Bangkok – Wages in Asia have outperformed those in most other parts of the world, including the Western economies, according to a new report from the International Labour Organization (ILO). Between 2000 and 2011 wages in Asia almost doubled. Globally real average monthly wages grew by just under a quarter in the same period, while [...]

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Asian wages higher than other regions – ILO says

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Bangkok – Wages in Asia have outperformed those in most other parts of the world, including the Western economies, according to a new report from the International Labour Organization (ILO).

Between 2000 and 2011 wages in Asia almost doubled. Globally real average monthly wages grew by just under a quarter in the same period, while in the developed world the increase was only around 5 per cent over the entire period. The “Global Wage Report 012/13: Wage and equitable growth”, released last week by the ILO deals with work and work-related issues. An ILO statement said Asia’s good performance is mainly due to China, where wages in urban units have grown at an annual rate of 10 per cent or more over the past decade. When China is excluded from the analysis, wages in the rest of Asia have stagnated in recent years and were lower in real terms in 2011 than in 2007, the year before the global economic crisis.

“Given the solid economic performance of many countries in the region, this is a disappointing outcome,” said Yoshiteru Uramoto, ILO Regional Director for Asia and the Pacific. “So it’s not surprising that many workers are unhappy and that we are seeing labour unrest related to wage levels”. Wage levels in developing Asia remain far lower than in Western countries, with average manufacturing wages in India, China and the Philippines well under US$2 per hour, compared to US$12.68 in Singapore and US$18.32 in Japan.

“The emerging economies of Asia have traditionally relied on exports and cheap labour as a source of economic growth,” said Sukti Dasgupta, the ILO’s head of Regional Economic and Social Analysis for Asia according to the ILO statement. “The global economic crisis has shown the limitations of this approach. Giving workers greater purchasing power can help to strengthen domestic consumption as a stable source of demand and reduce the reliance on exports.” The report urged countries to reconnect wages and productivity, and to strengthen wage-setting institutions such as collective bargaining between trade unions and employers and minimum wage legislation.

“Across the Asian region, we see a renewed interest in minimum wages in countries such as Thailand and Malaysia,” said Malte Luebker, ILO’s Senior Regional Wage Specialist. “If properly designed, minimum wages have proved an effective policy tool which can provide a decent wage floor and protect low-paid workers against unduly low wages”.

According to the report, minimum wages should be set by authorities after consultation with trade unions and employers, and they should strike a balance between the needs of workers and their families and economic factors, including levels of productivity.




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