Unemployment expected to hit 2.5%

Unemployment expected to hit 2.5%

EconThai predicts jobless rate for Q2

A desolate ambiance at Siam Square as shops are temporarily closed and traffic is sparse following the prolonged Covid-19 outbreak in the capital. (Photo: Apichart Jinakul)
A desolate ambiance at Siam Square as shops are temporarily closed and traffic is sparse following the prolonged Covid-19 outbreak in the capital. (Photo: Apichart Jinakul)

Thailand's unemployment rate is expected to have risen in the second quarter of this year, as prolonged and severe Covid-19 outbreaks took a heavy toll on Thai companies and entrepreneurs.

Tanit Sorat, vice-chairman of the Employers' Confederation of Thai Trade and Industry (EconThai), predicted that the country's unemployment rate was likely to reach 2.5% in the second quarter, representing about 937,500 unemployed workers, up from 1.96% in the first quarter, representing 758,000 unemployed workers.

The total workforce is estimated at 37.5 million people this year, including 500,000 new graduates who completed their studies in April.

Mr Tanit also expressed concerns about emerging employment trends in the third quarter, due to the government's extension of strict restrictive measures to curb Covid-19 infections until the end of August.

"The government should prepare measures to shore up employment particularly among small and medium-sized enterprises so that the government can immediately implement them once the measures are relaxed," he said.

Mr Tanit proposed the government introduce the co-payment subsidy scheme for six months, whereby the government contributes 7,500 baht per month for entrepreneurs who hire new graduates.

The government may expand the co-payment scheme in provincial areas to hire unemployed workers and new graduates to conduct surveys or work on small development projects such as road construction and water resource development. Such projects can create jobs and support an economic multiplier effect, Mr Tanit said.

He also expressed his disagreement with the government's cash handout measures, saying that such measures only provide a short-term economic boost. A job creation scheme for three or six months would provide better benefits for the economy, he said.

According to Mr Tanit, EconThai's unemployment rate projection differs from that made by state agencies such as the Labour Ministry and the National Economic and Social Development Council (NESDC), based on National Statistical Office statistics and the definition of the International Labour Organization (ILO).

The ILO defines the unemployed as people who are without work or work less than one hour per week.

EconThai defines the unemployed as people who work only 1-19 hours per week, while the employed are those who work at least eight hours per day, or 48 hours per week.

Generally, people who work for one hour per week are labourers in the farm sector, said Jinanggoon Rojananan, deputy secretary-general of the NESDC.

However, the government's planning unit also uses other statistics such as the number of laid-off workers who apply for unemployment benefits from the Social Security Office.

An underemployment rate is also reported. Underemployment refers to workers who work between 0-20 hours. They are not unemployed, according to the Labour Ministry's definition.

NESDC is scheduled to announce social issues, including the employment rate in the second quarter, on Aug 25.

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