HANOI, Vietnam – More than 10,000 workers walked off the job Wednesday at a South Korean plant that makes shoes for Nike, demanding higher pay to keep pace with rising prices in Vietnam.
The Tae Kwang Vina plant, in southern Dong Nai province, is one of 10 that contracts with Nike to produce shoes in Vietnam.
The average monthly salary at the plant, which makes shoes solely for Nike, is one million Vietnamese dong, or $62.
That’s about 20 per cent more than Vietnam’s minimum wage.
An official with Dong Nai Provincial Trade Union said that with the country’s 9.5 per cent inflation rate eroding their earnings, the workers are demanding higher pay, bonuses and cost-of-living allowances.
Nike Inc. reported a 51 per cent rise in profits last month during its first quarter.
In the most recent fiscal year, Nike made $1.5 billion on record sales of $16.3 billion.
The plant in Dong Nai, some 30 kilometres northeast of Ho Chi Minh City, employs more than 14,000 workers, most of them young women from rural areas.
Officials from the plant, run by the South Korean company Tae Kwang, declined to comment.
Alan Marks, a Nike spokesman, said the company was aware of the strike and was encouraging workers and factory management to work out their differences.
Nike said that its contractors in Vietnam make about 75 million pairs of shoes each year, and the Tae Kwang plant accounts for about 10 per cent.
Prices in Vietnam, Southeast Asia’s fastest growing economy, are 10 per cent higher than they were a year ago. The government has promised to increase the minimum wage by roughly 12 per cent, starting in January 2008.
As inflation has picked up in recent years, strikes have become more common, with workers demanding higher pay and better work conditions.
Last year, nearly 387 strikes took place in Vietnam, nearly 300 at foreign-owned firms, said Le Dinh Quang an official with Vietnam Trade Union.
In response, the government increased the minimum wage for workers at foreign firms by 25 per cent last year.