Salary benchmark in Vietnam is a crucial tool for businesses competing for talent. This article explores how benchmarking works, why it matters, and how employers can use it to build fair, competitive pay structures with expert support from Manpower Vietnam.
What is salary benchmarking?
Salary benchmarking is the process of collecting, analyzing, and comparing salary data for specific job positions across industries, regions, and company sizes. Far beyond a simple salary guide, the pay benchmarking delivers deeper analysis and insights into how competitive your compensation packages are compared to other employers in the market.
How does salary benchmark in Vietnam work?
A salary benchmark service is a structured process provided by HR consulting or a third-party services providers. The process typically includes the following steps:
1. Define the benchmarking objectives
The process begins with aligning on what the organization wants to achieve. This may include:
Setting competitive pay levels to attract and retain talent
Aligning salaries with market rates after expansion or restructuring
Supporting pay transparency and internal fairness
Preparing for annual compensation reviews or new hiring needs
The provider typically holds a briefing session with the HR or C&B (Compensation & Benefits) team to define target job families, seniority levels, industry focus, and geographic coverage (e.g., Vietnam vs. APAC vs. global).
2. Data collection
Salary benchmark providers in Vietnam collect data from multiple sources to ensure accuracy and breadth, such as:
Proprietary salary surveys (e.g., conducted by Mercer, or Korn Ferry)
Government labor data (e.g., GSO in Vietnam)
Client-contributed datasets through anonymous company participation
Real-time market data from job postings, placement records, and offer acceptances
Leading providers, such as Manpower Vietnam, also use internal recruitment databases collected from thousands of placements across industries and positions annually, giving them unmatched visibility into real hiring trends.
3. Job matching & standardization
Each internal role from a company is matched against standardized market job titles using global frameworks (e.g., Mercer IPE, Hay Guide Chart). This ensures consistency in comparing:
Role responsibilities
Seniority levels
Reporting structure
Industry specialization
Misalignment in job leveling is one of the most common errors in internal compensation benchmarking in Vietnam. Therefore, professional services ensure a proper “job slotting” phase for accuracy.
4. Market analysis & peer comparison
After job matching, the provider benchmarks each role against:
Median market salary
25th and 75th percentile compensation
Fixed vs. variable pay structures
Total rewards package (base salary, bonus, allowance, stock options, etc.)
Companies may also request comparison against a peer group, such as similar-sized competitors in the same sector (e.g., FMCG firms in Ho Chi Minh City), or cross-industry views for highly mobile talent (e.g., IT engineers).
5. Reporting & insights
The benchmarking service delivers a detailed salary report that includes:
Salary bands by job level and function
Market positioning of current pay structure
Gaps or misalignments vs. market benchmarks
Trends in salary movement, talent demand, and retention risk
Reports are often customized by department, business unit, or region. Some providers also include predictive analytics (e.g., projected salary inflation, demand trends).
Benefits of conducting salary benchmark in Vietnam
Salary benchmarking provides multiple advantages for business leaders and HR teams:
1. Retain critical talent
Employee retention becomes increasingly difficult when your pay structures fall behind the market. According to a report from Manpower Vietnam and Jobs_that_makesense, up to 40% of survey participants identified salary as their top priorities.
When employees feel they are being fairly compensated, they are more likely to stay, reducing turnover, retraining, and productivity loss. Salary benchmarking also helps proactively identify retention risks before they become resignations.
2. Attract top candidates
Top-tier talent evaluates job offers not just on role or culture - but also on pay competitiveness. By aligning your salary offers with current market rates, you improve acceptance rates and shorten your hiring lead times. Compensation benchmarking also supports a stronger Employer Value Proposition (EVP) by demonstrating that your company offers packages aligned with industry expectations. This is especially crucial in competitive hiring fields such as IT, finance, and e-commerce.
3. Maintaininternal pay equity
Inconsistencies in pay - especially among employees in similar roles or levels—can lead to dissatisfaction, disengagement, or even legal concerns. Pay benchmarking helps HR teams monitor and bridgethese gaps by comparing internal salaries to market rates and across departments. It also supports compliance with equal pay regulations and DEI (Diversity, Equity, and Inclusion) initiatives. A transparent pay system fosters a culture of trust and fairness.
4. Improve budget forecasting
Understanding the true market value of talent allows finance and HR teams to build more accurate salary budgets. Benchmarking helps companies set realistic salary growth assumptions, prioritize spending in high-risk or high-turnover roles, and prepare for annual reviews or expansion plans. It’s especially valuable for companies entering new markets or undergoing organizational changes, where compensation planning needs to be grounded in data.
Trends in salary benchmarking in Vietnam
Salary benchmarking in Vietnam is evolving. Employers are adopting more tailored and data-informed practices. Here are four key trends shaping the 2025 landscape:
1. Position-specific salary insights
Organizations are shifting away from using broad job titles with fixed salary bands. Instead, they now analyze compensation by functional specialization within a role. For example, “software engineer” is no longer a single category—benchmarks differ for frontend, backend, DevOps, and AI-focused roles. This micro-level approach ensures fair pay based on actual market demand and skill scarcity.
2. Geographic-based compensation
Salary levels vary significantly between cities due to differences in cost of living, talent competition, and industry activity. In 2025, businesses are increasingly applying location-based benchmarking, offering higher salaries in Ho Chi Minh City and Hanoi compared to Da Nang or Tier 2 cities like Can Tho or Hai Phong. Some employers are also adopting “location-flexible” salary bands to support hybrid or remote teams while staying competitive.
3. Skill-Based Salary Differentiation
Employers are increasingly designing compensation structures tailored to employees' skills and competencies rather than demographic factors such as age or gender. This approach ensures that salary reflects the value and relevance of an individual's skillset to the organization. For example, companies may implement skill-based pay bands or offer targeted incentives for employees who acquire in-demand technical or leadership skills, promoting fairness and performance-driven growth.
Turn salary insights into action with expert HR consulting
Salary benchmarking is essential for building competitive, fair, and data-driven compensation strategies in Vietnam. It reveals valuable insights, but turning data into strategy requires expertise. With nearly 20 years of experience in Vietnam and a presence in 75+ countries and territories, Manpower Vietnam delivers localized, world-class HR consulting services that help businesses align pay structures, improve internal equity, and enhance workforce planning.
From compensation policy design to HR benefits consulting, our tailored solutions support companies across all sectors.
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