EIC evaluates that the 2020 crisis will have a widespread impact on labor, potentially prompting historic high unemployment levels and exacerbating household vulnerability.

Author: Economic Intelligence Center (EIC)



Thailand is stuck in an unforeseeable economic turmoil provoked by the infectious spread of the COVID-19. The impact has been heavy on nearly all economic sectors with fatal implications on tourism-related sectors. The current situation has put additional pressure on the already-weak labor market. Labor groups with the highest perceived risks due to high sensitivity to economic conditions include part-time workers, freelancers, self-employed, and SME employees, which accounts for 62% of Thailand’s labor force.

EIC estimates the number of unemployed persons will surge to 3-5 million persons, prompting Thailand to witness the highest unemployment figure among all past crises in its history. This is because the impact is more widespread and in tandem with a sudden stop of various economic activities. Meanwhile, the agricultural sector may not be able to absorb unemployment from other troubled sectors as in the past due to the drought problem.

EIC views that although many workers may still be employed, they tend to be handicapped with lower working hours and lower income. Some may even make no income during some periods. As such, the labor market recovery is expected to be slow following a U-shaped recovery of the economy and the impact of COVID-19 that will remain as long as there is no effective medicine and vaccine available. The risks in the labor market could spill over to affect the quality of life of the already-vulnerable household sector. Currently, around 60% of Thai households possess insufficient financial assets to cover for over 3 months of expenses.