December 10, 2024
BANGKOK – The chairmen of the Thai Chamber of Commerce (TCC) and the Joint Standing Committee on Commerce, Industry and Banking (JSCCIB) recently expressed support for improving the income levels of Thai workers but stopped short of endorsing the 400-baht nationwide increase.
TCC chairman Sanan Angubolkul said the proposal to bring the daily minimum wage to 400 baht nationwide was concerning because global and domestic economic volatility caused by geopolitical factors pose challenges for Thailand and its business sectors.
Instead, Sanan said, a more context-sensitive approach can be taken to adjust the minimum wage, taking into account the economic and social dynamics of the country and the potential impacts on various sectors.
He said the proposed uniform minimum wage does not consider the diverse economic and social conditions across different provinces. Over 90% of the provincial subcommittees on minimum wage adjustments, which include representatives from employers, employees and the government, are against this proposal, with 30% voting against any wage increase.
A significant wage hike could lead to increased production costs, reduced competitiveness and adverse impacts on employment, especially now when the economy is still in a fragile state, he said.
Businesses may respond by downsizing, freezing new hires, halting operations or shifting to informal systems, potentially resulting in layoffs, Sanan warned. He also said that Thai and foreign investors find basing themselves in Thailand unsustainable and relocate their operations to other countries.
In response, JSCCIB has come up with the following recommendations:
Basing wage adjustments on the recommendations of provincial subcommittees and adhering to economic indicators.
Utilising the Tripartite Wage Committee mechanism for wage adjustments, ensuring alignment with provincial subcommittee recommendations based on factual analyses of current wages and other economic factors.
Limiting wage adjustments to no more than once a year, based on clear economic indicators and strict legal procedures.
Conducting sector-specific readiness studies before implementing targeted wage increases to avoid disruptions in supply chains.
Supporting skill-based wages as per guidelines set by the Skill Development Promotion Committee and focusing on upskilling and reskilling workers.
Accelerating the declaration of skill-based wage standards for all 280 occupational categories under the national skill standards framework, up from the current 129 declared categories.
Implementing measures to mitigate the cost of living impacts on low-income groups and providing relief for businesses to maintain their competitiveness.