Pattaya Daily News

18 February 2013 :: 11:02:19 am 71630

It Pays To Be A Government Worker In Thailand

A government worker in Thailand may get a lower monthly salary than a private sector worker, but because of greater job stability, the government worker will end up accumulating more lifetime income, according to a special report by the Thailand Development Research Institute (TDRI).
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The study was conducted to analyze the potential impact of raising the salaries of government office workers with bachelor’s degrees to 15,000 baht per month. But the report concluded that the impact will be mostly negative.

The higher pay for government workers will affect the equilibrium in the labor market and create a financial burden on the state budget, while also affecting the frequency and buying power of consumers, the report stated. Recent government changes in salary include the new minimum wage per day of 300 baht.

The TDRI study was funded with a budget grant from the National Research Council of Thailand. The study’s lead researchers were Dr. Worawan Charnduaywit, welfare economics expert; and Mr. Chayadol Lomthong, a researcher atTDRI.

They studied the possible effects of a government policy that upped the salary to 15,000 baht per month for workers with bachelor’s degrees. Among the factors considered by the researchers were the long-term nature of government jobs, which can be regarded as basically lifetime employment. This results in more accumulated income, compared to private employees whose jobs tend to be not as stable.

The study also analyzed the impact of the 15,000 bath monthly salary in terms of being a possible burden of the future budget of the government, which would affect the financial stability of the government in the long-term.

The data for the comparative salary study was obtained from periodic surveys of the government and private industry workers covering a 30-year time span, from 1980 to 2010. The annual surveys were conducted in the third working quarter of each year.

The surveys tracked the income of the selected working population from ages 25 to 34 years old. Included in the calculations of income for the group were supplemental fringe benefits paid such as bonuses, overtime pay, allowances for food, clothes and so on.

The subjects studied were divided into 3 education levels: less than a bachelor’s degree, a bachelor’s degree, and university graduate degrees. The subjects were also divided by where they lived, whether inside or outside of Bangkok.

Researchers then tracked these employees and civil servants every year for 30 years. They calculated the average annual income each year until the year 2010, when the participants had reached the ages of 55 to 64 years old.

The results showed that over their lifetimes, the civil servants inside and outside Bangkok received more accumulated income than the private employees, especially the civil servants with bachelor’s degrees, or less education than a bachelor’s degree. The government workers’ greater overall income is due to the stability of government employment compared to private industry employment, with fluctuates according to the economy.

The workers with advanced graduate degrees generally had high incomes during some periods, but during bad economic periods, their incomes would drop greatly. Unlike the private sector, however, government revenues are not as subject to fluctuations in the economy.

Within Bangkok, the private industry employees have higher incomes than civil servants, especially for those who have bachelor’s or graduate degrees, although again, the volatility of the income of the civil servants is lower, and thus more stable in the long term.

The civil servants do not always have lower monthly incomes than the private employees. There is a relatively small number of civil servants with higher education degrees who could be paid more if they were working in the private sectors.

However, the study did not include information about the supplemental pay given to government workers for additional duties, like attending mandatory meetings, additional income from teaching or researching, or receiving other premiums given to government workers, which can be sizeable amounts.

In addition, the value of the welfare that the civil servant receives was at about half of their lifetime revenue. By contrast, the welfare given to private sector employees was not much, when compared to the ratio of revenues made in private industry to the welfare budget for workers according to the present-day value of welfare.

The study found that the lifetime revenue of civil servants was higher than private sector employees in every educational level, both inside and outside Bangkok. When comparing the value of costs in 2007, the civil servants with less than bachelor degrees usually got higher lifetime incomes than the private sector employees.

The study also pointed out that working in Bangkok will result in a higher lifetime income compared to the other provinces in every level of education. However, those with education below a bachelor’s degree who work for the government would still have more lifetime incomes than in the private sector.

The welfare amount is much more for the government workers including those who with a higher education degree, compared to working in a private company that would have the initial advantage of higher pay at the beginning of working life compared to the public sector.

In addition, a comparison using econometric models assumed that civil servants’ revenue is less than the private sector employees for only some types of careers, who are mostly the executives or civil servants working in Bangkok, which is a minority of the total workforce across the country.

Other professional groups and civil servants earn more than private sector employees, with the difference being obvious in the case of civil servants working in the region. So, the salary increase for civil servants with a bachelor’s degree and below will create a greater difference between the higher income of civil servants compared to the private employees in every region.

But the burden of government funding for the new civil servants is less than the budget burden from the adjustment of the salary base for the old civil servants, because they would have to be compensated by amounts not less than salaries paid to the new workers. There would also be fewer new workers to have to pay compensation according to the new salary policies of the government.

This study suggests that the base salaries for civil servants with less than a bachelor’s degree will result in a gap between the lifetime income of civil servants and the income of private employees, with the incomes greater for government workers

This is accomplished more by the length of employment, rather than differences in salaries. So while the monthly pay of government workers with graduate degrees may lower than their peers working in private industries, it could be said the problem of the inequity pay scale has been solved, but at the wrong point.

In the future, the number of the civil servants should be based on hiring skilled and competent workers, so the higher base salaries should focus on jobs with high responsibility. At the same time the number of low-skill jobs performed by civil servants should be reduced. Some of these types of low-skilled government jobs should be given to the private sector instead.

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