The Federation of Thai Industries (FTI) has suggested the Labour Ministry further help employers and workers by reducing their mandatory contributions to the Social Security Fund to 1% for three months next year in a bid to maintain employment and stimulate spending.
If possible, the new measure should start from Jan 1, Suchart Chantaranakaracha, FTI's vice-chairman for labour affairs, said at a recent talk on the issue with Labour Minister Suchart Chomklin.
The cabinet earlier resolved to have employers and employees make 2% monthly contributions, a drop from the normal 5% rate, from September to November this year to help them cope with the impact of the pandemic.
The reduction meant a payment of 300 baht, compared with maximum contributions of 750 baht.
Former employees who want to keep their social security benefits under the fund were also allowed to pay 96 baht per month, down from 432 baht, for three months.
"The economy is just barely improving and many companies remain weak, so if the government wants to maintain employment, it should consider our proposal," said Mr Suchart.
Up to 790,000 workers in the social security programme have been left unemployed. The number increases to 2.5 million if workers who were furloughed in the wake of the pandemic are included.
To avoid this gloomy prospect, the government needs to implement additional measures to maintain employment, he said.
Earlier the Employers' Confederation of Thai Trade and Industry (EconThai) asked the government to renew the 2% contribution rate for another six months after this relief measure ended in November.
But it would be better if officials consider a further cut, said Tanit Sorat, EconThai's vice-chairman.
"We see reduced contributions as a way to help stimulate the economy and save on employers' expenses," he said.
If the government decides to bring back the 5% rate, businesses, especially small and medium-sized enterprises, will bear the brunt because they have poor liquidity, said Mr Tanit. Some will be unable to continue operations and may lay off workers, he said.
The 2% rate of contributions benefited 11.3 members of the Social Security Fund, said Mr Tanit.
Some employees took home more pay from the lower contribution and spent it buying more goods and services, increasing state revenue from value-added tax collection, according to EconThai.
Officials may be worried reduced contributions will affect Social Security Fund management, but it can raise funds by adding members, said Mr Tanit. Up to 11 million workers, mostly in the industrial sector, have yet to register with the Labour Ministry, he said.