When it comes to demographics, it is no secret that Thailand is quite an anomaly.
With a median age of about 41 years old, Thailand is among the oldest countries in Southeast Asia -- second only to Singapore, which has a median age of 42 years old and about 1.5 times the Asean average of 28.9 years. But whereas most countries with a comparable median age are categorised as developed economies, Thailand stands out for being one of the few still-developing economies whose population has already started ageing.
As a comparison, the median population age in Hong Kong, Japan, Singapore and South Korea only started to increase when their gross domestic product per capita breached the US$41,000-mark (about 1.3 million baht) -- over twice the level of the kingdom's current GDP per capita.
And unlike the citizens of developing nations in the region, Thais are choosing not to have as many children, with just 10.1 births for every 1,000 citizens in 2021 -- a decline of almost 4% from the previous year. Myanmar, meanwhile, has a birth rate of about 17 for every 1,000 citizens, Vietnam has about 15, while Laos' birth rate is over double Thailand's, with 22.
These figures mean there will be fewer and fewer people available to meet the domestic demand for labour. With a median age of almost 41, the average Thai worker is basically a middle-aged individual, and the population isn't getting any younger. Considering that over 33% of Thailand's workforce is employed in the agricultural sector -- with physical demands more suited for younger individuals -- it is no surprise that farms across the nation have had to source workers from Cambodia, Laos and Myanmar, where the median age of workers are much lower.
Further, this mismatch extends beyond the agricultural sector. The government has been pushing for the swift digitisation of the economy to increase efficiency, but the push to move everything online is threatening to leave huge chunks of the society behind.
Why? Most jobs which are available to older applicants tend to require little to no specialised skills, and for many elderly workers, these jobs -- which include bus conductors and caretakers among others -- are the only source of income they have, in the absence of sufficient support from the government (in the form of pensions and senior allowances) and/or family members.
For the government's digitisation drive to succeed, a degree of flexibility and technology literacy is needed, and the best way to prepare society is by investing in the comprehensive upskilling of the workforce.
However, according to a 2019 research by Thammasat University, only 1% of Thais have the skills required to survive in a modern, ICT-oriented workplace. This means significant investment needs to be made to ensure that Thais can compete, not just in the growing pool of global talent, but also among themselves.
The Prayut administration seems to have identified what needs to be done, rolling out roughly 3.5 billion baht in June to equip fresh graduates and recently laid-off workers with the skills to secure employment.
The training, however, is limited to "hairdressing, packaging design, auto repair, air conditioner repair, sewing and making household tools" and only ran for three months. The package was quickly followed by another 3.5-billion-baht pledge to "upskill and reskill" about 160,000 workers about a month later, which government spokesman Anucha Burapachaisri said would help 310,000 workers maintain their jobs.
Aware of the dangers posed by a rapidly ageing society, many governments around the world have also started to pour money into upskilling schemes. Singapore, for instance, pledged 2.5 billion baht last year to help companies implement training and transformation programmes for their employees. Under their scheme, companies would receive grants if they can identify skill gaps and plan for reskilling and career progression for employees.
Singapore's Deputy Prime Minister and Finance Minister Lawrence Wong said the move was necessary "to ensure a good match between the skills demanded by industry and those offered by the workforce".
Thailand would be better served by such a scheme, as there is a huge mismatch between supply and demand in the labour market. By allowing companies to organically work out the kind of skills that they would like their employees to have, the government could come up with better policies and effectively direct its investments, as opposed to pouring billions of baht into equipping workers with obsolete skills which do not provide them with either good pay or job security.
In short, Thailand will have to ramp up its efforts to upskill its labour force to ensure more working-age citizens are able to contribute to the economy. Failing to do so will only increase the burden on the welfare system, which is already stretched thin as it is.