Labour shortage looms

Too few workers, industry squeezed     

 Bangkokpost, April 10th, 2012 - Some Thai businesses feel besieged just as the minimum wage was hiked because a possible labour shortage looms with Myanmar opening its economy.

The construction, fishery and food industries will be the hardest hit as they rely heavily on migrant workers from Myanmar.

Visit Limprana, president of the food-processing industry club at the Federation of Thai Industries, said the sector is short 20,000 to 30,000 workers, although hundreds of thousands of Myanmar labourers are already employed.

Many migrant labourers work in Samut Sakhon where several labour-intensive food factories are located, said Mr Visit, who is also managing director of Nguan Soon Group.
"I'd say all factories are facing a labour shortage. No matter how high wages rise, we have to pay them because of the shortage we are facing," he said.

At least 1 million Myanmar workers live in Thailand, mostly performing labour-intensive jobs. In the food sector, up to 30% of employees are migrant workers from the neighbouring country.

As Myanmar undertakes political and economic reforms, especially after this month's by-election, analysts have begun to point out that positive developments there will tighten the labour market in Thailand over the next few years.

"It is likely that fewer Myanmar labourers will come to work in Thailand because job prospects at home are improving. However it will take a few more years for the trend to become apparent," Mr Visit said.

Thai food manufacturers, meanwhile, have started to consider partially relocating their production to Myanmar to utilise the cheaper labour and fertile natural resources there, he added.

Thiraphong Chansiri, president of Thai Union Frozen Products (TUF), said food manufacturers have turned to automation to cope with higher wages.

"I think it will take a few more years for Myanmar workers to return home to work but Thai manufacturers have to prepare ourselves in advance," he said.

Supachai Sarethsathian, executive vice-president of home appliance-maker Kang Yong Electric Plc, said a labour shortage is the more pressing issue for the electrical industry than the 300-baht daily minimum wage.

"Even with the new minimum wage, we cannot recruit enough people," he said.
One of the factors causing the shortage is a low birth rate of 0.5% in Thailand, said Mr Supachai.

"Crop prices have been increasing and that has encouraged people who used to work in factories to return to their home provinces and farm," he added.

Thais are avoiding jobs that are dangerous, dirty or difficult, meaning sectors such as fisheries and construction have traditionally employed Myanmar labourers, said Mr Supachai.

"Small and medium-sized fisheries might suffer greatly from a shortage in Myanmar labourers," he said.

Piengjai Kaewsuwan, president of the Thai Automotive Industry Association, said a labour shortage has begun for auto parts manufacturers.

"Some second and third-tier parts makers face labour shortages and sometimes it affects their supplies to automakers because they cannot run production according to plans," said Ms Piengjai.

Supachai Manusphaibool, managing director of consultant firm MR & TS Company, said the late entry into the labour market _ aged 35 to 45 _ for some, as well as early retirement for others, has worsened the shortage. The CIA's World Factbook reports Thailand's birth rate is estimated at 12.81 births per 1,000 people this year.

He called on the government to organise more apprentice programmes to discourage unemployed Thais from looking for work overseas. Additionally, incentives should be offered for companies retaining or rehiring middle-aged workers, Mr Supachai added.

http://www.bangkokpost.com/business/economics/288170/labour-shortage-looms