By 2100, Thailand’s population will have dropped by over 32% to 46 million with an increasingly aged society. In the short term, there are also signs that the current reduced level of economic growth brought about in some respects by demographic changes, is beginning to feed into a rise in inequality or a reversal of the progress seen over the last five decades. The World Bank, in a recent report, confirmed that between 2015 and 2017 inequality in Thailand rose despite economic growth during that period.
While Thailand’s economic planners talk of economic reform and taming the strong baht, figures published this week by the National Economic and Social Development Board point to a massive transformation in terms of demographics that will take place in Thailand in the next twenty years. This change, combined with World Bank data suggesting that inequality has been rising since 2015, shows that the effects of Thailand’s declining birth rate and a range of other issues will present the country with a steep economic and social challenge in the coming years.
Figures published this week show that Thailand is on the verge of becoming an aged society which will occur in 2021 when the kingdom will begin its descent into becoming a super-aged society by 2050.
The figures from the National Economic and Social Development Board have deep implications for Thailand’s society, economy, politics and for each person in the country on a personal basis.
This also includes foreigners who have long used Thailand as a retirement paradise both for its weather, low cost of living and cheaper labour costs.
Figures and projections are startling
The figures for 2020 and projections for 2040 are startling. They show that the country’s population of young people will be reduced by 34% while the proportion of older or senior people will grow by 70%.
Currently, there are 11.2 million Thais under 15. This will drop to 8.2 million by 2040 which will see the percentage of the population under 15 drop from 16.9% to 12.8%.
Senior population set to explode
On the other side of the spectrum, the number of seniors will explode from 12 million people now to 20.42 million by 2040 when they will then represent 31.28% or nearly a third of the population.
Population begins to contract from 2028
It should be noted that this is a 20-year timeframe which is less than a generation. The impact of this transformation will begin to be felt more keenly even from 2028 when the Thai population will also begin to contract by 0.2% per annum.
Under current projections, Thailand is expected to lose 32.5% of its population by the end of the century, bringing the population to just over 46 million.
However, while this might sound alarming, it should be compared to Thailand’s population of 27.4 million in 1960
The problem, of course, is that this will be an increasingly aged society in a post-industrial economic environment.
The overall reduction in population and its aged profile will also mean lower consumer expenditure per se unless there is some dramatic rising in income per capita. The figures raise profound questions.
Working-age population already in retreat
The movement in the next 20 years will see Thailand’s working adult population decrease from 43.26 million to 36.5 million by 2040. That will see it reduced from 65% of the population to just over 56% in that period.
This will see the number of working adults to seniors reduced in half from 3.6 today to 1.8 in twenty years.
Current figures showing employment levels in Thailand already confirm that the numbers have begun to decline even as employers and the government seek to entice older workers to work on after retirement.
New living patterns making the problem even more chronic and difficult to tackle for policy makers
Thailand’s government and health service have begun looking at the challenge facing society as the problem is also being exacerbated by more modern living patterns where more people in Thailand are living apart than before.
As society changes, this will also make the demographics problem more difficult to handle.
The number of seniors living alone has more than doubled from 1994 to 2014 rising to 8.7% while 18.3% of Thai families in 2015 had only one child and 19% of households contained spouses living together without any offspring.
Less developed welfare system and higher incidences of acute health conditions in Thailand
The huge aged population in a society that has not yet had a fully developed social welfare and comprehensive free healthcare system presents a tremendous future challenge to Thai planners.
Another particular factor endemic to Thailand is a greater likelihood of senior Thais developing health problems relating to diabetes and hypertension compared to other countries.
Declining birth rate – now down by over 75%
The demographic challenge as with other countries has been brought about by the decline in the birth rate from 6 (per woman capable of conceiving) in 1960 to 1.46 in 2016.
The Thai government has been adopting policies like those in France and Hangry to encourage women in Thailand to have more children but it will take some time for these policies to have effects if any.
The policy is also opposed by many left-leaning observers and social commentators, particularly in academia.
Thailand’s economic progress since 1960 was a success story but that era is now over
Thailand has long been praised by global institutions in spite of the country’s record of political instability for achieving impressive economic growth and social development since 1960.
In that year, the Thai population stood at just over 27 million. From then until 1997, the country with its growing population together the implementation of industrialisation programmes and an expansion of the economy from an agricultural base achieved a growth rate of 7.5% per annum. Thereafter, from 1997 to 2005, it achieved a growth rate of 5%.
An oft-quoted but still impressive statistic shows that from 1986 to 2017, the poverty rate in Thailand decreased from a massive 67% in 1986 to 7.8% in 2017. The poverty rate is defined as access to ฿165 per day to live.
Aged population will hurt the north of Thailand more and the hardship will hit women the most
However, new problems and what might be a new trend are emerging.
Currently, based on the projected demographic patterns, it is being predicted that the largest effects will be on the north of Thailand which is also the country’s poorest region. The population in this region will age more quickly and become more dependent.
NGOs and world bodies have also predicted that the hardship brought on by an ageing society will fall disproportionately on women in particular older women and there will be a lot more of them as, with extended life spans, women will still significantly outlive men. This new society will see unheard of numbers of very old women.
In contrast, more working Thais will be converging closer to Bangkok while the country’s eastern region will attract more population and the south has a relatively better birth rate.
World Bank data may suggest a link between stodgy economic growth and increased inequality
However, as the effects of the demographic change have already begun, there are also signs that inequality in Thailand has begun to rise since 2015.
Despite it being a key government priority to tackle the issue, World Bank figures for that period are showing that household consumption for the poorest 40% in Thailand from 2015 to 2017 decreased compared to an overall rise in the economy. This is, of course, even before the recent downturn beginning at the start of 2019.
This would raise concerns that the future for Thailand’s less educated and less well off may be a bleaker one despite the kingdom emerging as a higher income country after decades of economic development.
The World Bank has also confirmed that inequality in Thailand as measured by the Gini coefficient has grown during that period.
Problem with Thailand’s education system
Aside from the acute demographic challenge and on top of the short term slow down of the Thai economy seen in 2019, there are several other issues which may also require the government’s attention.
One is the inefficiency of the Thai education system which feeds into the country’s ability to attract higher paid jobs. In a recent report, the World Bank illustrated the point.
For a Thai child or student with nearly 12.5 years of Mediacom up to Mathayom 6 (secondary school), it is the equivalent of a similar child receiving 8.6 years of education in other, more developed world countries where reliable outcome data is available.
The problem is simply explained. The quality of education for the average Thai student is lacking.
Thailand – a problem of life and death
The other issue for Thailand is one literally of life and death.
The rate of adult survival in Thailand is significantly below the average for responding countries in the world. This applies to potentially work adults from 15 years old to 60.
The reasons behind it are that many Thais appear to succumb to diabetes and acute hypertension disorders or conditions.
The other highly significant factor is Thailand’s chronic problem with road safety and the number of accidents resulting in death and serious injury stealing way the kingdom’s economic potential.
Decisive action and critical thinking required
Radical and effective new measures and policies are needed in Thailand to maintain and push forward a country which is so unique and which still draws so many foreigners to it despite all its problems.
To keep the Thai smile smiling in the future will take more than just a good heart and talk but decisive leadership and clinical thinking. In the end of the day, the point is quite simple, it’s all about people.