Unemployment rate at its highest level

The IMF bailout package, introduced last August, has been blamed for causing mass unemployment in Thailand.

The Kingdom is now experiencing its highest-ever levels of unemployment.

The survey conducted by the National Statistics Office in May revealed that 1.6 million Thais were without jobs, while two million were migrant labourers who flocked to the cities to find work when there was nothing to do on their farms.

The employment rate fell from 91.5 percent to 88.2 percent. In the agricultural sector the number of people employed dropped from 11.6 million to 11.1 million; in industry from 4.9 to 4.8 million; in construction from 2 million to 1.9 million; in transport and communication from 1.1 to 1 million; and in the service sector from 4.7 to 4.6 million. Most unemployed had formerly worked with private companies.

The unemployment rate, meanwhile, rose from 4.6 percent in February to 5 percent in May. A large number of new graduates entered the labour market and many agricultural workers found themselves without work due to the drought.

Lae Dilokvidhyarat, of Chulalongkorn University's Faculty of Economics, said rising unemployment was expected to continue due to financial mismanagement, including the closure of finance institutions, the merging of commercial banks, the privatisation of state enterprises such as Thai Airways, the Electricity Generating Authority of Thailand, the Petroleum Authority of Thailand, and the Telephone Organisation of Thailand.

"About 300,000 workers work in these state enterprises. If these are privatised at least 100,000 will become jobless," said Assoc Prof Lae.

Privatisation would also lead to higher living costs due to rising fees for public service. Bus fares, electricity charges and tap water would all go up.

Mr Lae said the IMF had not paid any attention to the social impact of its policies.

"We don't know if mass unemployment was caused by the IMF, or by the country's economic crisis. But everything has worsened following the implementation of the package," said Mr Lae.

So far 300,000 had been officially dismissed. But Mr Lae believes this to be an underestimate. He thought large numbers would be laid off once foreign companies took over struggling firms.

He added that the Labour Ministry was not effectively helping the unemployed. It had failed to slow down lay-offs or to protect workers' rights and some employers were taking advantage of the situation by cutting redundancy payments.

Mr Lae accused the IMF of focusing too much on financial and business matters and having no answer to tackling unemployment.

"The IMF expects an inflow of foreign investment in the long run, but has not thought how Thais will survive before these investors arrive, especially where there is a lack of social security," he said.

The government expects unemployed workers to return to the agricultural sector, but they don't realise this sector has long been abandoned.

It could only cater to those people who still owned farm land. Many in Bangkok no longer had access to rural communities.

The associate professor said while company shareholders had bank savings, workers had been left with nothing when sacked.

"Our government has been misled into believing the IMF is an angel. They thought the country would be better off if we followed the bailout package," he said.

Bandit Thanachaisethavut, a labour expert with the Arom Pongpa-ngun Foundation, said the package had brought higher unemployment, a drop in salaries and poorer welfare for workers.

In the past seven months, about 6,000 companies had to abandon operations and 300,000 workers had become jobless.

He said the burden of repaying debts had fallen on all Thais. Even the government's National Committee for the Unemployed could do nothing to relieve the problem.

He suggested the government set up an independent body responsible for labour and unemployment problems.