Japanese firms operating in Thailand plan bigger wage increases

Nna/kyodo

More Japanese companies in Thailand are implementing increased relative wage hikes this year on the back of an improving economic outlook in the Southeast Asian country.

A new survey by the Japanese Chamber of Commerce, Bangkok, shows that 26.7 percent of manufacturers are offering larger wage increases this year, up 8.4 percentage points from the previous year, while 25 percent of nonmanufacturers and representative offices are doing the same, up 5.6 points.

But overall wage increases among Japanese subsidiaries and other members of the local Japanese chamber remain unchanged at 4 to 5 percent, in line with rates over the last five years.

Around 60 percent of surveyed firms in both manufacturing and nonmanufacturing sectors say they are maintaining wage hike rates, compared with those set a year before. The percentage of firms implementing smaller pay hikes this year comes to about 15 percent, down from around 30 percent last year.

The survey is based on data collected from 565 companies in the Japanese chamber. Over 1,700 member firms employ nearly 1 million of Thailand’s approximately 40 million working population.

Kazuma Takago, first secretary at the Japanese Embassy in Bangkok, told NNA that wage hike rates offered by Japanese companies are higher and more stable than those handed out by local firms.

According to the Japanese chamber, annual growth rates of the nation’s average wages have been volatile, registering 10.2 percent in 2014 but settling for 1.8 percent in 2015.