Labour Ministry eyes 5-8% increase in minimum wages, TCC airs concern
The Labour Ministry plans to propose a 5-8 per cent increase in the minimum wage to the Cabinet in September.
Labour Minister Suchart Chomklin said on Tuesday that the increase will vary in provinces due to a difference in the cost of living. He added that it is time to boost minimum wages, especially after the hardship inflicted by the Covid-19 fallout.
“The government has helped prevent layoffs,” he said. “Now it is time for us and employers to boost workers’ morale.”
Suchart explained that the increase is based on Thailand’s gross domestic product (GDP), inflation and cost of living.
The average daily minimum wage currently stands at 336 baht.
He said steps should immediately be taken to help workers in Phuket, Bangkok and provinces in the Eastern Economic Corridor, adding that he hopes the new wage will go into effect from October 1 as many consumer goods are getting expensive.
He also said that this push for a wage increase was not a move to win votes, but was being sought to secure the country’s economy and security.
Thai Chamber of Commerce (TCC) chairman Sanan Angubolkul said the agency agreed with moves to boost the minimum wage because rising inflation has triggered a surge in the cost of living.
However, he said, the plan should be studied thoroughly from all dimensions.
“TCC agrees that wages should be increased based on the cost of living in different provinces,” he said.
However, TCC vice chairman Visit Limlurcha said the impact of rising production costs in each business sector is different.
For instance, he said, industries that consume a lot of electricity will see their costs rise higher than others. Also, he said, the increase in the minimum wage may subsequently increase the price of goods and services, thus resulting in an impact on consumers.
“Hence, it is necessary to thoroughly study the issue to ensure that workers can survive, businesses can continue operating and there is less of an impact on the economy,” he said.
Visit said the minimum wage increase will boost production costs by 5 to 20 per cent, depending on the number of workers a business has.
For instance, he said, industries that are automated may only face a 5 per cent increase in production costs.
To mitigate the impact of rising wages on the business sector, he said, the government should offer mitigating measures like supporting manufacturing technology, promoting alternative energy and giving entrepreneurs easier access to funding. He also said a National Single Window system should be developed to make it easier for businesses to apply for licences.