Will Cambodia survive the sea of new workers?
Reports from local unions describe the situation as “extremely grave,” even as government spokesperson Sun Mesa has emphasized a focus on job creation, placement, and support to help labor and industry work together.
Nearly one million migrant workers have returned from Thailand since border tensions escalated in June 2025. Despite truce agreements between the two countries, workers say they continue to brace for the fallout that has thrown their lives into confusion and uncertainty.
The Cambodia Development Resource Institute has described the situation as “one of the most significant labor-market adjustments in its modern economic history.” Estimates from Cambodia’s Ministry of Labor and Vocational Training suggest that 1.2 million Cambodians were working in Thailand when border disputes began to escalate in June.
As festivities for the Khmer New Year begin in Cambodia on Tuesday, April 14, migrant workers say the celebrations feel muted. Their return has been “tense” and their financial situations are “very worrying.” Many say they are trying to pick up the pieces, often taking jobs that do not match their skills that offer considerably lower earnings than what they made in Thailand.
While many still hope to return eventually, Thailand has begun taking steps to diversify its migrant labor force. According to updates in March, the Thai labor ministry has indicated that it will not reopen land border crossings anytime soon, adding further uncertainty for workers who once depended on cross-border mobility.
Meanwhile, the Cambodian economy has been affected on multiple fronts. Remittances from migrant workers dropped from $2.95 billion to $1.86 billion in 2025, a decline of 37 percent. At the same time, the fallout from conflict in the Middle East has sharply increased costs, with diesel prices rising 113 percent, petrol up by 42.8 percent, and liquefied petroleum gas increasing by 95 percent since the end of February.
The Asian Development Bank (ADB) now projects GDP growth of 4.5 percent, down by 0.7 percentage points from earlier estimates. These overlapping pressures have compounded the challenge facing policymakers.
The push to reintegrate returnees and find sustainable employment has become a central concern. “We have absorbed more than 250,000 workers,” Ken Loo, secretary general of the Textile, Apparel, Footwear and Travel Goods Association of Cambodia (TAFTAC) told Sourcing Journal. “Most workers required training. The government rolled out a program, and our training institute did the same, with support from the Skills Development Fund.”
The garment, footwear, and travel goods sectors have shown dramatic growth in 2025, reaching approximately $16 billion in exports. Apparel exports alone grew by 16.5 percent compared to the previous year, totaling $11.4 billion. This expansion has provided some capacity to absorb returning workers, though not without complications.
Several initiatives have been launched to help workers transition quickly into these sectors. The National Employment Agency (NEA), for example, has introduced a seven-day “earn while you learn” sewing program, designed to train workers to operate sewing machines while also giving them a basic understanding of the industry. The program is free and includes direct pathways to employment in factories, offering a relatively fast track into the formal labor market.
“Many of the workers who returned from Thailand have indeed been contracted by garment factories, despite their skills being somewhat different from those sought by the sector,” Massimiliano Tropeano, a sustainability and garment sector consultant, told Sourcing Journal. However, he noted that even with targeted training, worker commitment has not always followed. “Retention has been somewhat problematic, with some workers leaving factories soon after being employed and trained by their own choice. Official ballpark figures have been provided by the government; however, it is difficult to assess the actual retention numbers,” he said.
In his estimate, retention rates are close to 50 percent, suggesting that nearly half of newly placed workers do not remain in their positions for long. This churn highlights deeper issues, including mismatches between expectations and working conditions, as well as the lingering appeal of migration.
Tharo Khun, program manager at the Center for Alliance of Labor and Human Rights (CENTRAL), offered a similar assessment. “A considerable share of returnees remain unemployed or economically vulnerable, and many of the jobs obtained are temporary, informal, or not aligned with workers’ prior skills and experience. Many workers have faced wage theft, unsafe conditions, and misleading job offers, which have increased re-migration pressure,” he said.
An impact assessment conducted by CENTRAL on March 21 documented the conditions faced by Cambodian migrant workers returning from Thailand during the 2025 border conflict. The report found that the return was overwhelmingly crisis-driven and self-financed, with unofficial fees and bribes at border crossings compounding financial losses. For 8 percent of respondents, the act of returning home itself created new debt. Only 30.5 percent of returnees received any form of assistance during or after their return, and most of that support was limited to short-term food aid and transportation.
