According to Vietnamese media reports on March 13, many furniture factories in Vietnam are facing a sharp drop in orders. The number of orders has been falling since April last year, the data showed. The order volume of Vietnamese furniture manufacturers has dropped by more than 20% since 2023, which is far more than expected. Many companies have even experienced large-scale layoffs. Some experts said that the government needs to introduce new policies to support enterprises, create jobs and promote consumption in the Vietnamese market to prevent large-scale layoffs in the furniture industry due to the drying up of export orders.
Exports are down! Vietnam calls for policies to reduce layoffs in furniture factories
Nguyen Liem, head of the Binh Duong (province) Furniture Association and chairman of Lam Viet Wood Co., said his company has retained more than 1,000 workers but has reached its limit. "We can only hold out until the end of the third quarter," he said. If the slump in orders continues, it is likely to be at risk of closure. Many Vietnamese furniture manufacturers are also facing the same problem. Some furniture manufacturers said that although the government has provided some support for furniture companies, these supports are not clear enough and it is difficult to apply.
He believes that the downturn in orders will continue for some time, and the subsidies for workers are not very practical, but if companies are allowed to defer the payment of social insurance contributions to workers for 6 to 12 months, they will have funds to pay wages. In addition, the government should also introduce more new policies to support enterprises, create jobs and promote consumption in the Vietnamese market, so as to prevent large-scale layoffs in the furniture industry due to the drying up of export orders. “Businesses most want to keep workers. They will only lay off workers if they really can’t handle the money. Policies to support factories will also help workers.”
Vietnam's furniture industry is one of Vietnam's main export industries, contributing a lot of GDP and employment opportunities. According to Vietnamese official data, Vietnam's furniture exports have grown rapidly since 2019 and will reach US$3 billion in 2022, becoming one of Vietnam's main export commodities. However, since 2023, the situation has taken a sharp turn for the worse. According to the Vietnam Furniture Association, during January-February 2023, Vietnam's furniture exports were valued at US$702 million, a drop of 5.5 percent from the same period last year, which had already dropped by 12.3 percent. Vietnam's furniture industry is also looking to expand into the domestic market to cushion the impact of falling export orders. However, due to the relatively low demand for high-quality furniture in the Vietnamese market, the development of the domestic market still faces many challenges. In conclusion, Vietnam's furniture industry is facing severe challenges. The government needs to introduce more support measures to help enterprises tide over the difficulties. At the same time, it also needs to find new market opportunities and bring new development opportunities for the furniture industry.