Private sector poll finds opposition to hike in minimum wage next year

Private sector poll finds opposition to hike in minimum wage next year
Late last month, Prime Minister Prayut Chan-o-cha affirmed that the minimum wage would not be increased, as doing so would require a large budget.
PHOTO: Reuters

The daily minimum wage of Bt300 (S$11.96) should be maintained next year, while any future changes should be determined on a provincial basis, according to a significant body of opinion in the private sector.

A survey by the Thai Chamber of Commerce and the Board of Trade of Thailand found that others also favoured that the determination of the minimum wage should be based on business categories and the standard of labour skills, as well as being in line with the market mechanism.

Moreover, the government should conduct a comprehensive study of the impacts of the current Bt300 wage on the economy and labour productivity, chamber vice chairman Bhumindr Harinsuit said yesterday.

The chamber offered these views based on its survey of 218 business operators nationwide from June 1 to 20, in which opinions were sought on the setting of the daily minimum wage for 2016. The survey was jointly conducted with the University of the Thai Chamber of Commerce.

Of the respondents, 47.5 per cent were in the services sector, 23.2 per cent in manufacturing, 22.2 per cent in the trade sector, and 7.1 per cent in the agricultural sector.

Most opposed raising the minimum wage soon, given the sluggish economy.

Regarding appropriate ways to determine the minimum wage, 36.5 per cent said it should be determined on a provincial basis, while 29.8 per cent said it should be determined in accordance with labour-skills standards.

According to the survey, the appropriate average daily minimum wage for current circumstances is Bt293.45.

About 89 per cent of respondents said their businesses would be negatively affected if the minimum wage were to be raised to Bt360 per day. Some 24.1 per cent said such a rise would jack up their labour costs, while 22.32 per cent said it would eat into their profits - or even result in losses.

Late last month, Prime Minister Prayut Chan-o-cha affirmed that the minimum wage would not be increased, as doing so would require a large budget.

His remark followed the demand by a group of labour activists that the minimum wage be increased from Bt300 to Bt360.

The Federation of Thai Industries recently called for the government to set up a new tripartite committee to consider changes in the minimum wage on a provincial basis, while most enterprises want to delay a wage increase amid uncertainty about recovering growth and concern over the impact of the current drought.

Meanwhile, the vice president of the Employers' Confederation of Thai Trade and Industry, speaking at a seminar yesterday on economic and employment confidence for the second half of 2015, insisted that the minimum wage should be maintained at Bt300 because of the country's economic slowdown.

A decrease in the level of exports, the Greek debt crisis, Middle East respiratory syndrome (MERS) and currency-exchange uncertainty are four factors worrying Thai businesses at the moment, said Tanit Sorat.

"Businesspeople are confused by the current situation and don't know how to plan the future direction of their enterprises. The Thai economy is maintaining the status quo, with only slight growth. Therefore, it is unlikely that Thai enterprises could increase the minimum wage at the moment," he said.

Referring to a report by the confederation, Tanit said almost 90 per cent of businesses wanted to preserve the minimum wage at Bt300 to avoid increasing their production costs.

However, the report shows that an average daily minimum of Bt310 to Bt320 would be acceptable, should there be an adjustment, he added.

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