Postpone 2016 minimum wage hike until second half: survey
Given high competition, fewer purchase orders and limits to price rises, most business operators want a rise in the minimum wage put off to the latter half of next year, according to the Employers’ Confederation of Thai Trade and Industry (ECONTHAI).
Meanwhile Thailand’s jobless rate will reach a five-year high of 0.916 per cent this year, according to a survey by the business lobby.
In its recent annual survey on business operations and confidence in employment, three-fourths of the operators surveyed wanted to postpone increases in the daily minimum wage to at least the second half of 2016 as the business environment were not supportive, and the rest remained uncertain.
The Thai economy was weaker than expected this year and this situation is expected to continue to at least mid-2016, the survey found. Exports in 2015 shrank for the third consecutive year to 5.2 per cent. Imports also contracted for the second consecutive year to 11.5 per cent.
If the minimum wage is raised, a tripartite system should be employed so that the minimum is not equal across the country, the survey respondents said.
The survey suggests minimum wage rates in a range of Bt310-Bt320 per day, while asking the government to develop labour skills. The wages should be subject to skill levels.
Based on the survey, the 2015 unemployment rate rose to a five-year record to 0.916 per cent, above the past average of 0.7 per cent. According to the Social Security Office, those receiving unemployment benefits in 2015 averaged 121,215 persons per month, also rising to a five-year high of 10.82 per cent.
As the private sector tends to absorb fewer workers and there is remaining production capacity, slowdown of new workforce’s acceptance is expected. Thus, the unemployment rate is forecast at 1.0 per cent in 2016.
In 2015, the number of applications to terminate business operations was the highest since 2013. In the first 10 months of this year, about 14,000 operations were registered for termination on expectation of 16,800 for the whole year.
The number of those with this year’s work termination came highest in three years to 82,700. Last year, those terminated work totaled 67,029. Those quitting work this year also hit a four-years high of 565,232.
The survey found that most business operators retained a policy of keeping their workers, and about 51 per cent planned to pay a year-end bonus of 1-1.5 times their employees’ monthly salary. Large plants might pay bonuses of two times or more. About 10 per cent of respondents would not give a bonus.
About 75 per cent of operators surveyed would keep maintain their current workforce, while 13 per cent might lay off employees next year.
Half of the operators surveyed were not confident that the economy would improve, while 30 per cent believed the economy would get better next year. About 20 per cent expected a steady economic situation.
