PATTAYA, Thailand – The recent decision by the Wage Committee to set the minimum wage at 400 Baht per day for certain provinces, including Pattaya, has raised concerns for local businesses, especially hotels, which are facing higher operating costs. The new wage increase, ranging from 7 to 55 Baht per day, is set to take effect in 2025, with the highest rate in provinces such as Phuket, Chonburi (including Pattaya), Rayong, and Surat Thani.
According to Sinchai Watthanatsatsathorn, Chairman Advisor of the Association of Chonburi Tourism Federation (ACTF) and a representative of Pattaya’s hotel operators, the tourism sector is expected to be significantly impacted. Increased operational costs, particularly wages, are a challenge. Although businesses must comply with the government’s policy, hotel operators, especially in the mid-range and small businesses, may struggle more due to fixed costs like wages, utilities, and ongoing operational expenses.
While five-star and four-star hotels might adapt better to these changes, smaller hotels, especially those in the low-budget and SME sectors, could face severe financial strain. The increase in hotel room supply in Pattaya, combined with only a modest increase in tourism numbers, has led to oversupply in the market. During peak seasons, hotel rooms are fully booked, but in the low season, competition becomes intense, and the burden of rising wages is even more significant.
Sinchai suggested that the government consider including special incentives or seasonal bonuses paid to employees as part of the wage calculation. This could ease the burden on hotel operators, especially in the low season. While Pattaya continues to offer tourism promotions, such as the International Fireworks Festival, hotel operators fear that after major events, the competition will increase, exacerbating the financial pressures already placed on businesses.
As Pattaya heads into the New Year, hotels are fully booked, but the intense competition and increased costs in the off-season are causes for concern, with many operators hoping for government support to navigate these challenges.
