Thai Industries Face Sudden Labour Crisis Amidst Cambodian Border Tensions
Academics warn of severe disruptions to production and operations as hundreds of thousands of Cambodian workers return home, impacting vital sectors
- Thailand is facing a sudden, severe labour shortage due to a mass exodus of Cambodian migrant workers prompted by ongoing border tensions and rumours of insecurity.
- The crisis was triggered by the rapid departure of approximately 400,000 Cambodian workers over a five-day period, from a total estimated workforce of over 1 million.
- The labour deficit is heavily impacting key sectors like agriculture, construction, and food processing, particularly in border provinces where Cambodian workers constitute 70-80% of the workforce.
- Authorities are considering importing replacement labour from Laos and Myanmar, but this presents logistical challenges in fully substituting the large Cambodian workforce, especially in the agricultural sector.
Thailand is facing the immediate threat of a significant labour shortage, warned a leading economist today, as ongoing issues along the Thai-Cambodian border prompt a mass exodus of Cambodian migrant workers.
The sudden departure of this crucial workforce is set to disrupt production and operations across various Thai industries.
Anusorn Tamajai, Dean of the Faculty of Economics and Director of the Digital Economy, Investment and International Trade Research Centre (DEIIT) at the University of the Thai Chamber of Commerce, has assessed the profound impact of the recent Thai-Cambodian conflict on the labour market.
Cambodian migrant workers constitute a substantial segment of Thailand's foreign workforce, playing vital roles in the agricultural, construction, food processing, and service sectors.
Officially, around 500,000 Cambodian workers are legally employed in Thailand. However, when factoring in undocumented labourers, the total number is estimated to exceed 1 million to 1.2 million individuals.
These workers not only fulfil significant labour demands across numerous Thai businesses but also represent a critical source of income for Cambodia, sending home an estimated 40 billion to 65 billion baht annually, accounting for over 6.5% of Cambodia's Gross Domestic Product (GDP).
The immediate fallout from the border tensions saw a dramatic repatriation of Cambodian workers. During a five-day period of intense conflict in late July 2025, approximately 400,000 Cambodian workers returned to their home country, with a staggering 150,000 departing on the first day alone.
This rapid return was reportedly triggered by widespread rumours of insecurity within Thailand. Anusorn urged authorities to proactively counter such narratives and foster positive relations between Thai communities and Cambodian workers.
This sudden disappearance of hundreds of thousands of workers has led to an acute labour deficit in Thailand, simultaneously burdening the Cambodian economy.
Repatriated workers often face unemployment back home, leading to a loss of income and an immediate decline in vital remittances.
Despite the exodus, a considerable number of Cambodian workers remain in Thailand, particularly in areas further from the border, drawn by higher wages, job security, and the lack of guaranteed employment opportunities back in Cambodia.
The swift reduction in the workforce is already causing immediate labour shortages, hampering production and operations.
This is particularly evident in the agricultural sector, construction, and food processing factories, especially in border provinces like Chanthaburi, Trat, and Surin, where Cambodian workers make up 70-80% of the total workforce.
Many businesses in these regions have been forced to scale back their operations.
Should the conflict persist and exacerbate the labour shortage, authorities may need to consider importing more labour from Laos and Myanmar as an alternative.
However, fully replacing the 1 million to 1.2 million Cambodian workers with those from Laos and Myanmar presents short-term logistical challenges.
Lao workers are limited in number and primarily engaged in the service sector, while Myanmar workers are concentrated in industrial sectors and along the western and northern borders.
This means substituting Cambodian labour, particularly in the eastern agricultural and food processing sectors, could lead to localised and seasonal shortages, especially during harvest periods.
Furthermore, increasing labour quotas, managing immigration procedures, and navigating higher legal costs could impact Thailand's competitiveness in its labour-intensive manufacturing sectors.
In the long term, a structural shift in production away from labour-intensive models towards greater reliance on technology and capital is deemed unavoidable. Planning and investment in technology to reduce dependence on neighbouring country labour must be prioritised well in advance.
