Workers withdraw insurance, receive unemployment benefits increase

In the second quarter of 2023, the total number of workers applying for unemployment benefits and withdrawing social insurance (SI) at one time nationwide increased by one and a half times compared to the first quarter.

According to the labor market bulletin of the Ministry of Labor, War Invalids and Social Affairs, in the second quarter, more than 357,500 people applied for unemployment benefits, an increase of more than 152,200 people compared to the first quarter.

The majority of workers applying for unemployment benefits do not have degrees or certificates, accounting for nearly 69%; followed by those with university degrees or higher at 13%; college degrees at 5.8%; primary education at 6.8% and secondary education at 5.4%. The manufacturing and processing industry is the group with the largest number of workers applying for unemployment benefits, about 46%; followed by services at 31%; agriculture, forestry and fishery at 4.4%; construction at 2.7%; wholesale and retail at 2.6%.

The largest number of workers applying for unemployment benefits are in five fields: tailors, assemblers, sales staff, electronics technicians and accountants. The beneficiaries are mainly in big cities with many industrial zones. In the first six months of the year, the Hanoi Employment Service Center received more than 43,500 people applying for unemployment benefits, an increase of 32% over the same period.

In the context of prolonged job cuts, the Ministry of Labor, War Invalids and Social Affairs forecasts that some industries will continue to experience fluctuations in human resources. Specifically, garment manufacturing such as textiles will cut 123,000 workers; agriculture and services will reduce 78,000 workers; retail will reduce 32,000 workers. In contrast, labor will grow in the food service sector by 114,000 workers; wholesale by 105,000 workers and electrical equipment manufacturing by about 69,700 workers.

The second quarter recorded a slight increase in the number of unemployed and underemployed workers compared to the previous quarter. The average income of salaried workers also decreased by VND79,000, reaching VND7 million.

Job loss and job cuts have caused the number of workers withdrawing social insurance at one time to increase, more than 665,000 people in the past six months, according to statistics from the Vietnam Social Security. In the second quarter alone, the number of people withdrawing social insurance at one time increased nearly 1.5 times compared to the first quarter.

The sharp increase in the number of workers receiving unemployment benefits and withdrawing social insurance at one time reflects the reality that businesses in various industries have lost orders and cut labor since mid-2022 until now.

Reporting to the Prime Minister on May 30, the Private Economic Development Research Board (Board IV) stated that the trend of withdrawing social insurance at one time has not stopped because of the wave of staff cuts that will last until the end of this year. This agency recommends that workers use their social insurance books as collateral or take out short-term consumer loans when their income is unstable.

The Ministry of Labor, War Invalids and Social Affairs said that this suggestion is related to financial and credit policies and is suitable for the current context. The Ministry will coordinate with the State Bank and relevant ministries and sectors to propose appropriate lending policies.

People wait to withdraw their one-time social insurance payment in Ho Chi Minh City, April 2023. Photo: Dinh Van — People wait to withdraw their one-time social insurance payment in Ho Chi Minh City, April 2023. Photo: *Dinh Van*

Statistics from 2016-2022 show that nearly 4.85 million people have left the social security system. Of these, 1.3 million people have returned to the system, continued to work and pay social insurance; nearly 3.55 million people have not returned; 907,000 workers have withdrawn twice; more than 61,000 people have withdrawn three times.

Hong Chieu

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