FTI decries labour woes

September 4, 201411:43 am336 views
FTI decries labour woes
Federation of Thai Industries

HIGH labour costs and the shortage of unskilled workers are some of the main reasons companies are relocating their production bases to neighbouring countries where production costs are lower, the Federation of Thai Industries said yesterday.

The Thai Garment Manufacturers Association (TGMA), a leading manufacturer for famous brands such as Tommy Jones, Ann Taylor and Ralph Lauren, will shut down its Prachin Buri plant by the end of this month. It has 800 employees, down from 2,000 in recent years.

TGMA will still be left with two factories in Samut Sakhon and Nonthaburi with a combined headcount of about 6,000 people.

TGMA cited the Bt300 minimum wage and the severe shortage of labour in the region as the reasons it is closing down one of its facilities.

In recent years, 30 more garment factories have fled to other countries where labour is cheaper and the Generalised System of Preferences still applies. Thailand will lose its GSP privileges in the European Union by the end of this year since it has developed into a middle-income country.

“The shortage of labour is a severe problem for industries,” said Suchart Chantaranakarach, the FTI’s vice chairman for labour issues.

“If there is not enough labour, companies will not be able to fill their orders, they will not be able to expand and by extension, gross domestic product will not expand,” he said.

The Bt300 minimum wage is much less critical than the real problem, which is the shortage of labour, he said. Since many factories are now using unskilled labour from other countries, the new government should come up with measures to regulate the number of migrant workers to make sure there are enough to meet the demand for labour.

“Even if you are willing to pay Bt350 per day for your workers, there is no worker to take that payment. Your problem will still persist,” he said.

If factories still cannot find any workers, more of them, especially smaller businesses, will close down. Since last year, more than 10 factories in various industries have ceased operations for this reason. Now there is a combined shortage of some 200,000-300,000 alien and Thai workers for all industries, and especially labour-intensive ones, such as garment and food industries, Suchart said.

Three measures

The FTI and the Joint Standing Committee on Commerce, Industry and Banking have proposed three measures to the Board of Investment to tackle the problem.

They are increasing labour skills, regulating the number of migrant workers, and extending privileges, such as lowering the corporate income tax, for operators that do not use migrant workers, for two more years.

The FTI yesterday introduced its first “Young FTI” project under the concept of “learning from experience”. It is meant to act as a platform for young entrepreneurs to meet experienced executives and share valuable ideas.

It will give young entrepreneurs a chance to learn from the successes and failures of experienced executives from corporations in various industries such as Siam Cement, Thai Beverage, PTT, Charoen Pokphand Foods and Toyota Motor.

source: nationmultimedia.com
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