Phuket among most expensive in base wage rate increase

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PHUKET: New minimum wage rates came into effect last Sunday (April 1), with Phuket among the three most expensive provinces in the country to hire base-wage workers.


Under the new wage rates, the minimum wage in Phuket shifted from B308 to B330 per day.

The Federation of Thai SMEs Association (FTA) said the increase in minimum daily wages were a top concern for the private sector, prompting a request to the government to implement remedial measures to cushion the impact of the hike, reported Bangkok Post.

“We want to monitor any negative impacts, which take one to two months to measure, to local small and medium-sized enterprises [SMEs], which are expected to be affected by the wage hike,” said FTA President Noppong Teeravorn.

“The FTA hopes the wage hike will not create huge, negative effects for the SME sector.”

The Cabinet in late January endorsed nationwide daily minimum wage hikes of 5-22 baht.

The highest increases will occur in Phuket, Chon Buri and Rayong.

The new hike was based on an overall inflation rate of 0.4% and the country’s economic expansion.

Nonetheless, Kreingkrai Thiennukul, Vice-Chairman for the Federation of Thai Industries (FTI), said the private sector is not worried about this issue because the new wages are acceptable and were approved by the national tripartite committee.

“The FTI has agreed to the increased wages, while the maximum rate is only at B325 per day, which is only a slight increase from the existing 305-310 baht,” he said.

Leading figures in key Phuket industries in January played down the impact of the rise in the minimum wage.

“This will not have a big effect on medium to large developers in Phuket,” Watchara Jaruariyanon, CEO of Vasi Co Ltd and a key figure in the Phuket’s construction industry, told The Phuket News.

“It will affect medium to large construction projects by at least 3%, but smaller contractors will feel the effects more with prices for such projects to increase by about 5%,” he said.

Mr Watchara noted that Phuket is already among the provinces paying the highest minimum wage rates in the country – alongside Chonburi and Rayong – and that will not change.

Of note, under proposed minimum wage hike, the base wage rate in Phang Nga and Krabi provinces will rise to B320 per day.

However, Mr Watchara noted, “Phuket’s minimum wage at B330 per day will be more expensive than in any other Southeast Asian country [Note: there is no minimum wage in Singapore – Ed]. So, this will not change for any investors in the construction industry.”

Somyos Wongboonyakul, President of the Phuket Fishery Association, was full of derision for the concept of a minimum wage in Phuket.

“They [the government] never look at the reality here. Look up the cost of living in Phuket,” he said.

“We have moved so far from the original standard of B9,900 per month. The real minimum wage for any people in the fishing industry in Phuket is B11,000 per month – regardless if they are Thai, Burmese or Cambodian.

“This, the minimum wage, will not affect seafood prices in Phuket. What does affect the prices is how market vendors and other sellers mark up their margins on seafood here,” Mr Somyos added.

Courtesy: Published at The Phuket News on April 7, 2018 

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