Survey: Wage hike to hit SMEs

Small and medium-sized enterprises can expect to be hit hard by higher costs next year, fuelled by a surge in wages of 6.2% against 5.5% in 2012.

"The real impact for Thai entrepreneurs, especially SMEs, will occur in the year to come, as the government's mandatory 300-baht daily minimum wage becomes effective nationwide and the 15,000-baht monthly starting salary for civil servants with bachelor's degrees begins," Wisarut Ruknapapong, managing director of Human Intellectual Management Co, told a seminar held by the Thailand Management Association.

"The labour market and local entrepreneurs should adjust to make sure they employ only capable persons and apply more technology," said Mr Wisarut.

"Anyone engaged in labour-intensive industry needs to relocate to Cambodia, Laos, Myanmar and Vietnam, otherwise they will not compete."

In a separate session, the Federation of Thai Industries (FTI) yesterday voiced strong opposition to the government's 300-baht wage hike.

The FTI is pushing to meet Prime Minister Yingluck Shinawatra today before a cabinet meeting in which the policy is expected to be endorsed.

"We insist on meeting the prime minister to delay the wage hike and to deter it [from cabinet endorsement] because the private sector will be drastically affected," said Thaveekit Jaturajarernkul, the FTI's vice-chairman.

"Perhaps some large businesses agreed, but most are SMEs who will face difficulties."

FTI will propose five issues to the prime minister.

First is asking the government to stick to the present minimum wage policy until Dec 31, 2015.

The second proposal is that the Provincial Subcommittee on Wages takes charge of minimum wage considerations and makes proposals to the Central Committee on Wages without being subjected to political influence.

Third, the FTI asks that those employees entitled to the minimum wage at least have a fourth-grade education and hold a graduation certificate from the Education Ministry.

Fourth, the FTI proposes that the government get rid of the minimum wage policy altogether after Dec 31 of 2015 and let wages float according to market mechanisms.

Fifth, the FTI asks that the government provide concrete compensation and rehabilitation programmes for those businesses affected by the policy.

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Writer: Phusadee Arunmas & Soonya Vanichkorn