Vietnam’s leather and footwear manufacturers are concerned by the recent downturn in footwear exports and believe staff shortages are one of the driving factors behind the decline.

“The nation is losing its competitive edge to footwear rivals, including China, India, Indonesia and Thailand, because Vietnamese producers have to import 70% of their materials amid rising labour costs,” said Diep Thanh Kiet, deputy chairman of the Vietnam leather and footwear association (Lefaso).

Many firms in Ho Chi Minh City and southeastern provinces have been facing a real lack of workers, and particularly skilled workers, for many months now. Since the downturn began, many firms have seen their workforce reduced by more than half and manyfear the worst is yet to come as production and labour costs continue to rise.

Leather and shoe manufacturers are believed to be in a worse position that textile and garment producers. The industry, which at one time employed around 650,000 workers, has really struggled to stay afloat as a result of turmoil in the world’s economic markets.