Up to 300,000 people could lose their jobs in the Philippines over the next six months as the global financial crisis deepens, Labor Secretary Marianito Roque warned on Wednesday.
Some 15,000 had been laid off over the past two months while 19,000 others had their workweek cut to four days or less, he told reporters.
Roque said that a “worst-case scenario” would see the number of jobless rise to between 250,000 and 300,000 by the end of June.
He described the job cuts so far, which include more than 10,000 in the Calabarzon industrial belt south of Manila, as being within the “manageable level” in relation to a nationwide workforce of about 37 million. Calabarzon took its name from the provinces of Cavite, Laguna, Batangas, Rizal and Quezon.
North of Manila at the Subic Bay Metropolitan Authority (SBMA), operations of about 20 companies and more than 4,000 employees there have been affected by the crisis since late last year, according to official data.
Two companies have folded up—Harbour Yacht Trading Services Corp. in December last year and Cacho Hermanos this month. Air 2100 Inc. is expected to shut down in February. A total of 84 employees would lose their jobs from these closures.
Four other companies would be retrenching a total of 530 workers soon. Chan Soong International Subic Inc. would lay off 32 employees in February; In Young Philippines Inc. would cut two jobs; Subic Power Corp. would retrench a total of 76 workers—71 in February and five more in April; and Winstron Infocomm Philippines Corp. will cut 420 jobs also in February.
Several other companies have been enforcing or would soon implement forced leaves for their workers: Ichiban Import-Export Corp., Jeannie’s Touch, Limech Garments Manufacturing Corp., Nakayama Precision, Nidec, Phil Inter Electronics Corp., Powerlane Resources Inc., Sanritsu Technology Subic Inc., Sanyo Denki, Subic Bay Apparel Corp., Subic Bay Satellite Systems Inc. and Taian Subic Electric.
Some of these companies already imposed leaves among their employees as early as March 2008, while others would do so in the first two months of 2009. A total of 4,281 workers would be made to go on forced leaves.
Also north of Manila at the Bataan Economic Zone, the Japanese company Mitsumi Philippines also on Wednesday announced that it had laid off 134 workers whose contracts expired on December 31, 2008 and compressed work days from six to five days a week of 3,314 employees because of declining orders for its products. It cited the global economic crisis.
Noble Metals, a 100-percent Filipino firm engaged in metal plating, has served notice of a two-month temporary shutdown effective February 20, 2009 that will affect 32 workers.
Mitsumi and Noble are two of the 42 multinational companies operating at the economic zone located in Mariveles town. The 42 companies have a total workforce of 14,426.
William Verzon, Mitsumi Phils personnel manager, denied reports that the company producing electronics components had just laid off 2,400 workers. Mitsumi began operating in Mariveles in 1980.
Unemployment in the Philippines currently stands at 6.8 percent.
The government is holding talks with employers’ groups to ease the fallout from the global economic downturn, which has heavily hit the country’s two top export earners, electronics and garments, where most jobs have gone so far.
Manila, according to Roque, has asked business groups to prepare measures to mitigate the impact on their workers and use job cuts only as a last resort.
Job creation is seen as tough in the Philippines, where some 27 million people live on a dollar a day or less and where one in three adults is unemployed or underemployed, according to official data.
Jennifer Manalili, head of the Labor department’s Philippine Overseas Employment Administration, said that as a last resort Manila could export more of its workforce.
There is an unmet demand for 389,000 jobs abroad, including more than 100,000 in Qatar and 12,000 in Kuwait, Roque said.
A leading cement manufacturer seemed to be looking at the bright side.
Holcim Ltd. also on Wednesday said it “has no plans to cease” operations of its plants in the Philippines, although there could be temporary shutdowns of production lines.
“We will continue to run our plants and, in fact, expect improvements in our manufacturing efficiencies again this year,” Holcim Philippines chief operating officer Ian Thackwray said in a statement.
Investments to improve its facilities made last year showed that “we’re here to stay, and that we remain committed to doing everything we can to maintain our position as market leader,” he added.
Thackwray, however, said that there could be “short shutdowns” with supply already outpacing demand, even as he stressed none of the company’s 1,500 local employees would be retrenched.
“This [temporary shutdown] might happen more when demand is soft, but it’s a normal occurrence,” he pointed out. “Since these are temporary, they will not result in any job losses.”
Holcim Philippines, part of Switzerland-based Holcim Group, is the country’s top cement manufacturer with four plants with total annual production capacity of 7.7 million tons.
The Philippines is to announce economic growth figures for 2008 on Thursday but it has said that Gross Domestic Product (GDP) growth may come in at between 4.2 and 4.5 percent after a 30-year high of 7.2 percent in 2007. GDP is the total value of goods and services produced in a country in a year.
It has reported massive job cuts in the key electronics and garments sectors since December as the global financial crisis softens demand for the export items.
— Ben Arnold O. De Vera, Ernie B. Esconde And AFP