Wage hike needs help

EDITORIAL

Published: 10 Feb 2013 at 00.00
Newspaper section: News

The 300 baht minimum wage policy the Pheu Thai Party campaigned on which has been implemented across the country since Jan 1 is one of the most contentious issues in Thailand today. On the one hand, there are those who say it will be a death knell for many labour-intensive businesses and force investors to look to neighbouring countries to set up new operations. Then there are those who point out that as the cost of living rises, the lower economic sectors are getting squeezed the hardest, and there has not been a significant minimum wage increase for a very long time.

Much of the difficulty with implementing the policy has to do with the fact that it is a relatively large increase to impose suddenly, and it also puts pressure on employers to raise wages across the board, as more skilled employees expect to earn more than inexperienced new hires. At the end of the day, however, it's hard to defend the assertion that 300 baht is too much for a full day's work. The fact is that the 300 baht minimum wage has been signed into law and backing away from it now would be disastrous in terms of social discontent and erosion of trust in government.

Therefore a report in yesterday's Business section, "Central Trading uses lean manufacturing" was encouraging. The report says that over the past two years, Central Trading Co, which manufactures mostly brand name jeans, increased workers' daily average wages from 215 baht to more than 400 baht per day through projects initiated by the Industrial Promotion Department maximise efficiency and ensure that raw materials are utilised properly. Suphot Phawachittranon, assistant vice-president for production, said: "Two years ago employees did not know how to use raw materials efficiently and also lacked teamwork skills." The greater efficiency has resulted in lower production costs, which has enabled the company to raise wages.

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spiceman
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Discussion 13 : 11 Feb 2013 at 10.0913
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Khun Oldexp #12, I can tell you for sure that the once mighty US Economy is not keeling over because the rich are not paying enough taxes. Did you know that, in the US, the top 1% income earners pay 40% of all income tax burden, and the top 10% income earners pay 70% of all income tax burden, while, the bottom 50% of income earners pay only 3% of all income tax burden. And by the way, in "pure" Capitalism, badly-run banks and businesses, like Chrysler & GM, will be allowed to fail, while their well-run counterparts will be allowed to grow and prosper. Instead, the former were rewarded for failing with free taxpayers money (bailouts).
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oldexp
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Discussion 12 : 10 Feb 2013 at 23.4512
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D9 to D11..
I criticized "The world's major economies are bankrupt and teetering on collapse because of social spending and populist policy making." But not only.
US soon bankrupt because of social spending? Got to be kidding. Populist policies (Obamacare?) can be.
The "pure" capitalists did more damage. Lower taxes for the rich, optimized company-taxes by going global, worshiping non-productive shareholder values, repaying federal debt & helping the export by bringing the $ down ....
D9, D11 arguments are true. My critic about democracy would simply be: Most of the people are stupid and the majority wins.
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boons
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Discussion 11 : 10 Feb 2013 at 20.4611
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D9: I could swear that was Alexander DeToqueville in "Democracy in America" and not Alexander Tytler ... no? Anyway... I completely agree. Voting for handouts from the Treasury is the road to ruin for all democracies. History is littered with the wreckage of populist experiments that stand testament to this truth. Democracies are originally established to create equal RIGHTS not an equality of benefits. But the common realities of popular elections swiftly turn towards a public pillaging of government coffers, and worse the creation of public debt -- which is always the beginning of a nation's death spiral.
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spiceman
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Discussion 10 : 10 Feb 2013 at 19.3810
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Khun Oldexp #7, please, do yourself a big favor by looking up "Cycle of Democracy" by Alexander tytler (1747-1813).
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spiceman
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Discussion 9 : 10 Feb 2013 at 19.009
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Khun Oldex #7, there is no accident why Greece, Spain, Portugal, Ireland, France, and even the USA are bankrupting. Alexander Tytler (1747-1813) predicted over 200 years ago, that all democracies are doomed to fail. He said "A democracy cannot exist as a permanent form of Govt. It can only exist until the voters discover they can vote themselves largess from the public treasury. From that moment on, the majority always votes for candidates promising them the most benefit, from the public treasury, with the result that a democracy will always collapse over loose fiscal policy,..." Hope this helps!
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ledme
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Discussion 8 : 10 Feb 2013 at 17.388
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I think the best way : don"t make any comments any moore,and don"t start to think
with your brain than you are a real thai: all your comments is a waste of your time
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oldexp
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Discussion 7 : 10 Feb 2013 at 14.487
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@boons... your mathematical argument has its ugly truth. Ugly for the low incomes.
Your argument about why the world's major economies are bankrupt is one-sided BS. They are not broke because of social spending and populist policies only.
They are broke because of wrongly implemented social policies and simple greed.
Greed for money and power of the upper 1%.
Having Billions on bank-accounts, Hedge-funds that ruin economies with their wealth and more of the so called free market instruments is simply disgusting and steals money from the economies.
Also one-sided, I know.
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boons
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Discussion 6 : 10 Feb 2013 at 12.476
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d3: As long as you've decided to completely disregard mathematical and economic reality, why stop at just 300 baht per day? Why not pay them American or European salaries? Why not give them healthcare, pensions, year-end bonuses and free education too? Why are you so stingy? What's holding you back?

Yours is an emotional argument not a logical one. One which very swiftly devolves into mathematically impossible exercises in social engineering. We know how this ends. The world's major economies are bankrupt and teetering on collapse because of social spending and populist policy making. Wealth by decree does not work.
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dao
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Discussion 5 : 10 Feb 2013 at 12.265
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I think people have a problem with the way it was implemented .It should have been gradual to reduce the impact on SMEs.
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boons
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Discussion 4 : 10 Feb 2013 at 10.364
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> "however, it's hard to defend the assertion that 300 baht is too much for a full day's work"

That was a fantastic leap in logic. You began the Op/Ed with a straightforward itemization of the mathematical reasons the wage hike is a disaster. And then you transitioned into illogical, "feel good" faux-economics.

It is you, dear writer who must defend the above quoted statement. 300 baht may *well* be far too much for a day's work. This is a question of mathematics and competitive labor prices in neighboring nations.

Is 100 baht too low for Cambodian workers? Because the market says otherwise.
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Wage hike needs help | Bangkok Post: opinion