NESDC cites potential THB62 billion El Niño damage to Thai agriculture
Thailand had 41.5 million people in work in the second quarter, while the unemployment rate edged up and the household debt-to-GDP ratio fell to 85.9% in the first quarter.
- Thailand's National Economic and Social Development Council (NESDC) projects that the El Niño weather event could cause THB62 billion in damage to the nation's agricultural sector.
- The impact is expected to last through the first half of 2027, with rice being the most affected crop, accounting for an estimated THB43 billion of the total losses.
- The NESDC warns the event could intensify into a "super El Niño" in late 2026, leading to a projected 8.0% drop in farmers' income for the year.
Danucha Pichayanan, secretary-general of the Office of the National Economic and Social Development Council (NESDC), briefed on Thailand’s social outlook for the second quarter of 2026 on Monday (August 24, 2026).
He said key indicators had improved overall, particularly employment and the household debt-to-GDP ratio.
Employment continued to improve.
The number of people in work stood at 41.5 million, up 5.1% from the same period in 2025.
Employment rose in both the agricultural and non-agricultural sectors, with construction recording the strongest growth.
The broader picture was positive, but unemployment also increased.
The overall unemployment rate edged up to 0.95%, equivalent to about 400,000 people.
The number of quasi-unemployed people rose by 8.0%, while the number of long-term unemployed people increased by 11.3%.
NESDC highlighted three labour issues requiring urgent attention.
Employee Welfare Fund law
Enforcement of the law is scheduled to begin on Thursday (October 1). It will cover nearly 110,000 establishments and 5.7 million employees.
The government must urgently raise awareness and ensure the necessary systems are ready.
El Niño risks
Drought had already begun to affect several areas, and the effects were expected to continue into the first half of 2027.
This could directly affect agricultural output and farmers’ income, prompting some workers to leave their home areas for jobs in other economic sectors.
Danucha said the El Niño event affecting Thailand could intensify into a super El Niño late in 2026.
Several areas had begun to experience drought because of lower rainfall and longer dry spells.
A report on agricultural disasters between April 1 and July 9 found that drought had affected five provinces, 1,383.36 hectares of farmland and 4,453 farmers.
A Krungthai COMPASS study estimated that El Niño would continue to have an impact through the first half of 2027, causing THB62 billion in agricultural losses.
Rice was expected to be hit hardest, with damage estimated at THB43 billion.
Farmers’ income was projected to fall by about 8.0% in 2026.
This could reduce demand for agricultural labour and accelerate the movement of some workers into other economic sectors.
Preparations should focus on promoting low-water-use crops for which there is market demand.
In the longer term, drought-tolerant varieties should be developed alongside more efficient water management to reduce the impact on agricultural income and employment.
Illegal work in reserved occupations
The number of migrant workers found in breach of restrictions on occupations reserved for Thais has increased.
More than 3,217 people were identified in fiscal 2026, up 19.3% from the previous year.
This requires stricter enforcement of the law.
Household debt data were based on the first quarter of 2026.
Total debt stood at THB16.41 trillion, an increase of just 0.5%. Because the Thai economy grew more quickly, the household debt-to-GDP ratio fell to 85.9%.
Credit quality also appeared to improve.
The credit bureau database showed that loans more than 90 days overdue, classified as non-performing loans (NPLs), totalled THB1.25 trillion.
They accounted for 9.20% of total loans, down from 9.59% in the previous quarter, with declines across all loan categories.
NPLs in the commercial banking system stood at THB170 billion, or 3.25%.
However, NESDC remained concerned about the proportion of loans 31–90 days overdue, known as SMLs.
The proportion continued to rise, creating a risk that these loans could later become NPLs.
NESDC also identified two specific risks requiring attention.
Multiple-home borrowing
Housing-loan borrowers held an average of 1.08 loan accounts each.
NESDC said this reflected borrowing to buy several housing units within a short period, raising the risks of speculation and default.
It recommended developing the credit-reporting system so that credit information could be reported more frequently.
Problems after debt restructuring
SCB EIC data showed that only 15.0% of debtors taking part in government assistance measures had been able to resume normal repayments.
NESDC said urgent action was needed to prevent bad debts from continuing to accumulate in the system.
