Amid rising cost of living, household debt hits highest level in 14 years
Household debt in Thailand surged to around THB218,000 per household, the highest in 14 years, according to the University of Thai Chamber of Commerce (UTCC).
Thanawan Polvichai, director of the UTCC Centre for Business and Economic Forecasting, said that 99 per cent of people who earned a salary less than THB15,000 per month were in debt. He said the total household debt is 90 per cent of gross domestic product.
He said the indebtedness was caused by salaries not being enough to cope with the cost of living and increasing prices of products. Those who already have debts have to be careful when spending and repaying the debt. It is expected that spending on the Labour Day holiday this year will be only THB1.525 billion, down by 14.9 per cent from the previous year.
He said workers are requesting the government to increase wages to keep pace with the current cost of living. They also want the government to take care of unemployment and debt repayment. They believe the current wage is too low when compared to the increasing cost of living.
However, according to experts, increasing the daily wage to THB492 nationwide, as they have requested, might be too high because a 10-20 per cent increase in wages in a single time will be a huge burden, especially for small operators. They might lack the liquidity to increase the wages and may have to reduce the workforce instead.
He suggested that a tripartite committee in each province consider and adjust according to the situation.
