Minimum wage has not kept up with inflation: study

The minimum wage for labourers has not kept pace with the actual cost of living and inflation in the past 10 years, Labour Ministry permanent secretary Somkiat Chayawong said yesterday.

This conclusion was based on initial findings by a panel assigned by a tripartite committee to study wage increases, said Somkiat, who is the ex officio chairman of the committee.

For example, inflation was 5.6 per cent in 1997 and there was no increase in the minimum daily wage; the rate was 8.1 per cent the next year, which saw a wage hike of 1.8 per cent. There were no minimum-wage increases in 1999 or 2000, which saw inflation of 0.3 and 1.6 per cent respectively.

There were only two years in the past decade when the hike in the minimum wage was higher than inflation: 2001, when inflation was at 1.6 per cent and the hike was 2.2 per cent, and 2007, when inflation was 2.3 per cent and the pay rate rose 3.1 per cent.

The panel is tasked with working out the final figure for the next hike by November, which needs to be approved or rejected before January.

In working out the final figure, which may not reach Bt250 as proposed by Prime Minister Abhisit Vejjajiva, four conditions are to be taken into consideration. First, the increase must lift standards for labourers while not burdening employers.

The three other conditions are: the new wage rate must reflect the rate of inflation and the cost of living; cost-reduction measures will be introduced for free to employers; and skill training must be extended to new employees.

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