Labour shortage looms in Thailand

Thailand will face a labour shortage next year and a mismatch of market demand and labour supply, according to Simon Matthews, country manager of ManpowerGroup, one of the world’s leading recruitment agencies. 

The group also plans to do business in Cambodia next year and is looking for business opportunities in Laos and Burma, Matthews said yesterday. 

He said he expected manufacturers in six submerged industrial parks to resume operations within the first quarter of next year. Workers who temporally lost their jobs because of the floods are expected to be re-employed. A mismatch between market demand and supply will be unresolved next year. 

The demand for sales personnel, engineers and technicians is high but supply is not adequate, while demand for those holding a bachelor’s degree in social sciences is only 15 per cent of the available supply. 

Despite the unprecedented recent floods and rising wage cost, Thailand remains attractive for investment in automobile and electronics, which require higher-skilled labour than in the textile industry, according to Matthews. He did not think the wage hike would affect these industries much. 

The government plans to increase the minimum wage to Bt300 per day in April. The Federation of Thai Industries has strongly opposed the move, fearing the high cost of labour would affect the country’s competitiveness.

Private companies are worried that labour costs will rise across the board, not only the minimum wage. 

The government also will increase the salary of newly recruited bureaucrats who hold a bachelor’s degree to Bt15,000 per month. 

Matthews said that so far there was a lack of clarity over the definition of salary or minimum wage, and whether either includes allowances. For example, a worker may get a wage of Bt250 per day and transport allowance of Bt50. It is not yet clear whether the allowance would be considered part of the worker’s salary or minimum wage, he said. 

Still, he said, he advocated that his clients conform to labour laws.

Some firms may opt to cut down their profits and raise the salaries of workers. Some may pass on the cost to consumers by increasing their product prices. Others may increase their productivity, he said.

ManpowerGroup plans to open an office in Cambodia next year, he said. 

Multinational firms and large local firms in Cambodia want to hire middle-level managers and skilled labour from Thailand, said Chong-Jua Yangthaworntrakoon, borderless talent solutions manager. 

Japanese and South Korean investors are looking into investing in Cambodia. Some want to set up factories that could make up for lost production if their manufacturing bases in Thailand are unable to operate because of natural disasters in the future, Chong-Jua said. 

He said his company also was seeking a licence to send Thai workers to work abroad next year. It plans to export labour to Cambodia, the Philippines and the Middle East. 

The Philippines needs information-technology specialists and banking personnel from Thailand while the Middle East also wants middle-level managers and specialists in some areas from this country, he said.