Demographic Structural Change and Its Impact on Thailand’s Aggregate Human Capital: Evidence From a Human Capital Valuation Method Toward a Super-aged Society

Author Information

Narissara Charoenphandhu, Rangsit University, Thailand
Thoedsak Chomtohsuwan, Rangsit University, Thailand

Abstract

Human capital is a crucial driver of economic growth and national development. High-quality human resources, when appropriately supported in both quantitative and qualitative dimensions, contribute to improved quality of life and strengthen a country’s capacity for sustainable development. However, Thailand has been an aging society since 2005 and has now entered a complete aged society, with a strong tendency to become a super-aged society in the near future. This situation reflects significant demographic structural change, particularly declining fertility and a shrinking share of the working-age population, which may affect the country’s aggregate human capital. This study aims to examine the effects of demographic structural change on the human capital embodied in Thailand’s labor force. It calculates the value of human capital across occupational groups in both social science and science fields, and compares past and current demographic structures in order to analyze the impact of population aging on the country’s aggregate human capital. The findings indicate that Thailand’s transition toward an aged society has affected the aggregate value of human capital in both social science and science occupations. In the initial stage, the country’s overall human capital did not decline significantly and, in fact, tended to increase as older individuals remained economically active while younger cohorts continued to enter the labor market. Nevertheless, in the coming decade, the aggregate value of human capital is expected to decline in line with the contraction of the working-age population. These findings highlight the need for urgent public policy responses to address such changes, including fiscal measures and efforts to enhance labor productivity per worker, in order to promote human resource development and sustainable national development.

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