Residents Experience Hardships Amidst Thailand's Financial struggles
In the heart of Thailand, the economic landscape of 2025 presents a challenging picture for low-income workers and small business owners. The country's projected growth of around 1.8% is marked by significant uncertainties, particularly due to global trade tensions, most notably U.S. import tariffs.
This fragile economic environment has taken a toll on informal sector workers and microenterprises, such as motorcycle taxi drivers, street food vendors, clothing vendors, and electronics repair shop owners. The dampening of business and consumer confidence has led to lower private consumption and investment, which in turn reduces disposable income for low-income workers and spending by customers of small vendors and service providers.
For instance, Mr A, a 38-year-old clothes vendor, is grappling with decreased sales due to reduced local consumer spending and competition from online stores. Similarly, Somsak Benjawan, a 48-year-old motorcycle taxi driver, has seen his earnings plummet, with current daily earnings of only a few hundred baht on a good day—a stark contrast to the pre-pandemic days when he could make over 500 baht, and even up to 1000 on a good day.
The challenges faced by these groups extend beyond reduced demand. Income growth for informal sector workers tends to lag inflation, effectively reducing real earnings. Many such workers lack formal wage protections, leaving them vulnerable to economic shocks and rising costs without adequate support.
Sector-specific pressures also loom large. Motorcycle taxi drivers like Somsak are likely to experience reduced ridership and fare incomes due to lower overall consumption and cautious spending. Street food and clothing vendors face challenges from reduced foot traffic and consumer spending, especially if tourism and exports slow, limiting demand. Electronics repair shops may see decreased demand as consumers delay non-essential repairs and purchases amidst economic uncertainty.
However, there are opportunities for improvement. The World Bank highlights that digital technologies could help boost productivity and create jobs, potentially benefiting micro and small enterprises by improving market access and service efficiency. Public sector investment is expected to be a primary growth driver and could provide indirect support by improving infrastructure and stimulating economic activity.
Chatchai Boonrawd, an entrepreneur with dreams of launching an online store, has faced barriers due to high shipping fees and steep digital platform cuts. Despite these challenges, he shares concerns about the economic struggles faced by ordinary Thais due to various factors such as increased costs of living, reduced consumer spending, and competition from online stores.
In light of these challenges, Thida Suwannasri, an office worker, is worried about her ability to pay next month's rent due to stagnant salary increases and rising costs of living. Suwanna Mekprasert, a street food vendor, is struggling due to high pork prices, while sales in Chatchai Boonrawd's electronics repair shop are slow.
Moreover, external factors such as political instability and border conflicts can further exacerbate the economic situation. A recent report by the Thai Bankers Association, the Federation of Thai Industries, and the Thai Chamber of Commerce predicts that Thailand's economy will grow by less than 2% this year due to U.S. tariffs.
In summary, Thailand’s modest economic growth and trade uncertainties have strained low-income workers and small business owners in informal sectors. These groups face income pressure and reduced demand, though digital advancement and public investments offer some prospects for improvement. It is a time of struggle, but also a call to action—for businesses, policymakers, and society at large—to find ways to support and empower those most affected by these economic challenges.
- Despite the challenging economic landscape, Mr A, a clothes vendor, and Somsak Benjawan, a motorcycle taxi driver, are among the low-income workers who have seen a significant decrease in their earnings due to reduced consumer spending, competition from online stores, and sector-specific pressures.
- In spite of the tough economic circumstances, digital technologies are highlighted as a potential solution to boost the productivity and job creation for micro and small enterprises, offering improved market access and service efficiency, which could alleviate the struggles faced by vendors and service providers like Mr A and Somsak.
