Philippines moves to save jobs and businesses impacted by Covid-19 crisis

05, Mar. 2020

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MANILA, NNA – The Philippine Labor Department (DOLE) have urged employers especially in the tourism sector to adopt flexible work arrangement amid concerns that thousands of jobs might be at risk if the global coronavirus crisis drags on.

In an advisory on Wednesday, the department said it is also planning financial assistance to keep businesses afloat in affected sectors.

DOLE said 35 tourism-related establishments employing 3,255 workers in three regions have already introduced flexi-work such as reducing work hours or work days, staff rotation and forced leave.

“The employers and the employees are encouraged to explore other alternative work arrangements in order to cushion and mitigate the effect of the loss of income of the employees,” DOLE said.

“If the global outbreak is indeed far from over and could last up to June or December, our Overseas Filipino Workers (OFWs) and workers at home could be thrown in a gauntlet,” warned Labor Secretary Silvestre Bello III during a press briefing on Wednesday.

Labor undersecretary Ana Dione said having flexi-work arrangement as a temporary measure would help companies to tide over difficulties.

“If the virus prolongs, there would be no clients for the company. The first thing the firm would do is to fire employees. We want to prevent that. That is why we suggest to do (a flexible work arrangement) so that everybody will be kept afloat,” Dione said during the briefing.

Tourism is the worst-hit among the sectors, as visitor arrivals would continue to fall since the deadly virus has spread from Asia to many other countries throughout the world.

The tourism and travel sectors contributed 24.7 percent to the Philippine economy in 2018 and hired 26.4 percent of the labor force, according to a report published by Fitch Solutions on Tuesday. The tourism sector alone employed 5.4 million workers or 13 percent of the work force in the country in 2018, according to the Philippine Statistics Authority.

South Korea has been the top tourist market of the Philippines since 2010, with arrivals reaching 1.98 million in 2019 or a 22.5 percent jump since then. China is next with 1.74 million arrivals, representing a 38.6 percent growth since 2010. Visitors from these two countries are also the top spenders in 2019, according to tourism department data.

The Fitch report said, "The Chinese government’s order for the suspension of international tour sales on January 24 and outbreaks across the region, particularly in South Korea, is likely to result in a slump in arrivals and sentiment for the related industries."

In early February, the Philippines imposed a ban on visitors coming from China, Hong Kong and Macau. The Philippines will likely see a drop in arrivals from South Korea after it reported 3,736 Covid-19 cases on Sunday, it said.

The Fitch report added, "We expect tourist receipts to weaken as a result given that South Koreans account for 25 percent of inbound arrivals to the Philippines."

On Monday, Associated Labor Unions-Trade Union Congress of the Philippines (ALU-TUCP), the biggest labor group in the country, warned that about 7,000 Filipino workers might lose their jobs if the Covid-19 disruption worsens.

Just last month, Philippine Airlines laid off 300 employees as part of business restructuring as well as losses due to travel restrictions as a result of the contagion.

However, labor secretary Bello allayed fears of any widespread job cuts in affected countries like Hong Kong, Macau, Taiwan and Japan amid reports of Filipinos losing jobs overseas.

“There are isolated cases. By and large, there is no alarming rate of unemployment of overseas workers,” he said.

Apart from those in tourism, overseas jobs, particularly sea-based ones for seafarers, may be impacted, said Tanjusay.

“According to shipping industry (sources), there are no orders for Filipino seafarers now for cruise ships…because of the virus,” he told NNA in a phone interview.

Fitch has said in its report that the virus outbreaks on the Diamond Princess and MS Westerdam could dampen demand for cruise holidays and pose a threat to Filipino employment on ships and remittances.

Sea-based Filipino workers is the second top source of remittances for the country, according to Philippine central bank data.

The National Economic and Development Authority has estimated the impact of the coronavirus crisis to reduce up to 1 percentage-point from economic growth.

Meanwhile, the Covid-19 virus has spread to four more countries - Argentina, Chile, Poland and Ukraine, pushing the number of countries with reported infections to 77.