This surge far exceeds the exodus during the Covid-19 period, when roughly 260,000 migrants returned. The current wave is already placing significant strain on Cambodia’s economy and on the well-being of its people. Before the border conflict, remittances from Cambodian migrant workers in Thailand were a vital contributor to the national economy. Workers typically sent home several hundred dollars per month to support their families, amounting to nearly $3 billion in 2024.
One of the most immediate challenges is the simple lack of sufficient jobs. The CENTRAL report also highlighted geographic and sectoral mismatches. “Most of the jobs that do exist are in and around Phnom Penh and other urban centers, while most returned migrants are living in provinces along the Cambodia-Thai border,” the report noted. It added that “most of the advertised jobs are in the manufacturing sector, while many returned migrant workers have developed skills in construction and large-scale agricultural work to meet the demands of Thailand. It will be a challenge for many of them to find work that utilizes their existing skills.”
The report, endorsed by several organizations including the Cambodian Alliance of Trade Unions (CATU) and the Cambodian Center for Human Rights (CCHR), described the situation as a “profound challenge that demands coordinated action by the government, the private sector, and civil society to secure decent livelihoods for returning migrant workers.”
Tharo Khun also pointed out that 53 percent of workers surveyed planned to migrate again, compared to just 13 percent in an earlier survey conducted in August. This sharp increase underscores the fragility of current reintegration efforts and the continued pull of overseas employment.
Sun Mesa, spokesperson for the Ministry of Labor and Vocational Training, said last week that more than 650,000 workers have already found employment with government support. He outlined a process for recognizing the skills of returning workers, with the government issuing certificates to validate their experience. Addressing concerns about lower wages in Cambodia, he stated that workers would receive competitive salaries along with access to healthcare through the National Social Security Fund (NSSF), occupational risk insurance, and pensions.
“In Cambodia, there are plenty of jobs that offer decent income. Even those without skills can join short-term training courses and receive support from the first day of enrollment. There is nothing to worry about,” he said, adding that the government had reviewed CENTRAL’s impact assessment.
However, many in the industry have questioned the accuracy of employment figures and the extent to which jobs are stable or adequately paid. Analysts note that the renewed visibility of CENTRAL as a workers’ advocacy group has been significant in shaping public debate.
The organization itself has faced controversy and scrutiny over the last two years.
On June 28, 2024, the Ministry of Interior requested that the National Audit Authority of Cambodia conduct an audit of CENTRAL, and a “national security” audit was launched on July 15, 2024. This came shortly after CENTRAL published a report evaluating the effectiveness of Better Factories Cambodia (BFC), a joint initiative of the International Labor Organization (ILO) and the International Finance Corporation (IFC) aimed at improving working conditions in the garment sector.
CENTRAL’s report raised concerns that BFC was failing to adequately identify violations related to freedom of association in participating factories. It also recommended greater transparency, including making compliance reports accessible to workers and establishing grievance mechanisms to allow them to contest findings.
“During the smear campaign, there was a lot of pressure on our organization, both externally and internally,” said Tharo Khun. “We have a broad coalition of partners in consuming countries, and while many brands spoke up, including Puma, Adidas, and PVH, among others there was also pressure from policymakers in the European Union and from the U.S. trade representative. In December 2024, they closed the audit,” he said.
He described this outcome as a major win for the sector, but emphasized that the focus remains on building dialogue and improving conditions for workers.
“Our impact assessment on returned migrant workers shows the lack of an effective emergency response and highlights the economic shock faced by households. If we want to attract more investment from foreign companies and create jobs, there must be meaningful reforms and a clear trend toward supporting labor. It is very challenging to open new factories, and costs remain high,” he said.
As Massimiliano Tropeano noted, the garment, footwear, and travel goods sector—still the main driver of export growth—continued to expand in the first quarter of the year, with growth of 7.8 percent from January to March. However, he also pointed to warning signs. “There has been a significant decline in the imports of raw materials, which serve as an indicator of future orders, with a slump of 26 percent. The recent downturn is likely influenced by the logistics crisis in the Middle East and rising fuel costs. These developments could lead to lower exports in the third quarter of 2026,” he said.
Analysts say that, given the ongoing conflict in the Middle East, the continued closure of borders between Thailand and Cambodia, and heightened scrutiny of illicit activities such as scam centers operating in the region, Cambodia’s economic outlook remains delicately balanced.
“But we have to continue with reform, we have to show political will,” said Tharo Khun. “We need to be clear what the trends of the labor market are, how these can create jobs. We are trying to ask migrant workers to call the hotline, or use a QR code to connect. Even now, migrant workers are facing tremendous challenges in terms of their livelihood.”
