers and an increase in informal workers, thus adding up the share of informal jobs in 2020 after years of continuous decline.

In 2020, the Covid-19 pandemic also caused a decrease in average monthly income of workers in all three economic sectors. Accordingly, the average income of employees is VND5.5 million, down 2.3% over 2019 (or a drop of VND128,000).

The income of service workers decreased most, by VND215,000, followed by the agricultural sector with a reduction of VND156,000. The least reduction was seen in the industry and construction sector, by VND100,000 a month.

Source: Vietnam Business Forum