Thailand’s Experiences on Compilation of Compensation to Employee and Workers’ Remittance statistics 12 June 2009 The Bank of Thailand.

Thailand’s Experiences on Compilation of Compensation to Employee and Workers’

Remittance statistics

12 June 2009

The Bank of Thailand

Topics

• Introduction

• Summary on Thai workers abroad

• Summary on Migrant workers in Thailand

• Data Source, compilation, data constraints

• Estimation on compensation of employees and workers’ remittance in Thailand

• Future plans

Introduction• Compensation of employees refers to the income of border, seasonal

and other short-term workers who are employed in an economy where they are not resident and of residents employed by nonresident entities

• Workers remittances are current transfers by migrants who are employed in new economies and considered residents there.

• For many economies, remittances represent a sizeable and stable source of funds that sometimes exceed official aid or financial inflows from foreign direct investment and have the potential to help cushion domestic economy and reduce trade deficits.

• Remittances may have a significant impact on poverty reduction and can finance economic growth in receiving economies.

• The international remittances has increased both in volumes as well as significance upon the recipients’ economies.

Summary on Thai workers abroad

Total number Thai workers abroad by Occupation (Flow)

Occupation 2005 2006 2007 2008

Legislators, Senior Officials And Managers 1,371 1,569 1,919 2,148

Professionals 3,162 3,854 4,146 4,392

Technicians And Associate Professionals 3,136 4,189 5,144 5,932

Clerks 1,119 1,293 1,758 1,541

Service Workers And Shop And Market Sales Workers 12,290 12,956 13,321 13,662

Skilled Agricultural And Fishery Workers 318 514 4,241 5,678

Craft And Related Trades Workers 44,631 54,934 54,923 59,661

Plant And Machine Operators And Assemblers 35,615 38,558 36,627 31,634

Elementary Occupations 38,025 42,979 39,838 37,204

Total139,66

7160,84

6161,91

7161,85

2

Sources : Overseas Employment Administration Office, Department of Employment, Ministry of Labor

Summary on Thai workers aboard

Total number Thai workers abroad by country (Flow)

Country 2005 2006 2007 2008

Taiwan 57,663 62,068 52,193 45,088

Republic of Korea 14,232 16,456 13,287 15,730

Republic of Singapore 11,780 15,115 16,271 14,934

State of Israel 8,746 9,312 10,903 6,200

State of Qatar 3,139 7,516 5,762 10,722

Japan 6,585 7,218 8,002 7,555

Negara Brunei Darussalam 5,216 5,141 4,143 3,349

United Arab Emirates 2,127 3,624 9,850 12,973

Malaysia 4,915 3,418 3,432 3,476

Others 25,264 30,978 38,074 41,825

Total 139,667 160,846 161,917 161,852

Sources : Overseas Employment Administration Office, Department of Employment, Ministry of Labor

Summary on Thai workers aboard

The remaining outstanding of Thai worker abroad is estimated by the Ministry of Labor, using survey from Labor oversea offices (2007), the total stock of Thai workers stood around 450,000 persons

Summary on Migrant Workers in Thailand

Migrant Workers in Thailand• There are 3 major categories of migrant workers in

Thailand

category Data source Outstanding in 2008 (persons)

Aliens who receive legal work permits (both high skills, professional and some labor workers)

Administrative records, the Ministry of Labor (both flows & stock data)

Approx. 200,000

Low skilled migrant workers with ‘illegal entry’ but later on ‘registered’ with the Ministry of Labor

Registration records, the Ministry of Labor (stock)

Approx. 560,000

Low skilled migrant workers with ‘illegal entry’ and no registration

Data not available, some estimates are proxy from many independent studies

Est. 1,200,000

Total estimate: approx. 2,000,000 migrant workers

- 2000 200Number of Aliens Who Received Work Permits During 8 (Outstanding)

Country 2000 2001 2002 2003 2004 2005 2006 2007 2008

Total 76,796 59,978 71,165 86,205 106,988 135,984154,22

0169,72

8201,09

7

Japan 13,355 14,144 13,677 16,738 19,467 21,098 22,976 24,312 28,941

British 5,694 5,166 5,150 6,216 7,392 8,485 9,494 10,150 11,923

American 4,683 4,185 4,099 4,827 5,541 6,429 7,234 7,838 9,505

Chinese 5,890 5,458 4,883 6,008 6,520 9,573 11,268 11,299 13,298

Indian 5,083 5,555 5,144 5,917 6,752 8,263 9,296 9,704 10,727

Filippino 2,725 2,777 2,337 2,819 3,501 4,709 5,916 7,091 8,740

Australian 2,106 1,916 2,090 2,399 2,723 3,125 3,405 3,597 4,230

Myanmar na. na. 4,559 5,247 6,117 7,818 8,664 7,389 8,225

Others 37,260 20,777 29,226 36,034 48,975 66,484 75,967 88,348105,50

8

Sources : Office of Foreign Workers Administration, Department of Employment, Ministry of Labor

