Unemployment: A Looming Danger
This is the third of three articles about "Women and Work" in Thailand written for the Kitakyushu Forum on Asian Women's foreign correspondent programme for 1995-6.
Unemployment has been arguably the greatest social evil afflicting the Western world
over the past 15 to 20 years. Slowly and painfully developed societies have come to realize
unemployment rates of up to 10% or more are not some anomaly. Instead they are
recognized as the inevitable result of major structural changes in national and international
economies as well as significant attitudinal changes among employers and managers.
You might ask what does this have to do with Thailand, a nation with a booming
economy and an annual growth rate of over 8%? And how can it be a problem specifically
for women?
Although the Thai minimum wage of about US$5 per day is low, and many workers do
not in fact even receive that, the wage rates in the economies which have attracted recent
investor interest (particularly Vietnam, China and Myanmer) are even lower. Already
labor-intensive industries are moving away from Thailand into those countries where they
are also likely to find an even more submissive work force. The five leading export
industries in Thailand - electronics, textiles and clothing, processed food, precious stones
and footwear - are all based on this cheap labor of which 70% of the workers are women.
This figure is 90% in the food industries. However, agriculture, the major employer in
Thailand is in decline, while in the fishing industry many of the low-paid unskilled jobs
remain hard to fill. To compete with the lower-wage countries, these industries in
Thailand will have to introduce higher levels of technology, which means greater use of
capital and less of labor. Thus, fewer jobs, which demand a higher level of technical skills
and knowledge, will go to young men with at least a secondary education.
The major export industries, which have all developed up in the last 15-20 years, have
traditionally employed women who have only basic primary education, if that. These
women have generally remained in the basic level positions they entered almost two
decades before. Now with only basic literacy and often poor health after decades of hard
work in substandard conditions, they are in a very poor position to be retrained. In spite
of many years of labor at low wages, they are being undercut by women in surrounding
countries working at even lower rates. These Thai women are further impeded by the lack
of a strong financial base.
I wrote in the last dispatch about the structural changes which have already begun to
impact on Thai middle-aged women working in labor-intensive industries; such as, textiles
and food processing. Despite continuing low wages they are being priced out of work by
women in neighboring countries who can be employed for even less.
Such changes have greatly affected both men and women in western nations who have
traditionally been employed in similar jobs - the new migrants, the poorly educated and
the otherwise disadvantage. But the other factor which has led to further unemployment
pain in the West is a change in business philosophy and shifts in the relationship between
employer and employee.
This can be illustrated by my shock when I first came to Thailand and found that in my
local supermarket it was almost impossible to push a trolley around the aisles - not
because of overflowing stock, but overflowing staff. The aisles were blocked by staff
chatting, doing their hair, having a quiet nap - employees who were not so much slacking
off but who were severely underemployed. The medium-size supermarket seemed at any
one time to have several dozen staff on hand, and there was no way they could have
usefully spent their time working. There were three or four cashiers and an equal number
of packers, and the remainder of the staff simply came to work and went home, having
done almost nothing in between. A similar staffing level is the norm in every organization
with which I have had contact in Thailand.
In Australia, however, a medium-sized supermarket like this would have at most a half
a dozen staff on duty at one time - perhaps four cashiers, a manager and a trolley-
collector/storeperson, with a few part-timers stacking the shelves in the evenings.
Yet 20 or 30 year ago the ratio of goods sold per staff employed would not have been
much different in Australia to that of present day Thailand. The dramatic change has
come not only in part from a focus by consumers on price, but also from a basic change
in business philosophy. Instead of focusing on increasing sales or expanding the business
into new areas, business theory has stressed reducing costs to increase profits. Many
business costs; such as, rent, electricity and goods for sale are basically fixed, but the great
variable is staff. For a small businesses, reducing staff numbers by one has been seen as
having a very big positive impact on "the bottom line", and accountants in larger com-
panies have often seen the possibilities for staff cuts by the hundred and savings by the
millions.
Combined with this, indeed essential to it, was a change in the understanding of the basic
relationship between employer and employee. In the West, the sometimes paternalistic,
sometimes simply supportive work environment was until the last decade the norm. A
business might face a down turn, but it would have to be in a dire position before it would
even think about sacking permanent staff. My understanding is that this is the relationship-
which commonly exists today in Thailand, but for how long ?
Business rationalization has been the buzz-word in the West for a long time, and as
wages rise in Thailand it can only be a matter of time before the concept catches on here.
And the sad thing about rationalization is that once one major company in a field chooses
this route, its competitors are forced to follow, in order to compete with the lower prices
offered. So a downward spiral begins.
It is often the "service" jobs which are easiest to cut - those jobs in which the output
is hard to measure and whose results are not seen in the production of some concrete item.
Sales staff, support staff (from secretaries to tea-ladies to cleaners) and lower to middle
managers are most at risk, and many of these are women. In Japan, presently many female
graduates are finding it impossible to get good jobs which will offer them a future because
they would have occupied these sales and support jobs which have been the first to
disappear under economic pressure. In Thailand, it is not hard to imagine in a few years
the graduates of commercial colleges and high schools may find themselves trained for
sales and support jobs which do not exist.
Personally, I must admit to some equivocal feelings about this. From my Western view
of work, I find it hard to imagine that any great favors are being done to a person paid to
stand around, do nothing and be bored all day, which is what many, many workers in
Thailand now appear to do. But unemployment can hardly be a better fate.
It has taken Western nations 15 or more years to acknowledge the seriousness of the unemployment problem, and there has not been any serious efforts to tackle the problem.
The fact that the far more developed West has still not found the will or the way to
seriously tackle the problem does not bode well for the coming crisis in the Thailand, and
other Asian countries. It is likely that women, both the poor, middle-aged unskilled
workers and their better educated daughters, who will still lack the skills needed for future
jobs, are going to be among the worst hit.
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