Labour Shortage In Thailand Worries Builders, Developers

[webfact]

PROPERTY SECTOR

Labour shortage worries builders, developers

SOMLUCK SRIMALEE

THE NATION

Pruksa's chief shows how real-estate manufacturing technology can help shorten construction period even with fewer workers on site

BANGKOK: -- Business operators in the construction and property-development sectors foresee a big challenge in the year ahead: It will be difficult to find workers even when the daily minimum wage rises to Bt300 nationwide.

Labour shortage tops the list of business risks for property and construction firms in 2013. To consumers, this could mean longer construction periods while they wait to take possession of their new homes.

With a low unemployment rate of 0.6 per cent, or only 232,400 jobless, the situation is grave. The construction, infrastructure and manufacturing sectors are now facing a shortfall of about 200,000 workers. They expect the situation to worsen next year when the government's infrastructure projects are kicked off, which will lead to skyrocketing demand for workers.

To ease the situation, Housing Business Association president Issara Boonyoung said his organisation had asked the Labour Ministry to relax the rules on employment of foreign labour. Foreigners' entry to the Thai labour market should be facilitated, and they should be allowed to relocate once they are here.

"As we have many construction sites, so workers should be allowed to move around," he said.

According to the National Economic and Social Development Board, there are about 2 million foreign workers in Thailand, mostly from Myanmar, Laos and Cambodia.

After enduring the labour shortage for some time, some property companies have resorted to technology. Pruksa Real Estate has moved towards prefabrication, for example. Others have modified the construction process so that fewer skilled workers are needed.

The labour situation is aggravated by the continued expansion of the property sector as it enjoys a 10-per-cent annual increase in housing demand. Each year, about 80,000 residential units are launched in Bangkok and the peripheral provinces alone. In other provinces nationwide, 150,000 units hit the market each year.

"This problem will worsen in 2013 when the government's infrastructure projects worth at least Bt500 billion start. This will attract labour away from private projects to public projects, as some are in the workers' provinces or nearby. This will affect both the real-estate and construction industries," Issara said.

The government is scheduled to announce the bidding results for its Bt350 billion worth of water-management projects early in the new year and construction should start shortly after that. Meanwhile, a portion of the Bt2.2 trillion worth of infrastructure projects planned for 2013-20 will be put to tender next year.

Thailand is among the few countries with an unemployment rate below 1 per cent, compared with nearly 30 per cent in Spain and Greece and nearly 8 per cent in the United States. A low fertility rate coupled with growing labour demand in the agricultural sector has exacerbated the situation, as the workforce has not increased much. In the third quarter of this year, agricultural-sector employment rose 3 per cent from the same period last year as farmers expanded rice-plantation areas.

SUBHEAD

Bank of Thailand data showed that in September alone, employment in the agricultural sector expanded by 6.3 per cent but employment in the non-farm sector contracted 2.7 per cent, mainly because of fewer jobs at hotels and restaurants. In the manufacturing sector, export-oriented factories reduced their workforce but those focusing on the domestic market employed more workers.

The data also showed that the labour market had tightened. The number of employed as of September stood at 39.2 million, up 0.7 per cent from the same period last year. Average pay also rose by 7.9 per cent.

The central bank's Labour Sourcing Difficulty Index in the month was below 50, indicative of business operators' hardship in sourcing workers.

Thongma Vijitphonpun, chief executive officer of leading firm Pruksa Real Estate, said property companies had to develop innovations to reduce the number of staff needed to develop residential projects.

He believes that the labour shortage will continue to be the main problem for the industry, especially once the Asean Economic Community becomes effective in a couple of years. This will move labour to other countries in the region even though Thailand's minimum daily wage will increase to Bt300 nationwide next month.

"The problem facing our industry is not the increased minimum wage, because we pay more than the minimum. The problem is that we cannot find the skilled labour to run our business if we cannot find an innovative system," he said.

For this reason, the company has designed a real-estate manufacturing system to support the growth of its business. "It's our policy to develop at least 15,000 residential units a year," Thongma said.

-- The Nation 2012-12-03

[noitom]

Any statistics articulated by Thailand are always questionable, the utilization of illegal migrant workers in Thailand is rampant, the pay rates, benefits(insurance, workers accident..etc.) , and working conditions are abominable.

[fareastguy]

Give China a couple of years to complete the build of their new factories in Myanmar, Laos, Vietnam & Cambodia & all the Thai slave labour will have gone home.

This in conjunction with Japanese firms building new car plants over here who will want to work all day on a building site in the baking sun for a miserable Bt300.. not any Thai folks !!