Summary on Migrant workers: high skills, professional

Aliens Who Received Work Permits in the Whole Kingdom by Occupation (Outstanding)

Occupation 2002 2003 2004 2005 2006 2007 2008

Legislators, Senior Officials And Managers 33,797 42,438 50,395 59,435 67,993 73,733 85,894

Professionals 11,851 14,221 17,069 20,339 23,809 26,906 32,790

Technicians And Associate Professionals 4,147 5,292 6,645 7,431 8,404 9,226 11,178

Clerks 763 839 1,025 1,149 1,236 1,663 2,121

Service Workers And Shop And Market Sales Workers 2,645 3,403 4,624 5,831 6,249 7,001 8,172

Skilled Agricultural And Fishery Workers 1,339 1,834 2,970 6,493 6,833 6,818 6,816

Craft And Related Trades Workers 2,002 2,160 2,540 3,130 3,685 4,054 4,615

Plant And Machine Operators And Assemblers 710 875 1,105 1,360 1,407 1,569 1,902

Elementary Occupations 7,869 10,032 16,237 26,970 31,183 35,641 44,628

Occupations Unidentifiable 5,914 4,958 4,169 3,631 3,175 2,766 2,550

Training 128 153 209 215 246 351 431

Total 71,165 86,205 106,988 135,984 154,220 169,728 201,097

Sources : Office of Foreign Workers Administration, Department of Employment, Ministry of Labor

Summary on Migrant workers: high skills, professional

Total number of Migrant workers who received work permits (Flow)

  2005 2006 2007 2008

Legislators, Senior Officials and Managers 21,984 22,400 21,841 21,976

Professionals 13,102 14,423 14,814 14,559

Technicians and Associate Professionals 5,813 6,056 7,034 6,638

Clerks 575 505 1,025 1,180

Service Workers and Shop and Market Sales Workers 2,598 2,221 2,484 2,714

Skilled Agricultural and Fishery Workers 4,620 2,745 2,029 1,810

Craft and Related Trades Workers 1,500 2,226 2,304 2,102

Plant and Machine Operators and Assemblers 903 1,032 997 1,108

Elementary Occupations 17,079 16,392 17,703 19,103

Occupations Unidentifiable 348 490 780 601

Training 127 137 43 11

Total 68,649 68,627 71,054 71,802

Sources : Office of Foreign Workers Administration, Department of Employment, Ministry of Labor

Summary on Migrant workers: high skills, professional

Illegal entry, low skilled migrant workers: (both regis. + non regis.)

• Unlike the high skill component, the Low skilled migrant workers in Thailand tend to work in high labor intensive industries such as fishery, agriculture, textile, miner, construction and domestic helpers

• Large concentration in the Bangkok and nearby provincial areas. The North (textile) The South (fishery)

• Can shift from industry to industry depending upon current demands

• Some studies indicate that their earnings are below Thai minimum wage

• Do not rely on bank channel when remitting their incomes back to their families

Methods/channels of remittances chosen bymigrant workers in Thailand (low skilled)

• Through friends/relatives/individual dealers: dealers pick up the money at factory site, with average fee 3-10% of remitted amount or 1.5-3.3 USD per transactions

• Local bank transfer to designated domestic accounts pertaining to friends/relatives/individual dealers and then the dealers deliver the migrants' families fund to the family

• Migrants personally bring the physical cash home upon their return or temporary home visit

Source: The Bank of Thailand Regional Office survey on local establishments (2008)

Current data source, compilation and data constraints

CE and WR compilation

Credit Debit

Compensation of employees

ITRS under ‘Income’ category

some from ITRS, data reported under ‘other services’ category

Workers’ remittances ITRS, reported as part of under ‘compensation of employees’ and ‘other sector transfer/current transfer’

ITRS, can not be distinguished from ‘other services’ and ‘other sector transfer/current transfer’

Concerns & data constraints

• Transactions data from ITRS are recorded on cash basis and netting out rather than on ‘accrued’ and ‘gross’ basis and hence lead to underestimation of gross data.

