Move Forward claims that the present minimum wage is insufficient to meet employees’ basic requirements, especially given the rising cost of living and the economic effects of the COVID-19 pandemic.
Concerns have been raised by members of the Federation of Thai Industries (FTI) regarding the Move Forward party’s proposal to raise the minimum wage to 450 baht per day. Businesses and employees have responded differently to the Move Forward Party’s proposal to raise the minimum wage to 450 baht per day. Others worry that it would result in greater expenses, job losses, and the closure of small and medium-sized businesses (SMEs), while some see it as a method to increase the spending power of low-income people and stimulate the economy.
Concerns have been raised by members of the Federation of Thai Industries (FTI) regarding the Move Forward party’s proposal to raise the minimum wage to 450 baht per day.
To give them time to make adjustments, businesses prefer that the minimum wage be raised gradually rather than all at once.
The alliance led by Move Forward signed an MoU that calls for the elimination of all monopolies, encouragement of fair competition, agrarian reform, increased electricity generation, and the development of an extensive welfare system.
Why does Move Forward want the minimum wage to increase?
Move Forward claims that the present minimum wage is insufficient to meet employees’ essential requirements, especially in light of the rising cost of living and the financial effects of the COVID-19 pandemic. According to the party, increasing the minimum wage will increase domestic consumption, spur economic expansion, and lessen social issues like crime and drug misuse.
The party also cites foreign studies that demonstrate that, as long as it is done gradually and sensibly, raising the minimum wage does not inevitably result in the loss of jobs or inflation. The party notes that compared to many other nations in the area, Thailand has a lower minimum salary.
How do companies respond to this proposed policy?
Businesses who believe it will raise labor expenses and reduce their ability to compete in both domestic and foreign markets have expressed their opposition to this policy idea. Additionally, they foresee that it will compel them to lay off employees, shorten working weeks, or move their operations to less expensive nations.
For instance, according to Supant Mongkolsuthree, chairman of the Federation of Thai Industries (FTI), raising the minimum wage by 64 baht a day would increase employers’ annual labor costs by 192 billion baht. He claimed that many small and medium-sized businesses (SMEs) would find this to be too much to bear, particularly in industries like manufacturing, tourism, and agriculture.
Boonchoo Saisakpong, CEO of the Trang Seafood Company, had a similar worry and recommended that the new administration raise the minimum wage gradually to lessen the financial burden on enterprises.
The Thai Chamber of Commerce (TCC) has also expressed objection to the program, claiming that it would harm SMEs, which make up more than 80% of all enterprises in the nation and employ 12 million people. According to the TCC, SMEs’ labor costs would rise by 18.9% as a result of the minimum wage increase, cutting into their earnings by 6.5%. The TCC suggests that rather than artificially inflating wages, the government should concentrate on enhancing worker productivity and skill.
On the other side, some labor organizations have praised the decision, claiming that it will raise workers’ standards of living and uphold their dignity. They contend that the present minimum wage has not kept up with inflation and economic growth over the years and is too low to cover the rising cost of living. Additionally, they draw attention to the fact that Thailand’s minimum wage is lower than that of some of its neighbors, including Vietnam and Cambodia.
