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Tariff dispute halts planned wage increase in America

Government commitment to increasing minimum wage to 400 baht encounters obstacle on Tuesday, as the tripartite council postpones determination due to employers' apprehensions about potential economic decline following the recent adjustments in US tariffs.

Tariff dispute halts planned wage increase in America

The minimum wage boost to 400 baht Thai baht hit a snag on Tuesday, as the tripartite board, tasked with making the call, delayed their decision due to employers' fears over potential economic turmoil following the latest US tariff adjustments.

Chaired by the Labor Ministry's permanent secretary, Boonsong Thapchaiyuth, the 15-member board couldn't commit to the wage increase promised by Labor Minister Phiphat Ratchakitprakarn before Labor Day on May 1. Employer representatives at the meeting pointed to insufficient details regarding the wage hike's implementation as the reason for the delay, with the next board meeting scheduled for an unspecified date in May.

On the other side of the table, employee representatives concurred that the current climate wasn't ideal for a wage increase due to the US tariffs. However, Boonsong suggested industries such as tourism and services, which are less affected by US tariffs, may still manage the wage increase.

While the promised wage hike could have an impact on approximately 500,000 small and medium-sized businesses, Boonsong acknowledged the consideration of tourist traffic numbers in the decision. Employers have been vocal about their struggle under the weight of increased costs since the initial wage hike came into effect in January.

Natthakit Khettrakarn, a representative of employers at the meeting, stated that the rising pressure on businesses, particularly small and medium enterprises, has been substantial. He also addressed the 36% US levy on Thai imports and expressed agreement with the delay of the wage increase until a more favorable economic landscape presents itself.

Initially, Phiphat had stated that the details of the wage hike would be ironed out by the April 8 meeting. However, only eight members of the tripartite wage committee attended the meeting, leading to its postponement to April 22. The primary concerns revolve around the potential financial impact on small and medium businesses, as well as essential details about the timing and implementation of the wage increase.

  1. The potential financial impact on small and medium businesses due to the US tariffs was a primary concern for employer representatives, who agreed with the postponement of the wage hike.
  2. Boonsong Thapchaiyuth, the chair of the board, suggested that industries less affected by US tariffs, such as tourism and services, may still manage the wage increase.
  3. Natthakit Khettrakarn, an employer representative, stated that the rising pressure on businesses, particularly small and medium enterprises, has been substantial, echoing the fears expressed by many in the business industry.
  4. The tripartite board, composed of employee, employer, and government representatives, couldn't commit to the wage increase as scheduled, due to insufficient details regarding the wage hike's implementation.
Government's proposed minimum wage hike of 400 baht faces obstruction, as the tripartite committee postpones a decision due to employer worries about potential economic downturn following recent US tariff adjustments.

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