The Impact of Global Crisis on Thais

Abstract

The global crisis reached Thailand around quarter three in 2008. Export sector and tourism industry were immediately hit. The number of unemployed increased from 550 thousand in April 2008 to 820 thousand in April 2009. The unemployment rate among the young worker jumped from 6.3 to 8.1 percent in the same period. This study focuses on the impact of global crisis on different social groups and compares the impact of the current crisis triggered outside and the crisis in 1997 triggered domestically. Female and young workers are vulnerable to lose their jobs in both crises in 1997 and 2008. Workers with the least education who lost their jobs in the formal market move to the informal market with the lag of 3 months to one year. To mitigate the impact of the crisis, the current government introduced a stimulus package using the budget of 2 percent of GDP in 2009 and other policies relating to social insurance. This study shows that the Bht2,000 check in the stimulus package did not increase household consumption. When the coverage of the Social Security Law is low, policy intervention on social security contribution or an extension of the unemployment insurance benefit may work ineffectively.