RETURNEES Filipino workers faced a tight labor market in the Philippines and losses in savings, revealing gaps in government reintegration programs, according to a report by the Asian Development Bank (ADB).
Thousands of Overseas Filipino Workers (OFWs) were repatriated to the Philippines during the coronavirus disease 2019 (COVID-19) pandemic, after most of their employers fired them or failed to renew their contracts .
“Although aggregate figures indicate that in 2020 remittances to the Philippines have declined much less than originally expected, the implications of this decline could differ and could even be severe for some households, depending on their income and their financial situation,” the AfDB said.
Remittances fell for the first time in two decades in 2020, slipping 0.8% year-on-year to $29.903 billion. However, the decline was better than the central bank’s forecast of a 2% contraction for the year as a whole.
In April 2020, the World Bank predicted a global drop of 20% in remittances for that year, as many migrants lost their jobs.
Despite the lower-than-expected decline in remittances, many returning Filipinos have been affected by the loss of wages. A third of male workers and 17% of female workers earned more than 50,000 pesos per month abroad.
“For these returning migrants, the pandemic has put a stop to this influx,” reports the report by AfDB economist Jong Woo Kang and consultant Ma. Concepcion G. Latoja said.
Many also did not receive their final salary or severance pay after their contracts were terminated, which reduced the money they took home. This loss of income jeopardized the consumption and savings of their households, which they had mainly spent on food, education and health.
“It is also possible that remittance recipient households at the bottom of the income scale are at risk of falling back into poverty,” the report says.
More than 325,000 OFWs were repatriated in 2020, according to Foreign Office data.
After returning, workers have struggled to find local jobs during the pandemic, with the unemployment rate climbing to 17.6% in April 2020.
“While the government aimed to ensure returning migrants find suitable employment as quickly as possible to make their return viable and sustainable, the domestic labor market has experienced challenges due to the pandemic,” the report said. “Some businesses hit by lost sales after months of strict mobility restrictions have had to close.”
Placement programs offered by the government have not always been effective in assisting returning workers, who have lost their local network and often worked in low-skilled jobs abroad, to find training and employment in the Philippines.
“There is room to improve existing systems that match skills supply with employment prospects to encourage OFW returnees to apply the skills they have learned overseas in their local occupations,” said the AfDB.
The lack of reliable government data on Filipino migrants has hampered reintegration management responses, he added.
The AfDB said the Philippine government should help prepare OFWs for their return, offering them resources through overseas employment offices.
“Reintegration initiatives should emphasize the role of health and social security through information and awareness campaigns, collecting data on the health of returnees and assisting OFWs to s register with the public health and social security systems. »
The policy recommendations also include expanded information gathering on migrants that can help the government better respond to their needs. Reintegration programs could also consider how OFW skills could help their communities.
The government could step up the use of technology that could match workers’ skills to local jobs and provide job training online.
“Online and digital platforms on income, savings and investment management could help returnees manage their finances with more confidence, even if they are no longer remittance senders.”
Remittances in the first 11 months of 2021 rose 5.2% year-on-year to $28.43 billion, according to central bank data. — Jenina P. Ibanez