MICE sector 'hit hard' by wage hike
The increase in minimum wage to Bt300 is affecting the meetings, incentives, conventions and exhibitions (MICE) sector by slashing profitability, according to Pravit Sribanditmongkol, president of Thailand Exhibition Association.
The exhibitions business, in particular, has been hit to a large event, he said, adding that overall margin had dropped 6-7 per cent because of the higher labour cost. Overall, operating costs had gone up by 20 per cent. The exhibition business varies from logistics to booth organising.
At the same time, the business also faces a shortage of skilled labour. However, Pravit, also executive director of Kingsmen CMTI Co, said the firm had to undergo a cost-savings programme by increasing the productivity of its existing staff. A lack of seasoned labour is one of the major problems in the MICE business at a time when Thailand is working harder to promote itself as a regional hub in 2015 when the Asean Economic Community (AEC) will be implemented.
Some have raised concerns that the inflow of foreign professional staff under the AEC could hurt Thai workers. However, the advantage is that local companies will have more choice in selecting foreign professionals to work with.
Meanwhile, the Thailand Convention and Exhibition Bureau (TCEB) yesterday teamed up with organisations to groom professionals to serve its business in preparation for the AEC. They signed a memorandum of understanding that included the Department of Tourism of the Ministry of Tourism and Sports, Thailand Incentive and Convention Association, the Thailand Exhibition Association, and Convention Promotion Fund.
Thongchai Sridama, the TCEB’s acting president, said it was not only to increase the capability of Thai operators in this industry, but also to help enhance its standardisation internationally. Most of them agreed that Thailand was second to none in the region, but the major problem was the lack of ability in the English language.
Thailand is considered an MICE destination in the region. The reasons include its good geography, infrastructure and, importantly, variety of tourism products. Even an increase in minimum wage has not seen any impact on its competitiveness.
By 2015, according to the TCEB, it is estimated that there will be about 958,000 foreign travellers coming to Thailand for MICE purposes, pouring about Bt78.71 billion into the local economy. This year, the number is projected to be 750,000, generating Bt60.12 billion.
