13-12-2023 (BANGKOK) In a bid to address concerns over the recently approved increase in Thailand’s daily minimum wage, Prime Minister Srettha Thavisin staunchly defended the move, asserting that the adjustments would not spell disaster for business owners. The comments follow the decision by a wage committee comprised of government officials, labour representatives, and businesses to implement a modest 2.37% hike, setting the new minimum wage between 330 baht and 370 baht ($9.23 to $10.35) per day.
Expressing dissatisfaction with the committee’s decision, the prime minister addressed a business forum, stating, “This government does not agree with (that hike),” while highlighting the government’s efforts to support businesses by reducing electricity and energy prices. He emphasized the importance of ensuring that Thais have work with dignity.
The ruling Pheu Thai party, led by Srettha, had campaigned on a key populist platform, advocating for an increase in the minimum wage to 400 baht a day. The recent hike, deemed insufficient by the prime minister, comes on the heels of a 5.02% increase implemented by the previous government in October 2022.
Looking ahead, the labour minister hinted at the possibility of a more substantial minimum wage hike to be proposed later this month, though details remain undisclosed.
Despite the government’s stance, businesses have expressed apprehension over the rising costs associated with increased wages, citing concerns about competitiveness amidst sluggish economic growth. Srettha sought to allay these fears, stating, “Businesses will find that a wage hike will not be a disaster, but will have a positive effect if done properly.”
The Federation of Thai Industries, however, remains cautious, warning that businesses may bear the brunt of higher minimum wages alongside increased borrowing costs, potentially impacting the competitiveness of Thai companies.
Thailand, Southeast Asia’s second-largest economy, experienced lower-than-expected growth at 1.5% in the July-September quarter compared to the same period the previous year. This slowdown is attributed to weak exports and government spending, posing additional challenges for businesses grappling with increased costs.
