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Whether yoga pants and Air Jordan appear under Christmas trees in the United States and Europe may be attributed to Vietnamese assembly line workers like Le Thi My.
I am part of a factory employee returning to my hometown from the southern industrial belt of Vietnam, which is the center of the country’s worst coronavirus outbreak. With months-long mobility restrictions that confined workers in cramped housing has recently eased, millions are ready to follow suit.
“We have almost nothing except fear,” Mi said, after leaving Ho Chi Minh City, she returned to her home in Tay Ninh Province along the Cambodian border. “We have seen many deaths from the new coronavirus in our neighborhood.”
The relocation from the industrial heartland of southern Vietnam — the government estimates that more than 2 million people may be evacuated — came after an increasingly stringent blockade began in July to combat the delta variant. Factory slowdowns or closures have caused months of production interruptions for companies such as Nike, and exacerbated problems in an already chaotic global supply chain.
Now, companies with a shortage of employees are begging employees like My to return to the peak period of normal production of winter clothing and Christmas gifts. The government is providing return transportation services, and the company is also increasing wages and benefits, but with little effect.
“This is unknown waters,” said Camilo Lyon, an analyst at BTIG, who estimates that Nike’s production alone has reduced 180 million pairs of shoes. “No one knows how fast or how slow the output is increasing.”
Although Vietnam is small, it plays a huge role in the global consumer economy, with everything from furniture from Wal-Mart and sports shoes from Adidas to smartphones from Samsung Electronics. According to data from the American Apparel and Footwear Association, it is the second largest supplier of clothing and footwear in the United States after China. During the trade war between the United States and China, its importance increased as manufacturing moved there to avoid tariffs.
At this point, almost no brand like Nike can do it. Nike recently lowered its sales expectations mainly due to the lack of products from Vietnam. Factory orders in other countries are overloaded, and it takes months to train workers and move machines.
Lyon said that the retailer’s production misses were particularly obvious in December and will continue into the first quarter. He expects that Vietnam’s production will not return to normal until the middle of 2022. The full impact of the turmoil has not yet been priced, he said, entering the stocks of apparel and footwear companies that have significant exposure in Vietnam.
“The challenge is not over yet,” Leon said.
Factory shutdowns may also affect technology companies such as Apple Inc. These companies may see an interruption in the delivery of iPhone 13 due to the closure of parts suppliers. A Samsung Electronics division that produces household appliances in Vietnam said that if it can quickly resume normal operations, it is expected to achieve its export goals.
Vietnam contained the new crown virus last year, making people mistakenly believe that the country escaped the pandemic. But the delta variant was hit hard in the spring, bringing the harsh reality of the virus experienced in most parts of the world a year ago. The number of cases and deaths has surged, including more than 15,000 people in Ho Chi Minh City this summer.
This prompted the authorities to impose strict restrictions, such as bans on food purchases and curfews. The factory was instructed to set up on-site accommodation — basically forcing employees who wanted to work to live in tents — or temporarily shut down. This has left many workers without salaries for months, saving less and less, and relying on government food parcels sent by soldiers.
Vu Tu Thanh, chief representative of the U.S.-ASEAN Business Council in Vietnam, said that this experience has traumatized many migrant workers.
Many workers did not isolate themselves in temporary factories and did not stay in the area without pay, but returned to their home provinces. Ho Chi Minh City and surrounding provinces lifted some restrictions earlier this month, which will only further encourage those who have not yet left to leave.
Even more worrying is that Vietnam has one of the lowest vaccination rates in Southeast Asia. Approximately 14% of its 98 million people have been fully vaccinated. The American Apparel and Footwear Association has lobbied the Biden government to donate more vaccines to the country.
The government has imposed severe restrictions, including curfews, to curb the spread of the virus [File: Maika Elan /Bloomberg]Out of desperation, local authorities have been sending text messages to workers to persuade them to return. They also chartered a car to bring them back from their hometown.
So far, Tran Thi Hoa, the 31-year-old mother of two children, has ignored these requests. She has no immediate plans to return to work in Ho Chi Minh City, where her monthly income from sewing clothes is about US$350.
“I can’t take my family back to this city now because it’s still too risky,” Hoa said in Vinh Long Province in the Mekong Delta. She now lives with her children and husband, who is an unemployed motorcycle. taxi driver. “As the head of the family, I must first consider my family.”
With the relaxation of restrictions at the beginning of the month, the output of some factories is increasing. According to the Vietnamese news website Zing, Baoyuan Vietnam, a subsidiary of Taiwan Baocheng Group, the world’s largest sports shoe manufacturer, resumed production on October 6, with no more than 30% of its workers. With more than 40,000 workers yet to return, the company may not be able to achieve its goal of operating at full capacity by mid-November.
However, there are signs that the situation may be improving. According to the Ho Chi Minh City Media Center, the industrial parks and export processing zones in Ho Chi Minh City reported that as of October 6, about 57% of workers had returned, up from 24% before the restrictions were relaxed.
Although the pandemic is beginning to ease — this month’s daily new cases have dropped from 10,800 in September to an average of about 5,000 — the country needs to continue to speed up its vaccination program. The government has stated that it hopes to fully vaccinate 70% of adults by the end of March.
At present, even providing free working meals and salary increases are not enough to attract Hoa back to work.
“If someone in the United States can’t buy some new Christmas clothes for her husband or her children, I feel sorry,” Hoa said. “But I can’t leave my family here either.”
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