Bank Of Thailand Survey Reveals Wage-Hike Fears

[webfact]

LABOUR WAGE

Survey reveals wage-hike fears

The Nation

BANGKOK: -- A Bank of Thailand survey of 257 businesspeople has found that most are concerned that next year's nationwide implementation of the Bt300 daily minimum wage will worsen labour shortage.

Once the Bt300 minimum wage comes into effect on January 1, fears are that labour-intensive industries will shift their manufacturing bases to other countries, a source at the bank said yesterday.

Ranong Chamber of Commerce chairwoman Nareumol Khoraphum yesterday said the chamber, the Ranong Industrial Office, Fisheries Association and Tourist Business Association have urged that the Bt300 minimum wage implementation be delayed until January 1, 2015, citing world economic problems, natural disasters and intense competition.

Ranong Industry Council chairman Krisana Eiumwongnathee said a daily wage of Bt220 to Bt230 was more suitable and that increasing it to Bt300 would increase the cost of raw materials, packaging and transport.

-- The Nation 2012-11-07

[jackr]

Not to politicize it, but, along with 'getting back in', guessing this was all part of T's plan to create turmoil and to siphon off a few billion when no-one's looking.

[asiawatcher]

I don't think anyone in Govt really thought it through but were simply told, do it, and the votes will roll in. Vote buying is a core issue with this Govt, at any cost. Further proof of the ineptitude of those in control of Thailand.

[Thai at Heart]

concerned that next year's nationwide implementation of the Bt300 daily minimum wage will worsen labour shortage.

Nice interpretation??????????? If companies relocate and put people out if work, labor goes up in supply, not down.

I think this month is university intern placement month isn't it. There have been dozens of useless articles all week.

[bigbamboo]

Prices have gone up significantly since the 300 baht minimum wage rise was announced. When it is implemented it will simply restore the status quo.

As for the big employers there's another corporate tax cut on the way so they needn't fret too much.

[jerrysteve]

With a measly 300 baht increase. I hope to hell everyone walks out of their jobs. & gives them the BIG FINGER! in

Especially with inflation on the rise.! The current wages are an Insult.

Edited November 7, 2012 by jerrysteve

[MoonShadow]

With a measly 300 baht increase. I hope to hell everyone walks out of their jobs. & gives them the BIG FINGER! in

Especially with inflation on the rise.! The current wages are an Insult.

I think its safe to assume that you don't have a business here.......

[nakhonandy]

With a measly 300 baht increase. I hope to hell everyone walks out of their jobs. & gives them the BIG FINGER! in

Especially with inflation on the rise.! The current wages are an Insult.

I think its safe to assume that you don't have a business here.......

I think that is an accurate assumption.

However this will hurt some employers, not so much the large companies but the small to mid level.

The principle is fine, most countries in the world have a minimum wage, the problem is implementation as usual!!

If the had staggered this over the next three years the employers would probably not complain as they would have time to restructure.

The minimum wage should then be index linked to inflation which is of course what is needed.

The employers also seem to forget/ignore that wages at present are pretty much the same as 10 years ago whereas inflation has taken costs up considerably. In other words they have profitted from the situation for the last 10 years. They need to bite the bullet and accept it and maybe use the aforementioned profits to cover the initial extra costs of this.

[stoli]

concerned that next year's nationwide implementation of the Bt300 daily minimum wage will worsen labour shortage.

Nice interpretation??????????? If companies relocate and put people out if work, labor goes up in supply, not down.

I also am trying to figure out the logic behind this statement of a labor shortage by increasing wages. Surely this is just a total mis-statement?

[Thai at Heart]

concerned that next year's nationwide implementation of the Bt300 daily minimum wage will worsen labour shortage.

Nice interpretation??????????? If companies relocate and put people out if work, labor goes up in supply, not down.

I also am trying to figure out the logic behind this statement of a labor shortage by increasing wages. Surely this is just a total mis-statement?

It's ok. It is to be totally expected from the Nation. They have some journo's who despite being able to write passable English, have the economic deductive capability of a pebble. Although, it has been widely seen in Thailand, that at times of lower demand , it pays to put the price up to maximise what revenue you can make.

I don't expect the journos to be Milton Friedman when they talk about economics, but would hope they could understand the difference between supply and demand.