Solve that one Yingluk !!

[jackr]

Thailand is among the few countries with an unemployment rate below 1 per cent, compared with nearly 30 per cent in Spain and Greece and nearly 8 per cent in the United States.

Said countries don't typically have 5 foot-shufflers doing a one-man job.

[Pormax]

The Thai unemployment statisticsare laughable. How do they know. There is not to my knowledge unemployment offices and definetely no unemployment benefits to sign for, so how can figures be given.

There isa lot more employment than the government wants you to believe especially in the North and North East.

Perhaps if decent training, reasonable wagesand better working conditions were bought in, then the construction industry would not have this problem.

But the problem is not just the meagre wage of 250B per for the ladies and 300 to 350B per day for men for an 8 hour day, and the conditions they have to put up with (sleeping on site in a tin hut)but also the problem of actually getting paid. Recently some people from my village went to work in Rayong, building houses, and they had a big problem just getting the 'boss' to pay for the days they worked. I would say that properly trained skilled workers are a problem in Thailand as most of those that work on building sights do a bit of this and a bit of that (and not very well) More training facillities are required for specialised trades.

[angsta]

The title should be cheap labour shortages not labour shortages. You think these guys are working of a profit margin that small? Get real.

[Ricardo]

I thought the water-management projects were supposed to have been carried-out this year, in time for the just-ending wet-season, wouldn't doing it next year require another 350 billion-baht budget ? So what happened to this year's cash ?

It certainly would help if, rather than the usual rush to spend the last of the sums budgeted, government-departments could carry them over, to the following year ! But that would mean fewer silly unjustified 'jollies'.

Agree with Pormax that Thai unemployment figures simply aren't true, it always cracks me up, when foreign governments point to low-unemployment here as a sign of how well the Thai economy is doing.

Perhaps its time to allow unemployed Spaniards & Greeks to come here to work, visa/regulation-free, in order to solve this 'labour shortage' ?

[jonclark]

Pruksa's chief shows how real-estate manufacturing technology....

Sorry - But is he pointing to bamboo scaffolding to indicate "manufacturing technology"

[pedro01]

The title should be cheap labour shortages not labour shortages. You think these guys are working of a profit margin that small? Get real.

Agreed

Concepts of supply and demand must be lost on him. Start paying 1000 Baht a day and you'll have plenty of builders.

How about making them employees too? Giving them benefits, paid vacations, training.

[jbrain]

Pruksa's chief shows how real-estate manufacturing technology....

Sorry - But is he pointing to bamboo scaffolding to indicate "manufacturing technology"

I guess that is an indication about how serious we should take the whole article.

[Thai at Heart]

These guys don't know how lucky they have had it.

Has anyone actually seen the conditions in which these guys live during construction? Other than the very cream of companies, being housed in a tin shack in mud and squalor is hardly a very attractive prospect.

I wonder what the word for portakabin is in Thai.

[Mosha]

These guys don't know how lucky they have had it.

Has anyone actually seen the conditions in which these guys live during construction? Other than the very cream of companies, being housed in a tin shack in mud and squalor is hardly a very attractive prospect.

I wonder what the word for portakabin is in Thai.

Tin Shack is a Thai portakabin.

[h90]

The title should be cheap labour shortages not labour shortages. You think these guys are working of a profit margin that small? Get real.

Agreed

Concepts of supply and demand must be lost on him. Start paying 1000 Baht a day and you'll have plenty of builders.

How about making them employees too? Giving them benefits, paid vacations, training.

there won't be more worker but less projects....so it would be in balance again....

[Hugo6]

solution

pay the greek and spanish 300/day in thailand

[weegee]

The Thai unemployment statisticsare laughable. How do they know. There is not to my knowledge unemployment offices and definetely no unemployment benefits to sign for, so how can figures be given.

There isa lot more employment than the government wants you to believe especially in the North and North East.

Perhaps if decent training, reasonable wagesand better working conditions were bought in, then the construction industry would not have this problem.

But the problem is not just the meagre wage of 250B per for the ladies and 300 to 350B per day for men for an 8 hour day, and the conditions they have to put up with (sleeping on site in a tin hut)but also the problem of actually getting paid. Recently some people from my village went to work in Rayong, building houses, and they had a big problem just getting the 'boss' to pay for the days they worked. I would say that properly trained skilled workers are a problem in Thailand as most of those that work on building sights do a bit of this and a bit of that (and not very well) More training facillities are required for specialised trades.

