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Global downturn threatens poverty goal

An unemployed man sleeps on a bench along Manila Bay. The Philippine economy is taking a hit from the global financial crisis as millions of Filipino workers based abroad stand to lose their jobs. Jason Gutierrez/IRIN
Vangie Kelseat joined the unemployed when the global financial crisis began taking its toll. After working 12 years at a car-seat cover manufacturing company in Manila, Kelseat was laid off in October.

About 300 co-workers were also laid off last year and like Kelseat, many have not found proper jobs. Kelseat survives by offering manicures and pedicures from one household to another.

But it is proving a hand-to-mouth existence for the 42-year-old single parent. From earning more than US$10 a day, she now receives less than half that and the mother-of-four is struggling.

Yet her opportunities are limited. Kelseat thinks she is too old to undergo skills training and now hopes to take out a loan to start her own business.

Thousands of jobs at risk

The National Economic Development Authority projects that 800,000 workers are vulnerable to retrenchment due to the downturn.

These include workers in export-oriented industries, particularly semi-conductors and electronics, as well as Filipinos employed abroad, said Socio-Planning Economic Secretary Ralph Recto.

Labour Secretary Marianito Roque reported that since October at least 34,000 people have been laid off, with this year’s job losses expected to reach 300,000.

In October, government data showed unemployment in October at 2.53 million, while those underemployed, or whose jobs do not fit their education or skills, numbered about six million.

However, the IBON Foundation, an independent think-tank, estimates that unemployment and underemployment are above 10 million, possibly hitting 11 million this year.

Poverty goal

Yet with the global financial crisis wreaking havoc on local employment, addressing basic labour issues such as providing decent work has become more difficult to achieve – potentially undermining the Millennium Development Goal of eradicating poverty and hunger.

Productive employment and decent work have been integrated as one of the key indicators in achieving this goal.

About 25.4 million Filipinos are estimated to be living below the Asian Poverty Line of $1.35/day, roughly one in three, while the MDG-1 target aims to halve the number of Filipinos living in extreme poverty - 12.7 million - by 2015.

Even before the International Labor Organization (ILO) successfully advocated for the inclusion of productive employment and decent work in the MDG in 2006, the Philippines had began laying the groundwork in pursuing these goals, involving the tripartite participation of the government, labor and employers’ groups.

Dubbed the Philippine Common Agenda, it covered three cycles beginning in 2002. The last cycle, covering the period 2008-2010, has the theme “Narrowing Decent Work Deficits” as an action framework.

Decent work

Julius Cainglet, a member of the technical working group of the National Tripartite Advisory Council of the Decent Work country programme, said the financial crisis “has made it more difficult to achieve the MDG goal as far as decent work is concerned”.

The decent work framework, he said, sought to push issues such as rights, promotion of employment, social protection and social dialogue among government, workers and employers.

But some companies are using the financial crisis to lay off workers and hire contractual ones, effectively undermining these goals.

“We have received reports from our unions that regular workers are being replaced by contractual ones,” he said.

Other firms are using the financial crisis as an excuse to compromise labour standards on the pretext of cost-cutting.

Some are employing fewer work days or work hours, while others resort to immediate closures without a month’s notice as required by law.

The government has announced a $6 billion economic recovery package, of which $2 billion is for infrastructure projects, to cushion the financial crisis’ impact. But the jobs are mostly on a contractual basis.

According to Roque, while the decent work agenda faced obstacles because of the crisis, “it remains a centrepiece of our department. It has become more imperative to protect the workers.”


This article was produced by IRIN News while it was part of the United Nations Office for the Coordination of Humanitarian Affairs. Please send queries on copyright or liability to the UN. For more information: https://shop.un.org/rights-permissions

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