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9 Jul 2021

Thai Economy

Fragile employment has affected the spending behavior of households

  • ​The third wave of COVID-19, which emerged in early April, has yet been brought under control as the number of daily infections remains at an elevated level. The prolonged pandemic caused the KR-ECI to slip to 36.7 in June 2021, from the 37.3 reported for May and 37.2 recorded in January 2021. The 3-month Expected KR-ECI also dropped to 38.9 in June 2021, against the 39.4 recorded in May, suggesting that households were still concerned about the rising cost of living. Additionally, uncertainties surrounding COVID-19 containment measures caused the June KR-ECI components on income and employment to decline from those reported in the preceding month. (The poll was conducted in late June).​
  • Although the survey on employment at various organizations shows that job cuts began to decline in June 2021 as compared to the same period of last year, other factors such as reductions in overtime hours or monthly salaries in lieu of layoffs were more apparent. These are in line with the results of an additional poll conducted by KResearch, which show that most households experienced declining income, which has led them to change their spending behavior.
  • It is expected that the government's relief measures, including the third phase of the co-payment scheme, The More You Spend, the More You Get"" and additional cash handouts to welfare cardholders, will help sustain household spending somewhat. As economic activity has yet to return to normalcy due to the protracted COVID-19 pandemic, the government's economic stimulus measures remain imperative, and they should be implemented concurrently with effective COVID-19 containment measures. Vaccine procurement and distribution must also be carried out in an efficient manner, as well. 

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Thai Economy