Display mode (Doesn't show in master page preview)

29 Sep 2009


Electronics Industry: Orders Recovering, But Shortage of Workers (Business Brief No.2180)

In the past year, the global crisis has hampered Thailand's industrial sector exports and employment rather seriously, particularly the electronics industry where most plants are sub-contractors producing exports on orders from abroad. The lowest point was seen in January 2009 when exports contracted drastically by (-) 40.4 percent YoY, and production capacity utilization averaged only 41 percent – about half of normal, last year.
This resulted in massive lay-offs, where it is estimated that from 4Q08 to 2Q09, around 30,000-40,000 workers in the electronics industry (8-11 percent of the total 350,000 workers) were made redundant. However, that situation has changed since April because purchase orders from overseas have begun to return, forcing factories to accelerate production and rehire workers. However, it seems not many workers have responded to the recalls, following occupational training provided for the unemployed. Some would prefer self-employed occupations to working in factories, due to the lack of job security as in the past.
Therefore, some business may face line staff shortages in the short run that they may not be able to fully respond to new orders. Overall in 2009, due to the recession, KASIKORN RESEACH CENTER (KResearch) is of the opinion that the average employment in the electronics industry is now about 320,000-326,000 persons, falling around 2-4 percent from the average of 333,000 persons in 2008. Next year, that number is expected to improve after state projects gradually come to completion and the supply of available workers rises, conforming with expected improvements in industry later on. In our estimate, the export value of electronics in 2H09 may have grown 3.2 percent YoY by the year-end, versus the slight contraction of 2.8 percent recently (depending on the global economic recovery), compared to the 26.7 percent contraction in 1H09, before returning to double-digit growth in 2010.

View full article