The Wage Committee has approved a proposal to increase the minimum wage by THB5-10/day in 69 provinces, and keep it unchanged in eight provinces, i.e., Sing Buri, Chumphon, Nakhon Si Thammarat, Trang, Ranong, Narathiwat, Pattani, and Yala. If the new rate gets approval from the Cabinet, it will go into effect beginning January 1, 2017. However, the Thai Labour Solidarity Committee (TLSC) views that this adjustment is not in line with rising living costs, therefore, they have proposed that the minimum wage be raised to THB360/day nationwide.
KResearch views that the Wage Committee's proposal of new minimum wage increasing at an average of 1.8 percent will partially ease living cost burdens for low-wage consumers over rates that went into effect after the last increase three years ago. In September, the low-income earners' cost of living based on headline inflation had risen 1.5 percent over December 2013 (when the minimum wage was increased to THB300/day nationwide). This caused business costs to increase at an average of 0.7 percent, depending on how much they rely on minimum-wage workers. However, the new rate will have only a small impact on headline inflation for 2017, which is expected to rise 0.03 percent, and only a slight effect on private consumption and the GDP next year.
However, to tackle the minimum wage issue over the long term, workers may consider enhancing their skills, improving their proficiency and quality in their work to raise their earnings over the minimum wage. Also, businesses may elevate their production to produce goods that have higher value in line with workers' attempts to improve their job skills.
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