Dining on a Deficit: Thai Restaurants Slash Headcount as Economic Growth Falters
As same-store sales plummet by 18 per cent, restaurateurs abandon permanent hiring in favour of part-time student labour to survive a low-growth 2026
- Thai restaurants are reducing their workforce due to a severe 18% drop in same-store sales, a direct result of Thailand's faltering economic growth.
- To cut fixed costs, operators are replacing permanent staff with part-time student workers, a strategy that also helps them avoid rising Social Security contributions.
- The financial strain has led to minimal salary increases and the near-elimination of bonuses, especially for employees at small and medium-sized establishments.
As same-store sales plummet by 18 per cent, restaurateurs abandon permanent hiring in favour of part-time student labour to survive a low-growth 2026.
Thailand’s restaurant sector is entering a period of forced austerity, with operators "shedding weight" to survive a fragile economic recovery.
Confronted by rising labour costs and evaporating consumer spending, businesses are increasingly ditching permanent staff in favour of part-time workers to curb mounting fixed overheads.
In an interview with Thansettakij, Sorathep Rojpotjanaruch, chairman of the Restaurant Operators Club and Honorary Advisor to the Thai Hostel Association, revealed that the industry’s approach to pay and benefits has been fundamentally fractured by the current climate.
Salary adjustments for 2026 are expected to average a meagre 3–4 per cent, with increments reserved almost exclusively for essential middle management.
The Bonus Drought
The disparity between large chains and independent outlets has reached a breaking point.
While "Size L" enterprises—those with annual revenues approaching 1 billion baht—may still offer bonuses of up to four months, such rewards have become "almost impossible" for small and medium-sized (SME) establishments.
The primary culprit is a dramatic collapse in Same-Store Sales Growth (SSSG). Industry data shows a staggering 18 per cent decline in sales across existing branches this year, a sharp acceleration from the 4 per cent dip recorded in 2024.
"The situation is akin to a ship that must constantly jettison cargo to stay afloat," Sorathep told Thansettakij. "For smaller operators, the priority has shifted from rewarding staff to pure survival."
Structural Shifts in Labour
To navigate this downturn, the sector has undergone a fundamental structural shift over the past 24 months.
Operators are aggressively reducing their permanent workforce, opting instead for student part-time labour, particularly during high-traffic weekend periods.
This strategy allows businesses to bypass the heavy burden of fixed welfare costs and the upcoming hike in Social Security contributions.
From 1 January 2026, a new Social Security contribution base will increase the monthly deduction for employees earning 20,000 baht from 750 baht to 850 baht—a move that increases the financial strain on both the employer’s payroll and the worker’s take-home pay.
Faltering Growth Targets
The industry’s pessimism is rooted in Thailand’s broader macroeconomic performance. While the private sector initially hoped for a 4 per cent GDP expansion, current forecasts suggest growth will struggle to breach the 3 per cent mark.
Sorathep criticised the government’s reliance on short-term populist stimulus, arguing that "handout" programmes provide only a fleeting boost to purchasing power.
"What operators require are sustainable, long-term economic strategies driven by experts," he noted. "If the overall economy is robust and the public has genuine purchasing power, the restaurant trade will recover organically without the need for temporary life support."
For now, the Thai dining scene remains in a defensive crouch, trading long-term stability for the short-term flexibility of a gig-economy workforce.
