Jobs the key to recovery
published : 1 Jun 2020 at 04:30
newspaper section: News
It is a great boon for people and the economy that, effective today, more businesses and activities are allowed to reopen under the government's third stage of lockdown easing, despite the fact the draconian emergency decree will extend for another month.
The impact of the nationwide lockdown for more than two months has been massive. So far, about seven million people are reported to have lost their jobs from the sudden stop of businesses and activities.
The reopening of business activities will help a large number of unemployed workers return to their jobs.
The National Security Council which handles the lockdown measures aims to reopen all businesses and activities, including inbound travel, by July 1. If that happens, more jobs can be created and recreated.
Still, the government is obliged to work hard at preventing new coronavirus infections while it tackles the unemployment crisis. This is because unemployment rates will remain high even after the lockdown is completely lifted.
It is certain the employment situation will not return to the way it was before the Covid-19 outbreak. Due to social distancing guidelines, aimed at preventing a second wave of outbreak, many businesses cannot run their operations at full capacity.
For example, provincial bus operators can provide service at only 50% of capacity to ensure physical distancing.
Restaurants will have to rearrange their seating as well. A restaurant that can accommodate 50 customers is required to use only half of its capacity. Several other businesses will have to adjust their operations.
In addition, the suspension of global logistics and travel due to the pandemic is expected to be prolonged. Tourism will take time to recover.
The business sector will continue to be cautious in spending and in making employment decisions as long as there is no effective medicine and vaccine available.
As a result, business operators are not expected to reinstate all staff. Not all temporarily unemployed labourers will return to their jobs after the lockdown ends.
It is estimated that as many as 20% to 30% of workers who lost their jobs during the lockdown may be unable to return to their former workplaces.
In addition, about 520,000 new graduates are expected to enter the labour market from May to July. They will have a hard time finding jobs.
Meanwhile, the farm sector which usually plays a key role in absorbing the unemployed has limited capacity this year due to the impact from severe drought.
According to the National Economic and Social Development Council, unemployment could surge to 8.4 million workers in the third quarter.
This estimated unemployment figure accounts for about 22% of the total workforce of 38.2 million people.
It is the highest rate since the country began to collect unemployment statistics in 1985, beating the highest record of 5.9% unemployment in 1987 and 3.4% during the Tom Yum Kung crisis in 1998.
With this unemployment rate, bad debts will increase. And state relief packages -- such as the 5,000 baht cash handout for three months -- is not enough.
Instead, the government should pay serious attention to mass job creation, resuscitating the farm sector, and rolling out financial measures which will enable business operators to keep their manpower.
Handling unemployment should be a priority of the government's 1.9-trillion-baht relief package, of which one trillion baht comes from borrowing.