Cambodias Employment Rate Amid Scam Crackdown and Declining Chinese Tourism

Cambodia’s job market is sending two different signals at once. On paper, employment remains high and the official unemployment rate is still very low by global standards. On the ground, workers tied to tourism, casinos, construction, transport and informal services are feeling pressure from two linked shocks: the crackdown on scam operations and the sharp decline in Chinese tourist arrivals compared with the pre-pandemic peak.

This makes the headline employment rate hard to read. Cambodia has long had a labour market where many people work, but not always in stable, well-paid or formal jobs. When demand falls, workers often shift into informal trading, family businesses, farming, delivery work or short-term construction instead of becoming officially unemployed. The result is a labour market that looks strong in broad statistics but feels weaker for people whose income depends on tourism and foreign investment.

Some areas built around foreign visitors now face a slower recovery (AI Generated)

The headline employment rate does not tell the full story

Cambodia’s unemployment rate has usually been reported at under 1 per cent in recent international and official labour datasets. That looks healthy, especially when compared with many economies in the region.

But Cambodia’s case is different. A low unemployment rate does not always mean secure work. It can also mean that people cannot afford to stop working, even when wages fall or hours shrink.

A garment worker may move to casual selling. A tuk-tuk driver may take fewer trips but remain “employed”. A hotel cleaner may return to a province and help with family farming. These people do not always appear as unemployed, yet their cash income may drop sharply.

That is why the better question is not only “What is Cambodia’s employment rate?” It is also:

• Are people working enough hours?

• Are wages keeping up with living costs?

• Are jobs formal or informal?

• Are workers moving into lower-paid sectors?

• Are young people finding stable first jobs?

  
  

Seen this way, Cambodias Employment Rate Amid Scam Crackdown and Declining Chinese Tourism is less about mass unemployment and more about income stress, job quality and uneven recovery.

The scam crackdown is reshaping local jobs

Cambodia has faced intense attention over online scam operations, especially in areas linked to casinos, real estate and foreign-run compounds. Authorities have carried out crackdowns, raids and deportations, while international pressure has pushed the government to act more visibly against cyber-fraud networks.

This matters for employment because scam-linked activity did not exist in isolation. Around it sat a wider service economy.

Some workers were directly involved in illegal operations, including trafficked or coerced people. Others worked nearby in food stalls, rental housing, transport, cleaning, security, repairs and entertainment. When a compound shuts down, legal and illegal income streams can both disappear from the surrounding area.

The crackdown is necessary from a law enforcement and human rights perspective. Scam centres have been tied to forced labour, trafficking and organised crime. Yet the short-term economic hit can still be real in places where local spending had become dependent on questionable activity.

Sihanoukville shows this tension clearly. The city grew quickly during the casino and construction boom, much of it linked to Chinese investment and visitors. When that flow slowed, empty buildings, stalled projects and weaker street-level spending left many workers exposed.

Transport workers often feel tourism slowdowns before official data shows the impact (AI Generated)

Fewer Chinese tourists mean fewer service jobs

Before the pandemic, Chinese visitors made up a major share of Cambodia’s international tourism market. They supported hotels, restaurants, casinos, tour companies, airport transport, souvenir shops and nightlife businesses.

Chinese tourist numbers have recovered only partly compared with the earlier peak. Several factors help explain the slower comeback:

• China’s outbound travel recovery has been uneven.

• Air connectivity and travel costs have changed.

• Safety concerns have grown because of scam and trafficking reports.

• Cambodia faces stronger competition from other regional destinations.

• Some casino-led tourism has weakened after tighter controls.

  
  

This decline does not affect all of Cambodia equally. Siem Reap depends heavily on cultural tourism around Angkor. Phnom Penh has more business, government and domestic demand. Coastal areas such as Sihanoukville are more exposed to the fall in casino-linked and Chinese package travel.

For workers, the impact is practical. Hotels may hire fewer cleaners. Restaurants may run shorter shifts. Tuk-tuk drivers may wait longer between passengers. Construction workers may see fewer new projects. Young people who once expected easy work in tourism towns may return to provinces or seek factory jobs.

The labour market is shifting, not collapsing

Cambodia’s employment situation is better described as a shift than a collapse. The garment, footwear and travel goods sector still employs many workers, especially women. Agriculture continues to absorb labour in rural areas. Domestic tourism also supports local businesses, though it cannot fully replace high-spending foreign arrivals.

Construction remains important, but it no longer has the same easy momentum seen during the investment boom. Some buildings that were planned for casinos, hotels or apartments now face weaker demand. That means fewer jobs for builders, electricians, drivers, maintenance workers and suppliers.

Informal work is taking on more of the burden. Street vending, small food businesses, ride-hailing, delivery and casual labour give people a way to earn, but these jobs often lack paid leave, social protection and predictable income.

This is why Cambodia can have a low unemployment rate while many households still feel financially insecure.

Informal work helps absorb job losses, but incomes can be uncertain.

What could support employment now

Cambodia does not need to choose between law enforcement and jobs. It needs both. The scam crackdown can improve Cambodia’s reputation if it is consistent, transparent and paired with support for legitimate business.

Several moves would help strengthen employment:

Rebuild traveller confidence

Clear safety messaging, stronger policing of trafficking networks and better visitor support can help restore confidence. Tourists need to feel that Cambodia is safe, not only cheap or convenient.

Diversify tourism markets

Cambodia should keep welcoming Chinese visitors, but it cannot rely too heavily on one market. More focus on travellers from ASEAN, South Korea, Japan, India, Europe and domestic tourism would reduce risk.

Support small businesses

Small restaurants, guesthouses, drivers and vendors need practical help, such as easier licensing, skills training and access to fair financing. These businesses create many jobs quickly when demand returns.

Improve job quality

A low unemployment rate matters less if many jobs are insecure. Better training, stronger labour protections and clearer routes into formal work would make Cambodia’s labour market more resilient.

Turn empty assets into productive use

Unfinished buildings and underused tourism areas could be repurposed where possible for education, housing, local commerce or lawful hospitality projects. Leaving them idle weighs on confidence and employment.

The outlook depends on trust

Cambodia’s near-term employment outlook depends on trust. Visitors need trust that they can travel safely. Investors need trust that the legal environment is stable. Workers need trust that jobs will be lawful, paid and protected.

The scam crackdown may hurt some local income in the short run, especially in towns that became dependent on casino-linked or foreign-funded activity. Yet it can also create the conditions for healthier growth if it removes criminal networks and improves Cambodia’s image.

Declining Chinese tourism remains a serious challenge, but it also exposes a deeper lesson. A labour market built around narrow sources of demand is vulnerable. Cambodia’s next stage of job growth will need broader tourism, stronger local businesses and better-quality work.

Cambodia’s job market remains active, but many workers face a tougher income climate (AI Generated)

Cambodia’s employment rate may still look strong in headline data, but the real story sits beneath the number. The country is working, yet many workers are earning less, changing jobs or moving into informal work. The path forward is not simply to bring back the old boom. It is to build a safer, more diverse economy where jobs do not depend on scams, speculation or a single tourist market.