Thailand's Youth Labour Market Hit Hard by Pandemic Restrictions

Strategic Insights -

The Covid-19 pandemic has caused significant labour market difficulties in Thailand, with a record-high youth unemployment rate seen in the first quarter of 2021. A report by the International Labour Organization (ILO) notes that the restricted environment has particularly affected employment in smaller establishments, with youth employment in these settings falling by 18% for young men and 24% for young women. The report also highlights the crucial role small establishments play in providing employment opportunities for young people.

Key Takeaways:

  • The youth unemployment rate increased by 3 percentage points for both men and women, reaching a high of 6% and 8%, respectively, in the first quarter of 2021.
  • Pandemic-related restrictions particularly affected employment in smaller establishments, with youth employment in these establishments suffering a 18% decline for young men and a 24% decline for young women.
  • Between the fourth quarter of 2019 and the first quarter of 2021, total working hours fell by 7%, or a decline in full-time equivalent employment by 2 million across the whole workforce.
  • A fairly strong recovery in working hours and employment in the last half of 2020 was reversed in the first quarter of 2021 due to the re-emerging waves of the pandemic.
  • Wages increased at the top of the distribution, while the low-pay ratio trended upward on a quarterly basis in 2020, pointing to an increase in wage inequality.
  • The hardest-hit sectors were accommodation and food services (61% of the value added seen in the fourth quarter of 2019), transport and storage (74%), and wholesale and retail trade (95%).
  • The ILO report notes that the socioeconomic crisis may have reversed any recent progress, and there is a concern about the longer-term consequences on the labour market.

Statistics:

  • Youth unemployment rate as of the first quarter of 2021: 6% for young men and 8% for young women.
  • Fall in youth employment in smaller establishments: 18% for young men and 24% for young women.
  • Total working hours decline between the fourth quarter of 2019 and the first quarter of 2021: 7%.
  • Decline in full-time equivalent employment between the fourth quarter of 2019 and the first quarter of 2021: 2 million.
  • Increase in low-pay ratio trended upward on a quarterly basis in 2020: upward.

Sources:

  • International Labour Organization (ILO). Thailand Labour Market Update. (Release date not specified, but cited in 2022)
  • United Nations. International Labour Organization (ILO). Country Office for Thailand, Cambodia and Laos. (Release date not specified, but cited in 2022)