Women at work in a garment factory in Vientiane.

Trade union body urges business operators to increase the minimum wage

The Lao Federation of Trade Unions has called on business operators to raise the minimum wage, in a bid to help workers struggling to cope the rising cost of living, which is exacerbated by the depreciation of the kip.
Vice President of the Federation and the Executive Committee, Mr Vilay Vongkhaseum, addressed a meeting in Vientiane to review cost-of-living data and discuss proposals to raise the minimum wage for workers, as Laos continues to deal with spiralling living costs and economic headwinds.
He said “As living costs continue to rise, and with additional pressure caused by inflation and currency exchange rate shifts, it is essential that wage policies reflect workers’ actual circumstances.”
The meeting aimed to determine a unified methodology for wage calculation, improve workers’ living standards, and ensure balanced benefits for employees, employers, and overall national socio-economic development.
Participants reviewed current wage conditions, analysed market price surveys conducted in several provinces, and discussed proposed minimum wage figures.
Their discussions are expected to inform recommendations for consideration by the National Labour Committee, a tripartite panel that includes representatives from government, employers, and workers.
In the wage adjustment process, the National Labour Committee conducts research, compiles and presents data from all sides, holds consultations, and agrees on proposed figures before submitting final proposals for government approval.
Officials said minimum wage adjustments are made periodically based on a range of economic indicators including cost of living, workers’ income and expenditure, inflationary pressures, and wage trends in neighbouring countries.
They noted that broader macroeconomic conditions also play a critical role in determining wage policy.
Effective October 1, 2024, the minimum wage in Vientiane was increased to 2.5 million kip (approximately US$114) per month, up from the previous 1.6 million kip, in response to escalating living costs and currency depreciation that eroded workers’ real incomes.
Laos is classified as a lower-middle-income economy, and challenges such as reliance on commodity exports, inflation, and the significant cost of imported goods mean that wage policy plays a central role in supporting household purchasing power.
Concerns over inflation and living costs have been a persistent feature of the Lao economy in recent years, underscoring the need for periodic wage reviews to ensure that workers enjoy a decent standard of living.
Economists note that wage adjustments can influence business competitiveness, labour mobility, and investment decisions, which are factors that policymakers must balance to ensure adequate living standards for workers.
The meeting was co-organised by the Lao Federation of Trade Unions in cooperation with Oxfam in Laos, and was attended by representatives from relevant ministries, trade unions, and partner organisations.
 

By Times Reporters
(Latest Update February 25, 2026)