Home Editors' Picks Most companies shelve expansion plans — survey
Most companies shelve expansion plans — survey
MOST companies have put expansion and investment plans on hold due to the coronavirus disease 2019 (COVID-19) pandemic, according to a survey released by the Employers Confederation of the Philippines (ECoP).
Results of the ECoP’s COVID-19 impact assessment survey showed 67% or 212 of the 347 respondents said their company postponed expansion or investment decisions.
“In a survey conducted by the ECOP from 27 March 2020 to 15 April 2020, a total of 347 enterprises responded regarding the impact brought about by the COVID-19 pandemic on business operations, work arrangements, and workforce planning,” the business group said, adding the respondents included 148 large companies and 115 micro enterprises.
A fourth or 26% of the respondents said their business had to shut down due to the enhanced community quarantine (ECQ) in Luzon that started in mid-March, while 24% said they slowed down operations or had a skeletal work force. Only four respondents said they are observing normal operations while 20% are on work-from-home setup.
For a fifth or 21.8% of the respondents, the main impact of the Luzon-wide lockdown was a decrease in demand for products and services, while 19% said it was the change in work arrangements and 10.3% said they had difficulties paying salaries.
While 38% of respondents said they expect operations to go “back to normal” a month after the lockdown is lifted, 37% said they expect normalcy to return within two to three months. Another 14% said it would take them six months to go back to normal.
More than 42.7% said they are well prepared to manage the current impact of COVID-19, but only two respondents said they are “very well prepared.” Meanwhile, 34.2% consider their companies poorly prepared.
More large enterprises consider themselves well-prepared, with 52.8% agreeing to the statement compared to 50.9% of medium-sized enterprises, 43.4% of small enterprises, and 31.3% of micro enterprises.
Up to 28% of respondents said they do not have a written business continuity plan but are now developing one, while another 28% said they do not have such a plan.
Asked how the pandemic influenced workforce planning, 64% or 213 of the companies surveyed have stopped hiring, while 9% or 31 firms said they laid off workers.
“For those enterprises which were forced to lay off employees, the number of laid-off workers ranged from 25-50% of their employees, while some had to lay-off more than 100 employees,” ECoP said in the survey report.
Some respondents said they kept the same number of employees but if the ECQ or pandemic continues in the next six months, they expect to implement job cuts.
Majority or 71% of companies have implemented flexible work arrangements.
Almost 30% allowed employees to use remaining leave credits during the lockdown, while 24.7% did not provide additional leave credits.
Most employers, or 56%, did not release 13th month pay in advance. Among those who have, 58% disbursed pro-rated pay.
Asked what kind of support they would need from the government, ECoP noted a majority of the large companies are interested in tax relief, while a majority of the MSMEs (micro, small, and medium enterprises) are interested in financial support for affected workers.”
The respondents also called for “relaxation of compliance and reporting burden during the transition period,” a moratorium on loan amortization, and unimpeded supply of food and raw materials.
Some respondents also asked the government to provide subsidies and create a rehabilitation fund for MSMEs. — J.P.Ibañez