Thai footwear industry faces labour shortage

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BANGKOK, March 5 – Thailand’s footwear industry is facing a labour shortage as many workers have returned to work in their hometowns following the nationwide minimum wage rise.

Kanchit Chanthanapornchai, chairman of the Association of Thai Footwear Industrial Promotion said that Thai footwear industry’s production dropped to 13.7 million pairs last year from its normal annual level of 19 million pairs.

Thailand lost market share to Vietnam, whose production capacity and export value tripled, but Thai entrepreneurs are not discouraged.

Mr Kanchit said that Thailand has good potential for higher production capacity and new innovation and Thai footwear industry is adjusting itself.

He said he believed Thailand has an opportunity to penetrate markets in the US, Europe and ASEAN countries with a target growth of five per cent or about US$1.8 billion or about 54 billion baht in value.

Besides the 300 baht minimum wage rise, what is worrying now is labour shortage of more than 10,000 persons as workers move to work at their hometown, the chairman said.

Entrepreneurs asked the government for assistance in coping with the labour shortage and that foreign labour is an option.

Singapore and Malaysia are Thailand’s rivals in terms of price competition, while Vietnam and Indonesia are competitors in production.

However, he believed that Thai footwear industry can compete with other countries if it improves quality and creates its own brands.

It will be able to penetrate markets in ASEAN countries when the bloc forms the ASEAN Economic community (AEC) in the next two years.