Federation of Thai Industries says unemployment could hit 8m

The prolonged Covid-19 pandemic will likely leave up to 8 million people unemployed by the end of this year, says the Federation of Thai Industries.

The economy in the second half of 2020 will not fully recover because the stimulus packages will take time to boost the economy, the FTI said on Thursday.

FTI chairman Supant Mongkolsuthree said the situation will cause companies to reduce operating costs, cut salaries and even lay off staff.

“The FTI wants the government to come up with new measures to help these workers,” he said.

Suchart Chantaranakaracha, the FTI’s vice-chairman for labour affairs, said the total workforce in Thailand numbers 37.3 million, including those who work in services (47%), agriculture (30%) and factories (23%).

“Unemployment currently stands at 3.3 million as a result of the sluggish economy and Covid-19 outbreak,” he said.

The FTI said the Thailand Industrial Sentiment Index (TISI) in June rose to 80 from 78.4 points in May, due to positive factors like the government easing lockdown measures.

“These factors help business return to normal,” Mr Supant said. “The low infection rates we hear about every day also boost business confidence.”

The TISI is based on a survey of 1,205 enterprises in 45 industry sectors.

Half the respondents expressed high concern over the current political situation, while 46.7%, notably exporters, were still worried about foreign exchange fluctuations.

Mr Supant said businesses, especially small and medium-sized enterprises (SMEs), are fretting about liquidity and access to finance. They also fear higher operating costs resulting from increased prices for fuel, raw materials and logistics.

The FTI wants the government to help entrepreneurs by using products and services made locally in its development projects.

The federation also asked the Thai Credit Guarantee Corporation to issue credit guarantees for SMEs so that they can better access the Bank of Thailand’s 500 billion baht in soft loans.