Beyond Living

For manufacturers in every category of retail, labor is a major expense. As a result, one of the primary methods for keeping retail prices down is to minimize the cost of labor required to produce goods. This is the reason why so much manufacturing has relocated to Asian countries, especially China, in recent decades. But cheap labor often means bad labor practices, with workers exploited by companies that force them to work long hours for little pay and no benefits in sweatshop conditions.

On a recent visit to the Bangkok International Gift Fair (October 16–19), many Thai vendors told me that they can't compete with Chinese-made products based on price. The cost of labor in Thailand is too high. Why, I asked, isn't cheap labor available in Thailand?

For one thing, the government has set certain labor standards, and created a social safety net that covers most workers. Healthcare is almost universal in Thailand. By paying 30 Thai baht (about U.S. $1) anyone can see a doctor or enter a hospital and be cared for. There is also a Social Security program that withholds seven percent of a worker's wages (matched by the government) for retirement. The Thai government also sets basic wages and working hours. All employees sign one- or two-year employment contracts, giving them protection from arbitrary or sudden firings. (Companies also are protected from employees walking off the job, but employees I spoke with said that employers never pursue workers who quit before their contract expires.)

My hosts, the Thai government's Department of Export Promotion, arranged a tour of two local factories, where I could get a glimpse of working conditions in the country. The first visit was to Yothaka International Co. Ltd., a furniture factory located about an hour from Bangkok. Surrounded by rice fields, the two-story concrete building has large open windows on all four sides, catching the breezes that drift in across the rice paddies.

About 200 employees, men and women in their 20s to 40s, work in the factory creating casual chairs, sofas, tables and other furnishings made from cane, water hyacinth and recycled plastic. Dressed in blue trousers and light blue, short-sleeved shirts, each worker sees to his or her individual task — weaving, stapling, cutting — while sitting on the floor or straddling the furniture piece he or she is completing. Some were barefoot, others wore flip-flops.

The Yothaka furniture line is a sophisticated, beautifully designed product sold mainly in Europe and Japan. One of the company's 12 designers, Suwan Kongkhunthian, explained that water hyacinth is an invasive reed that is choking the waterways of southern Thailand. Some 20 years ago, Thais figured a way to use the reed in a weaving process that led to furniture making. Now villagers are paid to clear the waterways of a nuisance that has also become a cash crop. Yet while the water hyacinth furniture is still popular, especially in northern Europe, it is being surpassed by a demand for outdoor furniture, which Yothaka manufactures using imported, non-toxic, recycled, polyethylene plastic. The building process for both lines of furniture is similar.

This is a very low-tech operation, Kongkhunthian noted with a laugh. Apart from automatic staple guns and drills, the only visible electronic equipment was the overhead fluorescent lighting. The products are 95 percent handmade by local workers and others who were brought from northeast Thailand — an area especially noted for skill in handicrafts. All employees are trained at the factory; and while the majority are women, Kongkhunthian believes that the men are somewhat better at the job. “They are better with the details,” he said.

Employees work from 9 a.m. to 5 p.m., six days a week, with Sundays off.

Another low-tech operation, Beyond Living, is a textile producer located in an upscale residential neighborhood of Bangkok. The factory is actually a house, rented from the uncle of company co-founder and designer Ploenchan Mook Vinyaratn, and comes with a (not-used) swimming pool in the back yard. Vinyaratn, an attractive, energetic young woman who was educated in England, founded her company in 2003, with five employees. Today, Beyond Living employs 65 — all but five are women. “The men are needed to do some of the heavy work,” noted Vinyaratn.

Beyond Living produces a high end line of woven textiles used for placemats, coasters, table runners, cushions, and area rugs. It mostly serves a niche market of exclusive hotels, such as the Four Seasons, in Southeast Asian resort areas. Vinyaratn also works as a stylist for hotels.

When Vinyaratn began her hiring process, she placed notices in the community looking for women who were unemployed and who had no previous experience in the textile business. She wanted to train her employees from the start, removing the need to undo bad habits learned elsewhere. As her staff grew, Vinyaratn added many women referred by current employees. She boasts that not one of her employees has resigned since the company was started.

The working parts of the factory — some 30 looms and other hand-operated devices — occupy the ground floor of the house, which is open on all four sides. The second floor is used for administrative purposes. Working conditions are crowded, but not suffocating; most of the women sit at looms, while others spin yarn or squat on the floor finishing and checking completed products. All are dressed in similar trousers and short-sleeve shirts. They also work 9 a.m to 5 p.m., six days a week. Most of the workers are located in this factory, but business has been so good that Beyond Living recently launched a satellite operation in a village just outside of Bangkok.

Workers at both Yothaka and Beyond Living appeared very industrious and hard-working; there was very little talking, and certainly no signs of “goofing off.” And they didn't seem to be putting on a show for visitors. Indeed, they paid us very little attention.

Without these jobs, these Thai citizens would probably not be working at all or, at best, performing some menial task. Instead, they've been trained for jobs that require a skill; they are making living wages, and they have benefits that many in other parts of the world can only envy. And considering the quality and beauty of the products they're making, it's understandable that the merchandise costs more. Many American and European wholesalers and retailers are taking that into consideration when sourcing in Thailand.