The Navigos Group, the leading recruitment solutions provider in Vietnam, last week announced its findings that there had been a 16.47 percent increase in Vietnamese workers' average gross salaries during April 2008 to March 2009.

The findings are part of the labour match-maker's Vietnam Salary Survey 2009, which studied 163 employers across Vietnam, spanning more than 15 industries and 75 job categories.

Among the participating companies in the survey, 47 percent were wholly foreign-owned entities, and local Vietnamese companies making up 11.7%.

The Vietnam Salary Survey 2009 found that gross salaries increased across most industries, with real estate and property development sectors leading the pack with a 23.25 percent jump. The financial services sector, which had led salary increases for the last two years, dropped to second place with an average of 21.78 percent rise.

In terms of localities, companies in the south and outside of HCM City reported the highest salary increases of 20.54 percent ahead of HCM City and Hanoi, which saw rises of 16.34 and 16.08%, respectively.

"Even though the job market may not be as hot as before, there are still gaps between supply and demand in the labour market, which is the key driver of the salary trend we're ping.

"Percentage increase could also be misleading, as some industries were slow to catch on to economic growth until recently and thus will need a more sizable increase to meet the surge in demand, even in a slowed economy," said Winnie Lam, Navigos Group's HR Advisory Services director.

Plus with the Vietnamese government's projected hike in minimum salaries for workers of all economic sectors in the beginning of next year, the recent pay raises will concern foreign investors, who voted Vietnam as one of the world's most attractive investment destinations.

The Ministry of Labour, Invalids and Social Affairs (MoLlSA) recently said that in the beginning of 2010, Vietnamese workers' minimum salaries at state-run and domestic private enterprises would increase by 13-15%, while those in foreign invested enterprises' workers would enjoy a 9-11 percent rise against the current levels.

The MoLlSA attributed such planned rises to the ministry's road map to make minimum salaries common across all economic sectors in the country by 2012.

State-run and domestic workers' current minimum salaries are 800,000 dong ($45.4), 740,000 dong ($42.0), 690,000 dong ($39.2) and 650,000 dong ($36.9) per month for four different geographical zones. Meanwhile, foreign invested enterprises' workers are now subject to monthly minimum salaries of 1.2 million dong ($68.1), 1.08 million dong ($61.3), 950,000 dong ($53.9) and 920,000 dong ($52.7), also depending on their enterprises' locations.

Sachio Kageyama, general director of Canon Vietnam, said that it was not the right time for governmental plans to raise salaries amid the economic crisis, which had driven prices high and stunted demand for exports.

"With a huge labour force of 17,000, the projected minimum pay rises will put a great strain on our businesses," Kageyama said.

In the most recently released investment trend surveys, conducted by creditable international organisations- like the-United Nations Conference on Trade and Development, the UK Trade & Investment and Japan Bank for International Cooperation, low labour costs were a dominant indicator that helped Vietnam win friendly foreign direct investment status.

Vietnam Investment Review - September 29, 2009