I agree with you....BUT You cant ever have benefits in Thailand....then they would all be on the dole, leaving no workers at all....lol. Take a look at Os.

Face it, as most will confirm looking at it....Starting work between 9am and 10am with 2 hrs for sleeping at lunch, and then going home at 3.30pm that day, then claiming 8hrs pay....no wonder the industries are moving elsewhere. What people here want, is no work with high pay. It is such a breath of fresh air when you can come across a worker who knows his job, is motivated, doesnt drink while he works, and shows up more than 2 days in a row.....300baht is, most of the time, too much for what is produced in a day, by one person in Thailand.....and the world outside Thailand realises it.

More proper training...yes....dole.....no.

Hope i read your post correct Pormax.

[Thai at Heart]

The Thai unemployment statisticsare laughable. How do they know. There is not to my knowledge unemployment offices and definetely no unemployment benefits to sign for, so how can figures be given.

There isa lot more employment than the government wants you to believe especially in the North and North East.

Perhaps if decent training, reasonable wagesand better working conditions were bought in, then the construction industry would not have this problem.

But the problem is not just the meagre wage of 250B per for the ladies and 300 to 350B per day for men for an 8 hour day, and the conditions they have to put up with (sleeping on site in a tin hut)but also the problem of actually getting paid. Recently some people from my village went to work in Rayong, building houses, and they had a big problem just getting the 'boss' to pay for the days they worked. I would say that properly trained skilled workers are a problem in Thailand as most of those that work on building sights do a bit of this and a bit of that (and not very well) More training facillities are required for specialised trades.

I agree with you....BUT You cant ever have benefits in Thailand....then they would all be on the dole, leaving no workers at all....lol. Take a look at Os.

Face it, as most will confirm looking at it....Starting work between 9am and 10am with 2 hrs for sleeping at lunch, and then going home at 3.30pm that day, then claiming 8hrs pay....no wonder the industries are moving elsewhere. What people here want, is no work with high pay. It is such a breath of fresh air when you can come across a worker who knows his job, is motivated, doesnt drink while he works, and shows up more than 2 days in a row.....300baht is, most of the time, too much for what is produced in a day, by one person in Thailand.....and the world outside Thailand realises it.

More proper training...yes....dole.....no.

Hope i read your post correct Pormax.

What on earth are you prattling on about.....

Believe it or not, lots of stuff gets built quite competently in Thailand.

[KuhnPaen]

They need to run an ad in Mexico

[asiawatcher]

The time it takes to build is the issue as well. Throughput would make a huge difference to profits. Average house build here is 6 - 12 months. Their project management skills stink. They have not heard of JIT ordering, certainly do not used qualified skilled labour (simply labour), they have never heard of CPA and QC is non existent. Having built a ton of properties back home, an average 250 sq m home from the time we cut the block to the time we had keys to the owner was 7-9 weeks pending fitout accessories. Having seen Malaysia doing the same crap as here, such as brick the outer walls, then ask where the power outlets go, and they come back with jack hammers and smash it out, is typical as is build the house in the mud etc then bring in the road and connect up 12 months down the line, delays at every turn. Saying there are more jobs than labour to fill, just look at street corners and compare. Motorbike guys lolling around all day with orange jackets, getting 500+ and doing SFA. Kinda makes you wonder why they don't really need to do much more for the money on offer.

[dcutman]

Pruksa's chief shows how real-estate manufacturing technology....

Sorry - But is he pointing to bamboo scaffolding to indicate "manufacturing technology"

Spot on.

Thais will never know modern building technology. Because, it is done now the way it always has been, and how it will always be done in the future, mindset.

[Pdaz]

Yep I'd love to import a German or Skandi factory built prefab house. Choose exacty what you want online, interior finishes, power points etc etc. Then half dozen skilled fellas and a crane can have it up and weatherproof in a couple of days. Then just a case of finishing it off. Wonder what the shipping costs and import taxes are ? Might actually be cheaper and less hassle than dealing with a bunch of clueless, greedy Somchais. Would only need slome land and a decently poured concrete slab.

[philw]

The time it takes to build is the issue as well. Throughput would make a huge difference to profits. Average house build here is 6 - 12 months. Their project management skills stink. They have not heard of JIT ordering, certainly do not used qualified skilled labour (simply labour), they have never heard of CPA and QC is non existent. Having built a ton of properties back home, an average 250 sq m home from the time we cut the block to the time we had keys to the owner was 7-9 weeks pending fitout accessories. Having seen Malaysia doing the same crap as here, such as brick the outer walls, then ask where the power outlets go, and they come back with jack hammers and smash it out, is typical as is build the house in the mud etc then bring in the road and connect up 12 months down the line, delays at every turn. Saying there are more jobs than labour to fill, just look at street corners and compare. Motorbike guys lolling around all day with orange jackets, getting 500+ and doing SFA. Kinda makes you wonder why they don't really need to do much more for the money on offer.

