Laos’ Minimum Wage Struggles to Meet Rising Costs of Living
Economic Pressures Force Workers to Rely on Multiple Jobs to Survive
State government worker Noy, who also works as a part-time taxi driver, struggles to make ends meet on Laos’ minimum wage of LAK 2,500,000 (approximately USD 117) per month. With essential bills like groceries and utilities taking up most of his income, he is left with barely enough for other expenses. Despite working additional hours as a taxi driver, earning LAK 2,000,000 (approximately USD 92) per night, Noy’s combined income is still not enough to cover his family’s living costs. The wage increase from LAK 1.6 million (about USD 75) has been deemed inadequate, especially with the rising cost of living.
The country’s rising inflation, depreciation of the Lao kip, and the lack of significant wage growth are forcing many students to drop out of school to work instead. As they face the harsh reality of limited job opportunities and wages that barely cover living expenses, many young people are turning to work abroad, particularly in South Korea and Thailand. This trend is contributing to a potential weakening of Laos' future workforce, as fewer students pursue higher education, with the belief that they won’t earn enough from a minimum wage job to survive.
Business owners also feel the effects of low wages, as they struggle to balance fair pay with the need to maintain profitability. A café owner in Vientiane explained that while they’ve raised wages for entry-level workers, the current minimum wage still fails to meet the demands of inflation, putting both employees and employers under financial strain. While many Lao workers call for an increase in the minimum wage to LAK 5 million (about USD 230) to survive, businesses are worried about the long-term impact of wage adjustments on their operations.
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The country’s rising inflation, depreciation of the Lao kip, and the lack of significant wage growth are forcing many students to drop out of school to work instead. As they face the harsh reality of limited job opportunities and wages that barely cover living expenses, many young people are turning to work abroad, particularly in South Korea and Thailand. This trend is contributing to a potential weakening of Laos' future workforce, as fewer students pursue higher education, with the belief that they won’t earn enough from a minimum wage job to survive.
Business owners also feel the effects of low wages, as they struggle to balance fair pay with the need to maintain profitability. A café owner in Vientiane explained that while they’ve raised wages for entry-level workers, the current minimum wage still fails to meet the demands of inflation, putting both employees and employers under financial strain. While many Lao workers call for an increase in the minimum wage to LAK 5 million (about USD 230) to survive, businesses are worried about the long-term impact of wage adjustments on their operations.
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