Job crisis ‘to worsen till third quarter, linger on for 2 years’

IN a worrying projection issued on International Labour Day well-known Thai economist Anusorn Tamajai warned that the job cut and unemployment crisis will worsen in this the second quarter of the year and  continue in the third quarter both in Thailand and across the world.

The analysis issued Mr Anusorn in his capacity as president of the Pridi Banomyong Institute says this crisis will linger on for not less than two years with some jobs and occupations slowly disappearing from the system and while new ones will arise, these will be less than the total job cuts as a result of shrinking economic and social activities.

Humans must adapt or they will be replaced by robots and artificial intelligence at an accelerated speed with this leading to unemployment. The government would have to set the strategy for their adjustment with this being in the form of financial support and encouraging the whole society to change through education, training and practical projects.

These projects would have to be large scale and the government could either itself implement them or encourage the private sector and industries to do so.

Mr Anusorn expects there to be not less 7 million people unemployed as a result of the economic crisis. Moreover there will be a lot of people doing lower-level work and the unemployment status of others disguised.

In the worst case scenario, unemployment may soar to 28% of 38.41 million workers which would mean 11 million people nationwide being unemployed. Around 30 to 60% of the 18.08 million people working in the service or trade sectors could be jobless for two years from this year onward.

This group of workers would have to acquire new skills to pursue other careers.

Improvement of safety and work standards of certain professions which Thai workers shun, and for this reason foreign workers are hired in their stead, should be made so that locals take them up. This would also be a way to prevent the spread of coronavirus infection.

Mr Anusorn, a former director of the National Research Council of Thailand, Economics Research Committee (Office of Prime Minister), suggested that the following policies and measures be implemented:

  1. The Labour Protection Act be amended to increase the layoff compensation for every duration of employment by an additional two to six months (increasing the highest compensation from 12 to 14 to 18 months) as this increased cost would deter employers from opting for job cuts.
  2. The government pay the employer’s share of the social security contribution for one year if a company hires more workers even though it is suffering a loss.
  3. Thailand should to ratify  International Labor Organization conventions number 87 and 98 to increase the bargaining power of employees and make labour relations fairer at workplace.
  4. Thailand should change the definition of “unemployment” and “employment” so that the true jobless rate is discovered because right now there are a lot of people who work only a few hours a month and do not earn enough to live on.
  5. The minimum wage should be changed to hourly basis so that both employers and employees have more flexibility all round amidst the economic crisis.
  6. Increase the Labour Ministry’s budget to use in helping workers in various industries develop new skills so that they are more productive in the New Normal economy.

Mr Anusorn also suggested that the government both increase the Labour Ministry’s budget by 50 to 100 billion baht and clear unpaid state contribution to the Social Security Fund as even though this government has fully paid up, some previous governments had not done so. If all is paid up then the fund would be in a stronger position to help people.


Top: Workers constantly carving at a jade factory except when tour groups come through. Photo: Jeremiah Roth (CC BY-SA 2.0)

Insert: Anusorn Tamajai says the job market outlook is bleak.


TNR staff
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