By Outhoumphone Sanesathid,
Coffee and rubber productions are vital to local Lao communities, particularly in the southern part of Laos. Coffee is a well known cash crop produced by both smallholder farmers and big companies in Paksong district. Rubber production is also one of the largest Lao agriculture exported commodity, it has been planted in every part of Laos. Rubber is the main cash crop operated by smallholder farmers and companies in Bachiengchalurnsouk district.
Lak 12 village, Paksong district
Local people have a lot of land to operate their own coffee farms. Most livelihoods are based on coffee plantation. Coffee farmers can generate their main income just once a year during the harvest season. Red cherries cannot be kept for many days, thus many farmers immediately sell them to middlemen in the evening after they have finished picking them. However, some of them attempt to sell green coffee beans for a better price. Green beans need processing and thus time and investment. Therefore, this might be a reason why a majority of farmers prefer to sell red cherries instead. The earning of coffee farmers depends on the land size for coffee plantation. It is approximately 9-12 million kips (approximately 1,035-1,379 USD) per hectare/year.
The harvest season is a peak time for farmers as well as for wage laborers and migrant laborers. Both wage and migrant laborers can work in both household’s farms and coffee companies’ farms. They are paid per kilo of cherries harvested. The harder they work on picking the more money they earn. The average income is about 290 USD/month. However, particularly migrant laborers prefer to work as monthly contractors with local coffee farmers, the income is approximately 105-140 USD/month. In addition, laborers receive some basic welfare such as stay in the coffee farmers’ house, as well as 3 meals per day, and transportation. Migrant laborers, who work in coffee companies’ farms, are usually paid per kilo of coffee beans. The companies arrange the place to stay and provide some basic living needs such as water, toilets and some medicine for first aid.
Local farmers are well organized during the year; they plant two types of coffee: Robusta and Arabica coffee, these two types of coffee have different harvesting seasons. This gives constant work to farmers. While Arabica coffee is harvested from September to December, the latest is in January, Robusta coffee is harvested from January to March the latest is in April. When the harvest season ends, many coffee farmers plant vegetables such as cabbage, ginger, cassava, chilly and other fruits for additional income. Many coffee farmers prefer to work by themselves for weeding, fertilizing and pruning the coffee trees. But in the harvest season, farmers have to hire laborers to pick coffee beans. During the low season coffee farmers make less money, and the situation is even worse for wage laborers and migrant laborers.
Wage laborers are concerned with living conditions since less work for income is generated. One of my interviewee, a wage laborer, started to shift from rice farming to working in coffee plantations about 30 year ago after he got married. He told me that each year he can earn a lot of money during the coffee harvest season. However, he will have nothing to eat when harvest season ends. Unluckily this year his health is going down, thus he cannot work as hard as he used to be:
“I could not work hard as I used to be, but I have to responsible for my children and wife, I become indebted because I have not saved any money I just spent my money I earned without any planning”.
Migrant laborers have better conditions than wage laborers. Because most migrant laborers are rice farmers, they can go back to work in their rice farm when coffee’s harvest season ends and they will come back again in next coffee’s harvest season.
Coffee farmers will spend half of total amount they earn to hire labor, while they will use the rest of money for their children’s education, daily food expenses, recreation expenses such as expensive motorbikes, smart phone, television and to buy some assets: gold, land and to build a new house. Wage laborers and migrant laborers are poor people, they are able to spend for their children’s education, and daily food expenses, but unable to buy basic assets like land. Interestingly, farmers, wage laborers and migrant laborers often put big amount of money on socialization. I’d like to distinguish two types of socialization. First, official socializations are socialization with formal invitations. Lao people have the tradition that if someone invites one for parties or events such as wedding, new house cerebration, festivals etc., the guests must put money into the invitation card to maintain good relationships and to congratulate the host. Secondly, there is general socialization, which refers to any parties without any invitation, people gather with friends or any people they know and drink together when they have free time, which is usually in the evening after a hard working day.
