Garment exports hit hard by labor shortage

Garment and textile firms face labor shortages and broken supply chains, and find it hard to fulfill their export orders, the Vietnam Textile & Apparel Association has said.

The fourth and most intense wave of Covid-19, which caused many textile companies to close down or operate at partial capacity between July and September, remains a severe problem in many cities and provinces, especially in the south, and so migrant workers are making an exodus to their hometowns.

Some one million workers in the sector, or one third the total number employed, have quit their jobs or are staying away from work with or without pay, VITAS estimated.

Meanwhile, supply chains continue to be broken as a number of foreign clients shift their orders to other countries.

Many companies in the south have adopted the stay-at-work and commute-to-work models, but managed to get only 10-30 percent of their employees, meaning they have found it hard to maintain production and ensure timely delivery of goods, VITAS said.

Garment and textile exports fell 9 percent month-on-month in September to $3 billion. The figure for the year-to-date was $29 billion.

VITAS has three different export scenarios depending on how the Covid situation pans out: it expects shipments of $33.5-34 billion this year if the pandemic continues until early December, $36-36.5 billion if until November and $37.5-38 billion if it is controlled by October.

“It is very difficult for the sector to realize the export target of $39 billion set for this year,” Vitas vice chairman Truong Van Cam said.