Glad that you are watching Asia so well........

Welcome.

[philw]

Pruksa's chief shows how real-estate manufacturing technology....

Sorry - But is he pointing to bamboo scaffolding to indicate "manufacturing technology"

Spot on.

Thais will never know modern building technology. Because, it is done now the way it always has been, and how it will always be done in the future, mindset.

Funny how bamboo scaffolding is successfully used throughout South East Asia...........

Maybe because it works ???

[philw]

I thought the 300 baht daily wage was going to create massive unemployment, incurable inflation and the destruction of the economy, according to some on here..................

Now we have not enough workers and build quality might be going up.

Gotta love Thaivisa.

[Pormax]

The Thai unemployment statisticsare laughable. How do they know. There is not to my knowledge unemployment offices and definetely no unemployment benefits to sign for, so how can figures be given.

There isa lot more employment than the government wants you to believe especially in the North and North East.

Perhaps if decent training, reasonable wagesand better working conditions were bought in, then the construction industry would not have this problem.

But the problem is not just the meagre wage of 250B per for the ladies and 300 to 350B per day for men for an 8 hour day, and the conditions they have to put up with (sleeping on site in a tin hut)but also the problem of actually getting paid. Recently some people from my village went to work in Rayong, building houses, and they had a big problem just getting the 'boss' to pay for the days they worked. I would say that properly trained skilled workers are a problem in Thailand as most of those that work on building sights do a bit of this and a bit of that (and not very well) More training facillities are required for specialised trades.

I agree with you....BUT You cant ever have benefits in Thailand....then they would all be on the dole, leaving no workers at all....lol. Take a look at Os.

Face it, as most will confirm looking at it....Starting work between 9am and 10am with 2 hrs for sleeping at lunch, and then going home at 3.30pm that day, then claiming 8hrs pay....no wonder the industries are moving elsewhere. What people here want, is no work with high pay. It is such a breath of fresh air when you can come across a worker who knows his job, is motivated, doesnt drink while he works, and shows up more than 2 days in a row.....300baht is, most of the time, too much for what is produced in a day, by one person in Thailand.....and the world outside Thailand realises it.

More proper training...yes....dole.....no.

Hope i read your post correct Pormax.

What on earth are you prattling on about.....

Believe it or not, lots of stuff gets built quite competently in Thailand.

The article was about unemployment figures and shortage of labour and that is what my reply was about.

However if you want an opinion on the competence of Thai builders in genereal then ok, I think you are wrong.

Some things are built reasonably well but a lot are not and nowhere near to the standard one would expect in many countries, this can easily be seen by the naked eye when one looks around. For example electrical wiring.

[Pormax]

The Thai unemployment statisticsare laughable. How do they know. There is not to my knowledge unemployment offices and definetely no unemployment benefits to sign for, so how can figures be given.

There isa lot more employment than the government wants you to believe especially in the North and North East.

Perhaps if decent training, reasonable wages and better working conditions were bought in, then the construction industry would not have this problem.

But the problem is not just the meagre wage of 250B per for the ladies and 300 to 350B per day for men for an 8 hour day, and the conditions they have to put up with (sleeping on site in a tin hut)but also the problem of actually getting paid. Recently some people from my village went to work in Rayong, building houses, and they had a big problem just getting the 'boss' to pay for the days they worked. I would say that properly trained skilled workers are a problem in Thailand as most of those that work on building sights do a bit of this and a bit of that (and not very well) More training facillities are required for specialised trades.

I agree with you....BUT You cant ever have benefits in Thailand....then they would all be on the dole, leaving no workers at all....lol. Take a look at Os.

Face it, as most will confirm looking at it....Starting work between 9am and 10am with 2 hrs for sleeping at lunch, and then going home at 3.30pm that day, then claiming 8hrs pay....no wonder the industries are moving elsewhere. What people here want, is no work with high pay. It is such a breath of fresh air when you can come across a worker who knows his job, is motivated, doesnt drink while he works, and shows up more than 2 days in a row.....300baht is, most of the time, too much for what is produced in a day, by one person in Thailand.....and the world outside Thailand realises it.

More proper training...yes....dole.....no.