[MoonShadow]

With a measly 300 baht increase. I hope to hell everyone walks out of their jobs. & gives them the BIG FINGER! in

Especially with inflation on the rise.! The current wages are an Insult.

I think its safe to assume that you don't have a business here.......

I think that is an accurate assumption.

However this will hurt some employers, not so much the large companies but the small to mid level.

The principle is fine, most countries in the world have a minimum wage, the problem is implementation as usual!!

If the had staggered this over the next three years the employers would probably not complain as they would have time to restructure.

The minimum wage should then be index linked to inflation which is of course what is needed.

The employers also seem to forget/ignore that wages at present are pretty much the same as 10 years ago whereas inflation has taken costs up considerably. In other words they have profitted from the situation for the last 10 years. They need to bite the bullet and accept it and maybe use the aforementioned profits to cover the initial extra costs of this.

I agree with your comments, however one often overlooked issue is that of wage differentials; if you simply raise the minimum wage for unskilled labour by a huge percentage, you also have to restore the differentials for most if not all staff above this. So the knock on effect on the cost of labour is already being felt by businesses and depending on the market you are in there is already resistance to any price increase. For us that has meant that we will no longer offer some services which had a small margin so in effect, the labour force shrinks.

[hgma]

i don't want to start pooking at anyone, but in all honesty.....

regular 43 bath/l

gas/electricity/school fees,rent/mortgage...motorcycle/car.................300 bath a day will "disturb" the labor intensive industry.

How about the disturbance a 150 bath a day is causing to average Thai families????????????????

Thailand want's to stage the world?

Pay!!!!!!! a decent dignified Wage!!!!!!!!!

[bigbamboo]

With a measly 300 baht increase. I hope to hell everyone walks out of their jobs. & gives them the BIG FINGER! in

Especially with inflation on the rise.! The current wages are an Insult.

I think its safe to assume that you don't have a business here.......

I think it's safe to assume he's not in the slave trade too.

[nakhonandy]

With a measly 300 baht increase. I hope to hell everyone walks out of their jobs. & gives them the BIG FINGER! in

Especially with inflation on the rise.! The current wages are an Insult.

I think its safe to assume that you don't have a business here.......

I think that is an accurate assumption.

However this will hurt some employers, not so much the large companies but the small to mid level.

The principle is fine, most countries in the world have a minimum wage, the problem is implementation as usual!!

If the had staggered this over the next three years the employers would probably not complain as they would have time to restructure.

The minimum wage should then be index linked to inflation which is of course what is needed.

The employers also seem to forget/ignore that wages at present are pretty much the same as 10 years ago whereas inflation has taken costs up considerably. In other words they have profitted from the situation for the last 10 years. They need to bite the bullet and accept it and maybe use the aforementioned profits to cover the initial extra costs of this.

I agree with your comments, however one often overlooked issue is that of wage differentials; if you simply raise the minimum wage for unskilled labour by a huge percentage, you also have to restore the differentials for most if not all staff above this. So the knock on effect on the cost of labour is already being felt by businesses and depending on the market you are in there is already resistance to any price increase. For us that has meant that we will no longer offer some services which had a small margin so in effect, the labour force shrinks.

Fair point, the knock effect is inevitable.

However in the majority of cases the higher qualified/paid personel are minimal. I was mainly referring to the small to middle businesses that are labour intensive.

The large companies in general pay above the 300B minimum already.

Again I believe if they staggered the rise over 3 years it would have made things easier.

[jonclark]

With a measly 300 baht increase. I hope to hell everyone walks out of their jobs. & gives them the BIG FINGER! in

Especially with inflation on the rise.! The current wages are an Insult.

I think its safe to assume that you don't have a business here.......

You ever tried to live on 300 baht a day with a family to feed?? I haven't, but nor would i want to either.

i don't want to start pooking at anyone, but in all honesty.....

regular 43 bath/l

gas/electricity/school fees,rent/mortgage...motorcycle/car.................300 bath a day will "disturb" the labor intensive industry.

How about the disturbance a 150 bath a day is causing to average Thai families????????????????

Thailand want's to stage the world?

Pay!!!!!!! a decent dignified Wage!!!!!!!!!

