Vietnam Announces Significant Minimum Wage Increase for 2026

New Minimum Wage Structure

Vietnam's government has officially announced a minimum wage increase of over 7% for all contract workers, effective January 1, 2026. The new monthly minimum wage will range between VND 3.7 million and VND 5.31 million, translating to approximately Rp 2.22 million to Rp 3.34 million based on the current exchange rate of IDR 0.63 per VND.

Regional Variations

The exact minimum wage will vary by region, reflecting Vietnam's economic development disparities across different areas. This adjustment is based on a government document signed by Deputy Prime Minister Ho Duc Phoc.

Impact on Businesses

The increase is expected to significantly affect labor costs for companies operating in Vietnam. As the minimum wage serves as a baseline for salary negotiations between employers and employees under employment contracts, this change could have far-reaching implications for businesses, particularly those with large workforces.

Economic Context

This wage adjustment demonstrates Vietnam's efforts to balance economic growth with worker welfare. The decision comes as Vietnam continues to position itself as an attractive destination for foreign investment, competing with other Southeast Asian nations.