Workers mark Labor Day with grumbles over prices

Friday, 11 May 2012 From Issue Vol. XX No. 19 By  Warunya Thongrod & Manoon Makpol

Labor Day brought more grumbles than smiles from Pattaya-area workers who say rising food and energy prices are negating the benefit of an increased minimum wage.

A May Day poll released by Suan Dusit University found that more than 40 percent of the 1,440 workers polls April 25-30 felt they were facing greater hardship than a year ago, due to lingering effects of the country’s devastating flooding and higher consumer prices.

Beaches weren’t as full as normal on Labor Day this year, as people are being a lot more careful with their money.Beaches weren’t as full as normal on Labor Day this year, as people are being a lot more careful with their money.

Nearly 61 percent said they were most concerned about higher prices of goods, water and electricity. Another 29.7% said they were most worried about having inadequate income.

Mesa Khontham, an employee at Pattaya’s Dusit Thani Hotel, said she was pleased to see her daily wage rise to 273 baht on April 1, but feels that the 39 baht increase “seems pointless” in the face of higher prices.

“Electric bills, grocery bills, utilities bills, traveling costs … I have tried to spend as little as possible, but I think the government needs to help control price increases,” she said. “If it goes higher than this, workers will not be able to handle their expenses.”

April prices of food and beverages jumped 4.5 percent, processed food by 6.7 percent and ready-to-eat meals 8 percent. Raw food, however, jumped only 2.7 percent.

Overall energy prices rose 4.4 percent annually in April, down 4 percent from March. Electricity rates, however, jumped 12 percent on higher demand.

Combined with higher minimum wages, energy price increases actually are affecting businesses more than consumers.

“The increase in minimum wages since April 1 has affected the business sector considerably,” said Mrs. Bundarik Kusolwit, president of the Thai Hotel Association Eastern Chapter. “Every hotel in Pattaya is affected, but currently cannot recoup the costs as they have signed contracts for rates.”

The Suan Dusit poll found the public overwhelmingly wants the government to impose market-distorting price controls, more budget-busting social-welfare benefits and even higher minimum wages.

Economic analysts, however, say workers don’t understand that the wage hike put in place last month takes time to ripple through the economy. Businesses will slowly raise prices over the next half-year to recover the expense of the higher minimum wage, leading to more inflation and higher prices down the line.

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