Manila, Philippines – Overseas Filipino workers (OFWs) coming home to escape the Middle East conflict could exacerbate joblessness if they end up unemployed, an official of the Philippine Statistics Authority (PSA) said on Friday, March 13.
The impact of the Middle East crisis on the labor market could be worse than what was seen during the onset of the Russia-Ukraine war when the domestic unemployment rate rose to 6 percent in June 2022, breaching the 4 percent to 5 percent government target, the PSA added.
Already, the latest jobless rate – computed as the ratio of those without work to the labor force aged 15 and older – was nearing the June 2022 level at 5.8 percent, a three-and-a-half year peak, in January, according to data released on Friday.
“Once we had that Russia-Ukraine war kaagad-agad tumaas agad yung oil and even starch kasi Ukraine is also a source of starch. So dito sa employment rate hindi masyadong significant yung effect but I think yung tension sa Middle East will have a more significant effect kasi ang daming OFWs sa Middle East and some of them were already repatriated,” Divina Gracia del Prado, Deputy National Statistician, told a press briefing.
[TRANSLATION: Once we had that Russia-Ukraine war, oil prices immediately rose and even starch because Ukraine is also a source of starch. Its effect on the employment rate at the time was insignificant, but I think the tensions in the Middle East will have a more significant effect because of the population of OFWs there and some of them were already repatriated.]
Official estimates put the OFW population in the Arab nations somewhere between two million and 2.5 million, sending dollars back home equivalent to 18 percent of total remittances, an economic backbone.
Repatriation in batches began last week as Iran struck US facilities across Gulf States in retaliation to the US-Israel military campaign against Tehran.
The January labor data pointed to 2.96 million unemployed Filipinos.
“So if they [repatriated OFWs] become part of the labor force and they are unemployed, then they will increase the total number of unemployed and of course, the unemployment rate,” Del Prado said, adding that the impact will likely be reflected in March data.
“Even domestically we expect siguro bababa din yung employed natin [falling employment rates] because when prices of oil spikes, some business di na nagha-hire [pause hiring] or some of them lay off so it might affect our labor market. Yung spike in prices of oil [The spikes in oil prices],” she added.