• Remittance flows data on debit side are included in ‘other services’ category and hence could not explicitly identified due to limitation of the ITRS report forms

• due to limitation on data source and lack of additional data to distinguish between CE and WR on credit side

Compensation of Employees and other private transfers : Thailand 2000 -

2008

0

1000

2000

3000

4000

5000

6000

2000 2001 2002 2003 2004 2005 2006 2007 2008

Compensation of employees receipts Other sector transfer receipts

Other sector transfer payments

Millions of USD

4,899.2

1,898.4

491.8

Concerns & data constraints •ITRS cannot separate short-term and long-term work contract. This hence led to the constraint on the input that we could not explicitly separate ‘workers’ remittance’ from ‘compensation of employee’.•Lack of information on total number of workers and average earnings and wages of workers with ‘illegal entries’

Estimation on compensation of employees and workers’ remittance

in Thailand

Need new method of estimation:

• Data model with supplementary information from other secondary sources

Source Data used

Ministry of Labor (Dept of Oversea employment, Thai labor oversea offices etc.)

Total # of workers (registered) (flow + remaining stocks) including estimates of Thai workers abroad (flow & stock), with work duration (i.e., less than 1 yr, 1-2 yr, 2-3 yr and more than 3 yrs)

Thailand Development Research Institution (TDRI) Thai labor market outlook, independent studies on remittances

National Statistic Office (NSO) Related data on workers, employments by local establishments etc.

International Labor Organization (ILO) Data on low skilled migrant workers, estimates on remittances and in-kind (independent studies in 2008 via surveys and interview migrant HHs along border area)

BOT’s Regional Branch Survey on local establishments (2008)

Ad-hoc exercise, capture data on migrant worker incomes, methods/channels of remittances, sector of employments etc.

‘New estimation’ on compensation of employees

: Thai workers abroad

Number of workers(flow) <1 year and 1 year up

by occupation & country-yearly

Compensation of employees

X

Average earning(GDP per capita or minimum wage by

occupation & country) per year

=Gross

Earnings/Compensation

Estimation on workers’ remittance : Thai workers abroad

Workers’ remittance

Number of Thai workers abroad (stock) by

occupation & country end of year

Number of Thai workers abroad by occupation &

country (flow) 1 year up

X

Average earning (GDP per capita or minimum wage by

occupation & country

-

Expenditure from domestic saving rate by country (ongoing

work)

-

Remittances of residents

In kind 5% of cash remittances

Estimation on compensation of employees : Migrant workers in Thailand

Number of high skill workers (flow) 1 year up

by occupation & country - monthly

Number of high skill workers (stock) < 1 year

by occupation & country - monthly

Compensation of employees

X

Average earning per capita by occupation

per month

+

=Gross Earnings/Compensation

Estimation on workers’ remittance: migrant workers in Thailand

Workers’ remittance : 3 components

Number of high skill workers (stock) 1 year

up-

Number of high skill workers (flow) 1 year up

X

Average earning

Number of illegal workers registered (stock)

Number of illegal workers registered

(flow)1 year up

Average earning

Estimation on number of illegal workers non registered (stock)

Average earning

-

X

X

Estimate expenditure 30% of gross earnings

Expenditure survey from regional office 70% for remittances (in

kind 30%) (ref. ILO & Mahidol U.THA

research)70% for cash

remittances (in kind 30%) (ref. ILO & Mahidol

U. THA research)

70% for remittances

-Expenditure survey from regional office

-

$0

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

1 2 3 4

millio

n USD

Year

Thai workers abroad: CE (new estimate)

Taiwan South Korea Japan Singapore Middle East and Africa Europe, USA, Australia and others

2005 2006 2007 2008

$0.0

$500.0

$1,000.0

$1,500.0

$2,000.0

1 2 3

year

millio

n USD

Migrant workers in Thailand CE: High skill, professional

Japan China UK others

2006 2007 2008

$0.00

$200.00

$400.00

$600.00

$800.00

$1,000.00

$1,200.00

$1,400.00

1 2 3

millio

n USD

year

Migrant workers in Thailand CE: low skilled

Myanmars Laos Cambodia others

2006 2007 2008

$0.00

$200.00

$400.00

$600.00

$800.00

$1,000.00

1 2 3

millio

n USD

year

Migrant Workers in Thailand: WR Total

WR (skilled + professional) WR (low skilled)

2006 2007 2008

Future plans

Future Plans

• Study and use data models to find proxy to calculate remittances: e.g., more

details on …

•Expenditures/savings/remittance pattern of high income Ex-Pat workers

•# of independent family members

•Migrant workers’ expenditures

•Thai workers’ expenditures abroad

• Utilize households survey to capture more parameters involving remittances

(e.g., HH savings, remittances behavior, both cash and in-kinds)

• Other supplemental surveys: labor surveys at airport, foreign labor surveys

(regional)