Thailand’s industrial sector hit by mass layoffs amid economic woes

Mass layoffs have swept through Thailand’s industrial sector, with approximately 2,600 factory workers losing their jobs over the past two days. Financial difficulties have compelled employers to downsize their operations, leading to significant disruptions in the workforce.

An electric vehicle manufacturer in Chachoengsao announced that 600 workers will be laid off, effective December 1. This decision, communicated in a letter dated October 25 and shared by the Facebook page Noom-sao Rongngan (Young Factory Workers), attributes the layoffs to a decrease in orders coupled with escalating expenses.

The company assured that affected employees would receive compensation in accordance with legal requirements. In their announcement, the company highlighted the financial strain influencing their operations.

“The decision has been challenging, but necessary due to the current economic conditions.”

In a separate development, a prominent jewellery factory located in Samut Prakan has also declared significant job cuts. According to a post on the Bang Pu Industrial Estate’s Facebook page, 2,000 workers will be laid off, with the changes taking effect on January 1. This move signifies the broader challenges faced by the manufacturing sector amid a sluggish economic climate.

Data from JobsDB by Seek, an online job search platform, revealed an increase in the number of managers and executives seeking new opportunities during the first half of the year. This trend underscores the slow pace of Thailand’s economic recovery and the tepid industrial demand that has marked the initial months of 2024. As the nation grapples with these economic hurdles, the possibility of further layoffs and factory closures looms large.

A worrying trend

The Federation of Thai Industries (FTI) reported a worrying trend, with over 360 factories shutting down in the first half of the year alone. These closures represent a combined investment value of at least 9.4 billion baht and have displaced more than 10,000 workers, surpassing the average figures from the preceding two years.

Bangkok Post reported that this wave of shutdowns and layoffs highlights the precarious state of Thailand’s industrial sector as it navigates a challenging economic landscape. A spokesperson from the FTI has highlighted the gravity of the situation which continues to unfold.

“The industrial sector is facing unprecedented challenges, and the impact on employment is significant.”

The recent wave of layoffs and factory closures paints a stark picture of the current economic conditions in Thailand, with workers bearing the brunt of the downturn. As the country strives to rebound from these challenges, the focus remains on stabilising the economy and mitigating the impact on its workforce.