Costs and Benefits of Cross-Country Labour Migration in the GMS

4. Economic Costs and Benefits of Labour Migration: Case of Thailand

4 Economic Costs and Benefits of Labour Migration Case of Thailand Srawooth Paitoonpong, Yongyuth Chalamwong, Chothiga Sukaruji, and Angkana Piamkulwanich 1. Introduction Migration is a global phenomenon and is both beneficial and detrimental to most countries. At the macro level, emigration can reduce unemployment and attract extra income through remittances (income sent home) to home countries, which can in turn contribute to development and help reduce poverty. Additionally, emigrants often return with new ideas and technology. Immigration increases labour supply and occupational mobility while reducing wage-push inflationary pressure. This can lead to more productive uses of capital, increased exports, and greater economic growth. On the other hand, migration can lead to a “brain-drain” as educated and talented individuals take their skills elsewhere. Labour shortages, increased wage costs and reduced economic growth are also problems for countries with high emigration. An increased flow of immigrants into a country places great strain on infrastructure and public services such as housing facilities, schools, and medical services. 04 Costs_Benefits.indd 242 6/21/12 10:59:18 AM Economic Costs and Benefits of Labour Migration: Thailand 243 At the micro level, remittances bring great economic benefits to recipient individuals and can improve their well-being. However, the social costs can also be huge for both the migrant and the family left behind. The loneliness and homesickness often experienced by the migrant can lead to deterioration in physical and mental health, exacerbated by the lack of local language skills that can leave migrants feeling isolated. At home, marriages can break down and children are forced to live without their father or mother for long periods of time. Migration also exacerbates problems such as the spread of HIV/AIDS and crime. Despite its obvious impact and importance, there is a lack of information about the costs and benefits of migration in many countries. More research is needed to help formulate new policies on migration and strengthen existing ones. This country study, along with its partner studies in Lao PDR, Cambodia, and Vietnam, aims to help fill this information gap by providing an evaluation and comparison of the benefits and costs of migration in Thailand. It focuses specifically on the economic costs and benefits, but does touch on social issues as well. Its research methodology consists of two main parts: the national analysis and the micro analysis. The national or macro analysis is based mainly on the review of secondary data and extant studies on the costs and benefits of labour migration in Thailand, and it examines emigration and immigration. The micro analysis comprises an emigration case study of Thai workers who worked in Taiwan and an immigration case study of migrant workers from Lao PDR and Cambodia in Thailand. An examination of the economic benefits and costs1 of migration should be useful to the government for labour policymaking, and it should provide guidance for further studies on this and related topics. Section 2 provides a brief background of migration in Thailand, while Section 3 describes the case methodology and profile. Sections 4 and 5 analyse the results of the case studies in relation to the benefits, costs, and household impact of migration. Section 6 very briefly presents the major issues. Conclusions and recommendations are presented in the final section. 2. Background 2.1 History For some time now, Thailand has been receiving migrant workers and seeing many of its citizens emigrate to work in other countries. However, the balance between immigration and emigration has changed over the 04 Costs_Benefits.indd 243 6/21/12 10:59:18 AM 244 Srawooth Paitoonpong et al. last two decades, thanks to Thailand’s rapid economic growth. From 1970 to 1980, Thailand experienced more worker emigration than immigration, with many Thais leaving Thailand to find work in the Middle East, Taiwan, Brunei, Hong Kong, Singapore, and Japan. By the early 1990s, workers from neighbouring low-income countries migrating to Thailand outnumbered the Thai workers leaving the country. Most of the migrant workers in Thailand are from Myanmar, with smaller numbers from Cambodia, China, Lao PDR, and South Asian countries 2.2 Emigration The main motive for Thai workers seeking jobs abroad is economic: to find a job and/or earn higher income. However, emigration often incurs excessively high recruitment costs and prospective migrants run the risk of being exploited. Thai workers, legal and illegal, were not fully protected under Thailand’s labour laws until the Thai...