TAIPEI (Taiwan News) — Pou Chen, the Taiwanese footwear titan that manufacturers shoes for Nike, Adidas, and Reebok, among others, has announced layoffs for 5,744 workers at factories in Vietnam this week.
Pou Yuen Vietnam, the company’s branch in Vietnam, is the largest employer in Ho Chi Minh City, and the new layoffs represent 10% of the company’s current workforce in Vietnam. Workers who will be let go will receive notice between June 24 and July 8, reported VN Express on Saturday (May 13).
The news comes just months after Pou Yuen let 2,358 workers go back in February, with the company devising a severance package totaling over US$11.5 million (NT$355 million) for the workers leaving the company.
Rumors of mass layoffs began in 2020 during the COVID pandemic when export orders began to decrease significantly. At that time, it was rumored that 30,000 employees would be laid off in Vietnam. However, in that year, only 2,800 were let go.
Despite recovering from the downturn during the pandemic, with a strong uptick in business over 2022, Vietnam’s export-driven economy is expected to slow in 2023. Fears of a global recession and domestic employment issues could negatively affect a number of important industries.
Like many other companies in light manufacturing, Pou Chen has not been able to maintain orders at pre-pandemic levels. In a recent meeting with Ho Chi Minh City officials, the company said “plummeting” orders have forced them to reduce their staff numbers, per VN Express.
This round of layoffs represents the largest downsizing of the company’s Vietnam workforce since Pou Chen began operations in Ho Chi Minh City back in 1996.
