The overall labour situation began to recover from the impact of Covid-19 in the final quarter of 2021, with the unemployment rate dropping to the lowest since the second quarter of 2020, while household debt still increased but at a slower pace.
The government's planning unit, the National Economic and Social Development Council (NESDC), reported yesterday the unemployment rate dropped to 1.64% in the fourth quarter of 2021, representing 632,000 people, from 2.25% or 871,000 people in the previous quarter.
Jinanggoon Rojananan, NESDC deputy secretary-general, attributed the drop mainly to a decrease in the number of unemployed persons who worked before in the labour-intensive manufacturing sector which was particularly hard hit by the Covid-19 outbreaks.
The number of new workers entering the workforce, meanwhile, increased by 4.1% from the fourth quarter of 2020, with new graduates with higher education accounting for 49.3% of all unemployed new graduates.
In the fourth quarter of 2021, the country had a total of 38.63 million workers, down 1.2% from 39.08 million in the same quarter of 2020. Of the total, 37.89 million persons were employed, down 1% from 38.28 million in the same quarter of the previous year.
For the whole year of 2021, the unemployment rate increased to 1.93%, representing 748,000 persons, from 1.69% or 651,000 persons in 2020 as a result of the cumulative effect since the beginning of the year.
However, unemployment in the formal sector continued to fall, as indicated by a decrease in the number of new unemployment benefit claimants.
The total workforce for all of 2021 stood at 38.70 million, up 0.4% from 38.54 million in 2020. Of the total, 37.75 million were employed, up 0.2% from 37.68 million in 2020.
According to Ms Jinanggoon, the employment situation is likely to improve in the first quarter due to the economic recovery.
In a related development, the NESDC reported yesterday overall household debt reached 14.35 trillion baht in the third quarter of 2021, up 4.2% from the same quarter of the previous year, decelerating from a 5.1% increase in the previous quarter, attributable mainly to a slowdown in all loan types.
The ratio of household debt to GDP stood at 89.3%, unchanged from the previous quarter.
Capability to service debt improved slightly, with non-performing loans (NPLs) amounting to 150 billion baht, or 2.89% of total loans, down 2.92% in the previous quarter. This was partly due to the credit quality management of financial institutions.
However, bad debt must be closely monitored because the proportion of personal consumer loans that are overdue by less than three months to total loans is increasing continuously. If there are negative factors affecting household income, bad debt may increase, warned the NESDC.
"Household debt tends to rise in the following period. This is because high-income households or those who have not been affected by the crisis are more likely to incur debt, particularly in auto loans," said Ms Jinanggoon.
"Pre-orders for motorcycles and cars at the Motor Expo 2021 in December exceeded the target of 30,000 units, and housing loans increased as a result of financial institutions easing mortgage regulatory measures. The groups impacted by Covid-19 also are likely to need personal consumer loans to compensate for liquidity lost due to loss of income," she said.
