Thailand’s job market faces growing challenges, with indications of a shrinking workforce and rising business closures, according to the Federation of Thai SMEs. Data from the Social Security system shows a decline in insured workers under Section 33 of the Social Security Act, which covers over 10 million employees, reflecting broader economic struggles.
Financial reports from fiscal year 2024 highlight distress among businesses, with many reporting losses or filing inactive financial statements with the Revenue Department. Rising production costs continue to pressure small and medium-sized enterprises (SMEs), which have faced difficulties for years, even before the pandemic. The economic downturn, combined with global disruptions such as the Russia-Ukraine war and shifting investment patterns, has further constrained job creation.
Sangchai Theerakulvanich, president of the Federation of Thai SMEs, emphasized the need for workforce development to align with evolving industries. He urged education reforms to equip workers with skills in artificial intelligence, digital technology, and foreign languages, particularly beyond English. Comparisons with regional economies, such as China and Indonesia, suggest Thailand is falling behind in upskilling and reskilling efforts.
A report from the National Economic and Social Development Council (NESDC) highlighted that foreign direct investment is increasingly concentrated in high-tech industries, including semiconductor manufacturing, data centers, and smart electronics. While these sectors are expected to generate around 170,000 jobs, concerns remain over Thailand’s dependence on foreign skilled labor. The IMD Digital Competitiveness Ranking for 2023 underscored skill shortages in science, technology, engineering, and mathematics.
Another challenge is the potential impact of U.S. trade policies. The NESDC warned that protectionist measures by the U.S. government, including tariffs and regulatory changes, could affect Thai exports and employment. Additionally, Thailand remains at Tier 2 in the U.S. Trafficking in Persons Report, raising concerns about potential future trade restrictions.
Official figures indicate a slight increase in unemployment in 2024, rising to 1% of the workforce, or approximately 402,200 individuals, up from 0.98% in 2023. The total workforce also declined by 0.2%, reflecting broader economic pressures. While employment in agriculture continued to shrink, the hotel, restaurant, transport, and warehouse sectors showed signs of recovery, benefiting from improved exports.
Government officials, industry leaders, and economic analysts attended recent discussions on employment challenges and potential solutions, underscoring the urgency of labor market reforms.