Markngeo village, Bachiengchalernsouk District
In this village there is a big rubber company operated as a land concession investment. The company has given priorities to local villagers for employment opportunity, and then for migrant laborers. Most laborers are under wage employment contract. For the last two years the rubber’s price has constantly increased, providing good earning for rubber laborers. Harvesting rubber’s latex is technical, the instructions  are taught to all laborers before harvesting by company’ technical experts. Laborers can earn money per kilo of latex harvested. The price per kilogram is according to the grad of latex: grad A is an excellent latex yield for which laborers have followed technical instructions correctly. Grad A latex is 1,100 Kip/Kg, while grad B is 900 Kip/Kg and 800 Kip/Kg for grad C. The lowest income is approximately 290 USD/month/person and the highest is about 523 USD/month/person. For those who are migrant laborers, company will offer accommodation, and some basic needs such as water, toilet, medicines. For local wage laborers, the company can provide medicines when an employee get sick. The company also give some extra money as well as a certificate at the end of the year if employees show good working performance, skills in harvesting, and don’t refuse working.
Laborers in rubber production can earn more money than coffee laborers in terms of income per month and also in terms of working duration. Rubber can be harvested for 10 months a year from March to December, January and February is the off-season. However, working in a rubber company is harder than working in a coffee company. In order to get great latex yield, laborers have to start their work at 9 PM until 3 or 4 AM, (they will work without any holiday allowed). In daytime, some local people who are wage laborers will also work for their own business such as working in rice farm, cassava farm, feeding the animals and so on. Throughout my observations, the working time from 9 PM till 4 AM is very tiring. Many people sleep at noon and wake up at 4 PM to work on their own farm. This may the reason why some local villagers use drug to increase their work ability in the daytime and that leads to drug addiction issues later on.
This is a example of a family working in a rubber plantation. They operate as family business and make contracts with their relatives who would like to work voluntary. The contract indicates that laborers must work from the first stages of the plantation : seeding, planning, watering and weeding till the harvest work starts. They have to work for free for about 5 years. Rubber trees can be harvested after 5 years. There are 50/50 for income dividend for the first ten years, and other ten years will be 30/70; 30 percent for laborers and 70 percent for land owner. During the time of my interview, one family has started harvesting for about 7 months. Each month the family can earn about 5,800 USD from their 8 hectares of land with about 23,255 USD of initial investment excluded land value).
The way laborers and migrant laborers spend their earnings is not conventional. One farmer want to save money for their children’s education and buy new land to extend their business, on the other hand wage, and migrant laborers prefer to put their money for food, and recreation things such as expensive motorbike, expensive car and expensive smartphone. Here, also, people spend a lot of much money on socialization; they often drink beer, alcohol, play card and smoke. In average, they mention less that they will spend their earning on children’s education.
This family with 3 members earn about 500 USD/person/month. After working for 6-7 months they decided to buy an expensive pick up car (its cost is approximately 35,000 USD). Unfortunately, their driving skills were not good enough. After a week, the car hit a concrete barrier causing serious damages, the cost of repairing was too high and the car has been parked for almost 4 months (at the time of my visit), because the car owner has no money to repair. This is an evidence that there is no plan on money expenditure, especially long run financial planning.
The cases I mentioned show the current situation on how household earn and spend money in that area. I would conclude that laborers in coffee and rubber production don’t have low income in comparison to other occupations. According to my calculation, coffee laborers can earn about 186 USD/month while rubber laborers can earn about 232 USD/month for the whole year (12 months) which greater than 1,100,000 Kip or 128 USD/month the minimum salary as indicated in Lao’s labor law. However, social welfare for laborers still needs to be improved such as health insurance and yearly health check-up while giving long run financial planning skills must also be considered. Local livelihoods right now follows the Lao’s common phases “Ha Yark Jaiy Ngai” (hard earning but easy on paying) which leads to bad behavior, since laborers work hard on earning income, but many of them spend the money for useless commodity. Indeed, this situation may not happen only in villages where I took the survey, but it happens in many places in Laos. Thus, educating people on money savings would be fruitful to change people’s behavior on expenditure, I would suggest that related organizations especially the Ministry of Labor must put more effort and work hard on retiring insurance issue, since laborers are at risk when they get old or become unable to work due to injuries. Labor financial stability, as well as concerns on drug addiction prevention is also needed for improving Lao laborers’ condition in the future. Last but not least, children’s education must be put at the centre of the concertation by District and Province Education Office, educational institute needs to work hard particularly in Makngeo village on educational promotion for pushing parents to spend more money and make future plan for their children’s education.
 Wage laborers usually referred to local families who have small land and event do not have land they will going to work in other coffee farm. They will earn money without any social welfare treatment
 Migrant or mobility labor refers to laborers who from outside the village come to work in household farm or coffee companies.
 Meals for laborers are usually very simple, they usually find vegetables surround the coffee farm or vegetable that farmers planted for eating.