Repatriated OFWs face tight job market in PHL

REPATRIATED Filipino workers faced a tight job market in the Philippines and savings losses, exposing gaps in the government’s reintegration programs, an Asian Development Bank (ADB) report said.

Thousands of overseas Filipino workers (OFWs) were repatriated to the Philippines during the coronavirus disease 2019 (COVID-19) pandemic, after most of their employers laid them off or did not renew their contracts.

“Although aggregate figures indicate that in 2020, remittance inflows to the Philippines declined much less than initially anticipated, implications of this decline could differ and might even be severe for some households, depending upon their income and financial conditions,” the ADB said.

Cash remittances fell for the first time in two decades in 2020, slipping by 0.8% year on year to $29.903 billion. However, the decline was better than the 2% contraction forecast by the central bank for the full year.

The World Bank in April 2020 projected a 20% global decline in remittances for that year as many migrants lost jobs.

Despite the lower-than-expected drop in remittances, many returning Filipinos were affected by the loss of wages. A third of male and 17% of female workers earned over P50,000 a month overseas.

“For these return migrants, the pandemic put an end to this inflow,” the report by ADB economist Jong Woo Kang and consultant Ma. Concepcion G. Latoja said.

Many also did not receive their final wages or separation pay after their contracts were terminated, reducing the money they brought back home. This loss of income put at risk their households’ consumption and savings, which they had mostly spent on food, education, and health.

“It is also possible that remittance-recipient households on the lower end of the income scale could risk sliding back into poverty,” the report said.

Over 325,000 OFWs were repatriated in 2020, data from the foreign affairs department showed.

After their return, workers found it hard to get local jobs during the pandemic as the unemployment rate shot up to 17.6% in April 2020.

“While the government aimed for return migrants to find suitable employment as quickly as possible to make their return viable and sustainable, the domestic labor market struggled due to the pandemic,” the report said. “Some firms impacted by loss of sales after months of strict mobility restrictions had to shut down.”

Job matching programs offered by the government did not always effectively help returning workers, who lost their local network and often held low-skilled jobs overseas, find training and employment in the Philippines.

“There is room to improve existing systems that match the supply of skills with job prospects to encourage OFW returnees to apply the competencies they acquired abroad in their local occupations,” the ADB said.

The lack of reliable government data on Filipino migrants hampered reintegration management responses, it added.

The ADB said the Philippine government should help prepare OFWs for their return, offering them resources through overseas labor offices.

“Reintegration initiatives must emphasize the role of health and social security through information and awareness campaigns, data collection on returnees’ health, and assisting OFWs in registering with public healthcare and social security systems.”

Policy recommendations also include expanded migrant information collection that can help the government respond better to their needs. Reintegration programs could also take into account how the skills of OFWs could help their communities.

The government could ramp up the use of technology that could match workers’ skills to local jobs, and offer online skills training.

“Online and digital platforms on managing income, savings, and investments could help returnees deal with their finances with more confidence even if they are no longer remittance senders.”

Cash remittances on the first 11 months of 2021 increased by 5.2% year on year to $28.43 billion, central bank data showed. — Jenina P. Ibañez