Cambodian Workers Fear Factory Closures Over Wage Hike Demands

Cambodian factory workers are expressing concern that some unions' demands for a $250 wage increase in negotiations for 2027 could lead to factory closures. Ms. Thun Sreypov, a worker at Precision Footwear (Cambodia) Co., Ltd., supports the demand for a wage increase for 2027 but requests an increment that is acceptable to both workers and factories, allowing them to move forward together. "When we demand wages that are beyond the company's capacity, and the factory cannot operate, if the factory closes, we will all lose our jobs and our livelihoods," she stated. "I request that wages be increased reasonably, and that we continue to have jobs in Cambodia. If wages are raised but there are no jobs in Cambodia, we cannot accept that," she added. Ms. Mao Sina, a fellow factory worker, also worries that excessive wage demands could harm the collective interests of workers. She suggests that instead of high wage increases that become a heavy burden on companies, the Ministry should monitor other business owners, such as landlords and vendors, whose prices for rent and goods are continuously increasing. "If the government raises wages slightly, but some landlords, like the one where I live, increase rent by $5 a month, then if the increase is too steep, I won't have the capacity to pay the rent. Therefore, I ask the relevant ministries and authorities to inspect rental prices as well," she clarified. Regarding the wage negotiations for 2027, economic expert Dr. Hong Vannak pointed out that the emergence of war in the Middle East, particularly between the United States, Israel, and Iran, or its spread around the region, has a dual impact, especially on oil and gas prices and disruptions to supply chains. "Considering all these situations, we must think about a price that can be accepted by everyone. Especially those making decisions should use the base foreign wage as an indicator to show the workers and employees. And include inflation and other prices as a basis," he stated. It should be noted that wage negotiations are conducted through a tripartite mechanism, with the participation of worker and employer representatives, under the coordination of the government, and based on evidence, economic conditions, and the labor market. For 2027, some unions are demanding a base wage of $250, and tripartite negotiations have already been held five times. Source: Kampuchea Thmey Local