Hope i read your post correct Pormax.

Ye you did read my post correctly.

I was not advocating unemployment benefit in Thailand, even these are manipulated by goverments to make figures more acceptable. All I was saying is that the Thai goverment hasn't a clue as to what the real unemployment levels as they do not have anything to work on to support their statistic, and that one of the reasons for labour shortage for the building industry is down to poor working conditions and low salaries together with insufficient amount of skilled tradesmen.

I don't though agree that most Thais are lazy and do not deserve their 300B a day as you seem to imply. There again no way would I be motivated to work hard and do a good job for that sort of pay

(even for an hours work).

Edited December 3, 2012 by Pormax

[Thai at Heart]

The Thai unemployment statisticsare laughable. How do they know. There is not to my knowledge unemployment offices and definetely no unemployment benefits to sign for, so how can figures be given.

There isa lot more employment than the government wants you to believe especially in the North and North East.

Perhaps if decent training, reasonable wagesand better working conditions were bought in, then the construction industry would not have this problem.

But the problem is not just the meagre wage of 250B per for the ladies and 300 to 350B per day for men for an 8 hour day, and the conditions they have to put up with (sleeping on site in a tin hut)but also the problem of actually getting paid. Recently some people from my village went to work in Rayong, building houses, and they had a big problem just getting the 'boss' to pay for the days they worked. I would say that properly trained skilled workers are a problem in Thailand as most of those that work on building sights do a bit of this and a bit of that (and not very well) More training facillities are required for specialised trades.

I agree with you....BUT You cant ever have benefits in Thailand....then they would all be on the dole, leaving no workers at all....lol. Take a look at Os.

Face it, as most will confirm looking at it....Starting work between 9am and 10am with 2 hrs for sleeping at lunch, and then going home at 3.30pm that day, then claiming 8hrs pay....no wonder the industries are moving elsewhere. What people here want, is no work with high pay. It is such a breath of fresh air when you can come across a worker who knows his job, is motivated, doesnt drink while he works, and shows up more than 2 days in a row.....300baht is, most of the time, too much for what is produced in a day, by one person in Thailand.....and the world outside Thailand realises it.

More proper training...yes....dole.....no.

Hope i read your post correct Pormax.

What on earth are you prattling on about.....

Believe it or not, lots of stuff gets built quite competently in Thailand.

The article was about unemployment figures and shortage of labour and that is what my reply was about.

However if you want an opinion on the competence of Thai builders in genereal then ok, I think you are wrong.

Some things are built reasonably well but a lot are not and nowhere near to the standard one would expect in many countries, this can easily be seen by the naked eye when one looks around. For example electrical wiring.

suggesting utter incompetence is not realistic either.

And yes at 301 baht a day cash, no social, no safety equipment, and a tin hut for accommodation they can't get labour it seems.

Welcome to the real world. They are all back on the farm planting rice.

[oldsailor35]

It appears that Thai employers like to pay the very minimum of wages, and then complain (whinge) that they cannot get workers. Before my retirement, i employed carpenters in high rise construction in Brisbane and the Gold Coast.

When others were having difficulty getting labour, i never had this problem. I always paid above the award rate and always made sure that i had the best tradesmen. But i guess.......... "try telling that to a Thai employer"

[dcutman]

Well Phil

I was not only talking about the bamboo scaffold. I was talking about construction methods in general. As for bamboo scaffold I have no problems with them if built properly. What we are looking at here and what we see all over Thailand is not an efficient work platform not to mention very unsafe. The idiots that built this disaster (looks like the painting crew) probably took five time longer to accomplish there goals and sure slopped paint on everything, than setting up something they could actually work on.

[dcutman]

@Thai at Heart

"They are all back on the farm planting rice"

I believe this is the problem, they are farmers, they are not tradesman, they have little or no skills in any particular trade except for digging holes. They learn from people with slightly better skills, but the teacher is not a journeyman in any trade.

This is what my experience and observations have been anyway.

Edited December 3, 2012 by dcutman

[Thai at Heart]

@Thai at Heart

"They are all back on the farm planting rice"

I believe this is the problem, they are farmers, they are not tradesman, they have little or no skills in any particular trade except for digging holes. They learn from people with slightly better skills, but the teacher is not a journeyman in any trade.

This is what my experience and observations have been anyway.

There are some ok ones, but hard to find.

But a previous post about about everything in Thailand getting c**p is pointless.

The companies are cheaper than cheap and bear little or no responsibility to repair their rubbish constructions. Techniques and materials are just starting to change from the very basic.