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NEWS UPDATES Asean Affairs           30   August  2011

Thai wages fall behind inflation

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The Thai daily minimum wage has advanced more slowly over the past decade than the average inflation rate, and 7.8 percent of Thais remain under the poverty line, says the National Economic and Social Development Board (NESDB).

Statistics show the minium wage rose by 2.3 percent annually during that period, with inflation outpacing that at 2.8 percent.

The wage hikes have barely covered laborers' living expenses. There has never been any hope of lifting their living standards.

Currently, laborers' average 205 baht a day - 176 baht as the minimum wage and 29 baht from social allowances.

The NESDB said this lags far behind the cost of living - food, rent, utilities and health care. These workers can never hope to afford a home loan, let alone entertainment and recreation expenditures.

Secretary-general Arkhom Termpittayapaisith said the real minimum wage has increased by about 1 percent per year on average, while productivity rose by 2.8 percent. "A labour shortage is looming at all levels, both skilled and unskilled, as economic improvements and growth help to change workers' outlooks for the better," said Mr. Arkhom.

Unemployment in this year's second quarter dropped to 0.56 percent from 1.3 percent in the same period last year, while the employment figure increased by 1.5 percent year-on-year.

Mr. Arkhom said if the Yingluck Shinawatra administration and private employers want to push the proposed 300-baht daily minimum wage, then more work hours and chances for overtime should be allowed.

As well, allowances for travel, meals and clothing should be increased above the present average of 29 baht a day, he said.

"The government should offer small entrepreneurs some incentives to encourage them to increase the minimum they pay, and these incentives should especially be forthcoming in the major provinces. Long-term, the government must do its part to restructure the production system to incorporate higher technology," said Mr. Arkhom.

The government think-tank also reported another 5 million people risk falling below the poverty line in the event of a new economic crisis or severe natural disaster.

Last year, 5.08 million people or 7.8 percent of the population were officially classified as poor and had monthly incomes of 1,687 baht or less.

The NESDB said the poor have only grown poorer as the income gap widened over the past 20 years. Statistics show the incomes of the 20 percent wealthiest Thais are 11 times higher than those of the 20 percent poorest.


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