BANGKOK — Up to 6 million people are expected to lose their jobs in the tourism sector as a result of the coronavirus pandemic, a report said.
Reports from the UN’s International Labour Organization (ILO), as well as the University of the Thai Chamber of Commerce, said that unemployment will affect millions of people in Thailand’s tourism sector, a critical industry that accounted for 21 percent of the country’s GDP.
“Thailand’s tourism sector has overcome many past shocks, including natural disasters and political instability,” the UN report said. “However, there may be new emerging sources of risks that may need to be considered.”
It added, “The magnitude of the current socio-economic shocks that come from the health and economic effects tied to the current COVID-19 pandemic are, however, unprecedented in recent history.”
The briefing cited information provided by Thailand’s National Statistics Office. The data used was collected from January to March, before a raft of restrictive measures were imposed, including a 10pm to 4am curfew and ban on inbound commercial flights.
The report also did not account for Thailand’s informal workers, whose jobs have been put at risk by the pandemic.
Teflon Thailand No Longer?
The industry’s woes were rooted in the total collapse of inbound tourism. International tourist arrivals in January and February dropped to 5.9 million, compared with 7.3 million in the same months last year.
According to the Ministry of Tourism and Sport, income in this time dropped from 381 million baht to 293 million baht, or a decrease of more than 23 percent.
From January to March alone, 139,000 people in the tourism sector already lost their jobs, mostly those working in accommodation.
The University of the Thai Chamber of Commerce estimated that up to 6 million people in the sector would end up unemployed, if Thailand lost about 30 million tourists; its forecast said Thailand may only see 8.5 million tourists this year.
The number of unemployed people could even rise to 10 million if the pandemic does not subside by the end of June, the report by Thai University of Commerce warned.
Since hotels have been banned from operating, some have switched to offering medical service instead – 130 hotels have volunteered to serve as quarantine facilities and provide accommodation for medical workers.
Thailand relied more on tourism than some of its neighbors. Tourism makes up 21.6 of Thailand’s GDP, compared to Cambodia’s 6.7 percent and Vietnam’s 6.9, according to the ILO.
“The situation in Thailand provides relevant insights for tourism in the region, as it has a relatively high share of employment and GDP in tourism,” the ILO report said.
It also warned that the tourism sector would not survive the pandemic’s repercussions without assistance from the government.
“The millions of workers that earn their livelihoods from the sector will not be able to support themselves and their families for long through wage cuts, or worse, job losses, without government assistance,” the report said.
The government is already offering up to 100 billion baht in soft loans for tourism operators, who can also request for debt suspensions and interest rate reductions.
The state will also return 1.4 billion in deposits to tour companies registered with the Tourism Department. Under the laws, tour companies must post a security deposit of 50,000 to 200,000 baht when applying for licenses.
Each company can get 50 percent to 70 percent of the deposit back, according to the new policy.