Ecozone firms ask govt: halt further ECQ extensions

By Elijah Felice Rosales, Businessmirror, 20 Apr 2020

MORE than 175,000 workers in economic zones are out of jobs for many weeks now, with some of them receiving zero pay under the ongoing lockdown, prompting industry groups to ask that the quarantine be lifted as scheduled on April 30.

A survey obtained by the BusinessMirror showed that over 40 percent of locators in economic zones shut down their plants for the duration of the enhanced community quarantine (ECQ) in Luzon. On the other hand, those operating under the ECQ are subsisting on arrangements like work from home, skeleton force or a modification of the two.

The poll, conducted by the Philippine Economic Zone Authority (Peza) between March 26 and April 13, gathered the responses of 1,749 firms nationwide.

Together, they employ about 1.14 million workers, nearly a fifth of the 6-million total labor force in all economic zones. Locators operating under the lockdown maintain roughly 85 percent, or 966,333, of the workers; as such, pay was never an issue for their staff.

However, the remaining 15 percent are working for firms that called off operations for the whole of the quarantine, leaving 175,249 individuals jobless for more than a month now.

The Peza survey reported that majority of the nonoperational firms are paying their workers in full in spite of the suspension. Even so, at least 223 locators that stopped production implemented a no-work, no-pay policy.

Further, the poll indicated that a lot of economic zone firms are suffering from logistical issues under the ECQ, ranging from the unavailability of workers—blamed on the public transport ban—to the flow of goods disrupted by the checkpoints in place.

Fearing that extending the lockdown will also prolong the agony of the jobless, industry groups recommended that the ECQ be lifted as scheduled on April 30 to allow regular work to resume. They argued that the ECQ’s termination should be coupled with the rollout of mass testing and enforcement of health measures to sustain efforts against the coronavirus pandemic.

Semiconductor firms, producers of the country’s largest export item, expect their labor force to return to half the normal level if the lockdown is lifted or its protocols modified.

Skeleton force

Danilo C. Lachica, president of the Semiconductor and Electronics Industries in the Philippines Foundation Inc., explained that most of his group’s members are operating on skeleton force of around 30 percent of normal level. At such a low capacity, they have been accumulating order backlogs that can be resolved only if the quarantine is lifted or modified.

“About 80 percent of electronics companies are operating with [skeleton] work force averaging 30 percent of normal level,” Lachica told the BusinessMirror.

“We hope to see an increase to 50 percent, then higher if ECQ is modified,” he said. “There are order backlogs which can be addressed when we can increase staffing and [with] uninterrupted supply of materials.”

Last year, exports of electronic parts improved by over 4 percent to $40.02 billion, from $38.32 billion in 2018, according to data from the Philippine Statistics Authority.

Riding high from the growth they achieved in 2019, semiconductor makers initially targeted to raise their export receipts by 5 percent this year. However, the pandemic and its consequential lockdown virtually ended any chances of growth, forcing Lachica and his group to downgrade their forecast to flat or, worse, negative.

The sentiment to lift the ECQ as scheduled is shared even by foreign investors, as they said “it is becoming increasingly difficult” to wade through the restricted movement of people and the disrupted transport of goods—repercussions of protocols in place.

American Chamber of Commerce of the Philippines Executive Director Ebb Hinchliffe said that his group is in support of lifting the lockdown to allow manufacturing and construction work to resume. However, the public and private sectors should not let their guard down, he warned, and precautionary measures must therefore be imposed in the ECQ aftermath.

“We support a partial lifting of the lockdown in May to allow all manufacturers and construction [to] reopen under very strict test results and health precautions,” Hinchliffe said.

As of Sunday, there are 6,259 confirmed cases of the coronavirus disease in the Philippines. The government recorded 572 recoveries and 409 deaths from the respiratory illness that was first detected in Wuhan, China.