Thailand to set new daily minimum wage by year-end, excludes previous 400 baht rate.

Thailand is planning to establish a new daily minimum wage by the end of the year, but it will not be the previously suggested rate of 400 baht ($11.19). The initial proposal of a 400-baht daily minimum wage had raised concerns among businesses about increased operating costs and potential impacts on Thailand’s competitiveness for investors.

Labour Minister Pipat Ratchakitprakarn stated that the new wage would still exceed inflation rates. Currently, the average daily minimum wage in Thailand is 337 baht.

While Prime Minister Srettha Thavisin had expressed intentions to raise the daily minimum wage to 400 baht, Pipat clarified that this policy would not apply to the daily minimum wage but rather be implemented as a “pay by skill” system for workers.

Pipat emphasized that significant wage increases exceeding 10% could pose challenges for employers, particularly small and medium-sized enterprises (SMEs). The decision on the new wage rate is expected to be finalized by Thailand’s tripartite wage committee by November and announced as a “New Year’s gift.”

The Federation of Thai Industries (FTI) expressed its readiness to accept the committee’s decision, with FTI chair Kriengkrai Theinnukul suggesting that the wage increase rate should slightly exceed inflation to find a balanced solution.

The new Thai government has introduced a series of populist policies aimed at boosting the economy and reducing living costs, including the distribution of digital wallet-based handouts worth 560 billion baht.