Vietnamese factories short of workers after severe closures – Cento Ventures

PHOTO FILE: The sewing of garments for export at a factory in Hung Yen province
FILE PHOTO: Women work at Hung Viet garment export factory, Hung Yen province, Vietnam, December 30, 2020. REUTERS / Kham

December 2, 2021

By Sayantani Ghosh and Miyoung Kim

(Dan Tri) – Factories in Vietnam are facing difficulties in staffing after many migrant workers returned home when the coronavirus restrictions kept them in Ho Chi Minh City for months last year. appease, a partner at venture capital firm Cento Ventures told Reuters.

A massive exodus from the city and neighboring industrial provinces has raised fears that labor shortages will hamper the recovery from a record third-quarter drop in GDP.

“When the heavy hand of the government… made hundreds of thousands of workers stay in factories to maintain exports, when the heavy hand finally withdrew, the workers returned to the village and they did not return. back,” Cento Dmitry Levit said at Reuters’ Next conference on Thursday.

Vietnam is one of the world’s largest garment manufacturers, with more than 6,000 textile factories employing around three million people. They offer brands like Zara, Ralph Lauren, North Face, Lacoste, and Nike.

Tens of thousands of people left Ho Chi Minh City after restrictions were eased in early October, ignoring authorities’ demands that they stay at work.

Last month, Vietnam said it was aiming to resolve the labor issue by the end of this year or early 2022.

Severe and prolonged lockdowns in Asian countries after the Delta variant swept through depressed economies and consumers, and made life especially difficult for companies with large businesses. business depends on the ground.

“The pandemic has made it difficult for the supply chain. Nipun Mehra, co-founder and CEO of Ula, an Indonesian startup that provides inventory and delivery services to the country’s retail kiosks, said.

Ula, valued at around $500 million, recently raised funding from Amazon’s Jeff Bezos.

Southeast Asian nations are the lifeblood of the supply chains that feed big companies in the West, and port closures and congestion have dented supply in the weeks leading up to Christmas.

Malaysian chip suppliers, who play a key role in global semiconductor production, have predicted it will take two or three years for the market to normalize, although the crisis is easing.

“Malaysia seems to be adjusting itself quite well,” Levit said.

Justin Hall, a partner at Golden Gate Ventures, said that governments in the region have not stepped up as they should to ease supply strains and that the private sector has not been able to solve problems on its own. so.

“There could be some improvement in the next 12-18 months,” he said, but added: “It’s an unwelcome status quo for the time being.”

(Reporting by Sayantani Ghosh and Miyoung Kim in Singapore; Editing by Catherine Evans) Vietnamese factories short of workers after severe closures – Cento Ventures

Bobby Allyn

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