Unemployment In Laos Soared By 20 Percent In 2020
Source: Vientiane Times
The unemployment rate in Laos skyrocketed to 20 percent in 2020, a 10.6 percent increase compared to the figures for 2017, and the global Covid-19 outbreak was the main factor for the sharp increase in the number of jobless in the country.
The pandemic forced thousands of overseas Lao workers to return home, and at the same time, some domestic employers cut jobs after their businesses ran into financial difficulties.
At the opening of the 11th Party Congress on January 13, Prime Minister Thongloun Sisoulith spoke about the need for skill development in Laos. He referred to the results of a labour survey conducted in 2017 and said Laos had 4.7 million people out of its population of 6.9 million who can be employed.
The labour force had a total of 1.95 million people, or 40.8 percent of the people who can be employed, but only 1.75 million of them had been hired, and the unemployment rate was 9.4 percent.
Mr Thongloun said the Covid-19 outbreak increased the unemployment rate in Laos to 20 percent in 2020.
Last year, Laos’ economy also witnessed very slow growth, with the expansion of 3.3 percent significantly lower than the target of 6.7 percent because of the impact of natural disasters and the Covid-19crisis. The pandemic forced the suspension of numerous business operations and production, and impacted the hospitality and transport sectors, and this too contributed to the rising unemployment across the country.
The high rate of unemployment had become a key issue for the government, which is now seeking proper solutions to the problem over five years. Various mechanisms have been put in place to resolve this problem by focusing on restoring and stabilising the economy, strengthening micro, small and medium enterprises, effectively enhancing the business and investment environments, and boosting the tourism industry, agriculture and industry.
These measures are expected to expand the labour market and provide opportunities to job seekers. According to the five-year socio-economic development plan, the figure of employed people is expected to rise to 2.57 million from 1.75 million people in 2020.
The government will promote the employment of new recruits in the labour market and the economic sector in both rural and urban areas and the overseas labour market. It also plans to curb the unemployment rate to 15 percent within the next five years, down from the 20 percent of last year. The unemployment rate is expected to reduce by 1 percent each year.
The Vice President of the Lao National Chamber of Commerce and Industry (LNCCI), Mr Daovone Phachanthavong told Vientiane Times on Thursday about some key factors that could help boost employment in the future. He said Laos needs to attract foreign investments to implement big projects.
“As we know, domestic investors have limited funds. At the same time, improvements in the mechanisms for the ease of doing business and investment operations are needed,” he said.
Mr Daovone also said the expansion of the SMEs sector can create a lot of jobs. According to the government’s plan, it has set a growth rate of 2 percent a year for such enterprises. This expansion is expected to contribute 18 percent to gross domestic product.