Author Topic: Poll: Debts among workers at 10-year high  (Read 1384 times)

Offline thaiga

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Poll: Debts among workers at 10-year high
« on: April 27, 2018, 12:37:13 PM »
Poll: Debts among workers at 10-year high

Household debts among workers have risen 4.9% year-on-year to 137,000 baht per household on average this year, the highest in a decade, according to a survey.

The poll was conducted on 1,194 workers earning less than 15,000 baht a month by the University of the Thai Chamber of Commerce (UTCC) ahead of the Labour Day on Tuesday.

Of the debts, 65.4% were formal loans with an average 10.6% interest rate a year. The rest, or 34.6%, were informal loans with interest of around 20.1% a month, said Thanawat Ponvichai, UTCC vice-president for research.

An overwhelming majority, 96%, said they were indebted, the highest proportion in 10 years. The major purpose of the borrowing chosen by 36.1% of the respondents was to cover general expenses, followed by asset purchases such as cars or motorcycles, investments, home-buying, medical treatments and debt repayments.

The average monthly debt repayment of the respondents was 5,326 baht.

Most of the debtors, 85.4%, missed repayments over the past year because of lower incomes and higher expenses, rising goods prices, as well as higher debt burdens and loan interest rates.

Asked whether the current debt burden affected their spending, 45.7% said while their spending remained the same now, they would tighten belts over the next three months.

They planned to spend 3.7% more than they did last year during the Labour Day, or around 2.2 billion baht, the highest in a decade, mainly due to a higher cost of living. The popular activities were travelling, socialising, dining-out, movies and shopping.

Most think the minimum wage hike effective on April  1 was moderately appropriate -- they want a wage hike every year in keeping with the higher cost of living. They also would like the government to tackle unemployment, control goods prices, solve migrant-worker problems, improve social security reduce lending interest rates and control loan sharks.

The survey results indicate their purchasing power has recovered, albeit very delicately, said Mr Thanawat.

“When combined with farmers, whose incomes dwindle in line with farm prices, they make up 60% of the population and the grassroots economy.

“The groups still lack confidence in spending so the recent expansion of the economy came only from tourism and exports,” he added.

Mr Thanawat suggested ways to solve the problems.

“The government must speed up injecting funds into provincial economies to stimulate employment. It must also monitor farm prices and speed up public investment.

“The funds are slow to reach provincial economies and contractors who have won projects are large ones. The government must make sure the money goes to small contractors to push the economy to grow in a range between 4.2 and 4.4% in the second quarter,” he said.

The UTCC maintained its economic growth forecast this year at 4.2% to 4.6%.
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