Agreed, the high levels of poverty in Thailand are the root cause of most of the problems, drugs, corruption, lack of education, prostitution etc. Put simply the masses are to preoccupied scraping together enough money to pay for rent, food, bills to worry or care about the bigger picture. Eliminate poverty and many of the other social ills shrink too.

[Soutpeel]

Pay!!!!!!! a decent dignified Wage!!!!!!!!!

Which is what exactly ?

[Thai at Heart]

http://www.nationmul...d-30193898.html

The Central Wage Commit-tee yesterday approved a Bt10 increase in part-time wages for students. From January 1, the minimum hourly part-time student wage will be Bt40.

Deputy Permanent Labour Secretary Arthit Ismo said there's no punishment for employers who fail to meet the hike but he asked for their cooperation. He said it's necessary to keep in line with the cost-of-living rise that will occur when the Bt300 daily minimum wage goes into effect nationwide on January 1.

Now I understand when a food processing factory opens in the middle of nowhere, it is rapidly followed by a college just up the road. Please someone explain to me why students are so rich that they can afford to work to get themselves through university part time at 40 baht a day?????

Who makes these dumb of dumbest of dumb regulations.

Edited November 7, 2012 by Thai at Heart

[Thai at Heart]

http://www.nationmul...d-30193898.html

The Central Wage Commit-tee yesterday approved a Bt10 increase in part-time wages for students. From January 1, the minimum hourly part-time student wage will be Bt40.

Deputy Permanent Labour Secretary Arthit Ismo said there's no punishment for employers who fail to meet the hike but he asked for their cooperation. He said it's necessary to keep in line with the cost-of-living rise that will occur when the Bt300 daily minimum wage goes into effect nationwide on January 1.

Now I understand when a food processing factory opens in the middle of nowhere, it is rapidly followed by a college just up the road. Please someone explain to me why students are so rich that they can afford to work to get themselves through university part time at 40 baht a day? or is this per hour?

I reckon if you have to work more than 4 hours a day for a company 5 days a week you should be treated as a full employee and the "company" should pay the necessary social and other contributions. At least it would clear up the clothes section in Central.

Edited November 7, 2012 by Thai at Heart

[jerrysteve]

Moonshadow: No I do not have a business here, I trade the currency markets as a profhessional trader from my computer for my own account in New York. A skill I learned on the Chicago Mercantile exchange asia floor trader umteen years.

There is no need to operate a business in Thailand, and no would I.

There are much better things to do with money, and of course there is the wholesale corruption here as well.

However, with Thailand being somewhat centered geographically in Asia, it provides a nice stepping stone to other Asian countries.

Have a great day.

[Crushdepth]

With a measly 300 baht increase. I hope to hell everyone walks out of their jobs. & gives them the BIG FINGER! in

Especially with inflation on the rise.! The current wages are an Insult.

So are current productivity levels.

[alant]

it is hard to gauge the effect of this policy on employment when combined with the increasing automation now employed in Thailand. Will there be mass unemployment? I see little alternative for the rural poor. In international competitive terms the product cost has been hit with a double whamy of a massive labour cost increase and a strong currency. 2015 is but 2 and a bit years away...

Edited November 8, 2012 by alant

[soomak]

I agree with your comments, however one often overlooked issue is that of wage differentials; if you simply raise the minimum wage for unskilled labour by a huge percentage, you also have to restore the differentials for most if not all staff above this. So the knock on effect on the cost of labour is already being felt by businesses and depending on the market you are in there is already resistance to any price increase. For us that has meant that we will no longer offer some services which had a small margin so in effect, the labour force shrinks.

You are principally correct, but not when it comes to the Thai job market.

The differences in salaries are huge in Thailand.

In most OECD countries, the median wage is 80% or more of the average wage.

I don't know the exact figure for Thailand, but it seems that the average is much much higher then the median.

For example:

Most service jobs (waitress/shop clerks/security/ 7 eleven/ lotus etc) in bkk pay 7-12,000 baht, so I would guess the median in bkk is around 12,000.

A bank clerk can make 15-18,000

A low level manager in a small bank branch can make 30,000 or more.

The branch manager can make 45,000.

And the one above him can make 60-80,000.

Making the minimum salary 300 baht per day (roughly 8,000 per month), is not going to change this very steep Pyramid.

What it will do is reduce the inefficiency a little, so everywhere you now see three people sitting around doing nothing, there will be only two.