The Duterte administration’s declaration of an enhanced community
quarantine over the whole of Luzon threatens to displace nearly 11 million
workers and informal sector earners, said research group IBON. The group said
that while government is correct to take all necessary measures to stop the
spread of the COVID-19 virus, it is failing to do this in a way that protects
the poorest and most vulnerable Filipinos.
The government declared an enhanced community quarantine,
colloquially called a lockdown, over the whole of Luzon for nearly a month
starting March 17, 2020 until April 13, 2020. In covering the eight regions of
Luzon, the lockdown effectively spans three-fourths (73%) of the economy
measured by gross domestic product (GDP) as of 2018. Luzon also covered 24.2
million or 57% of total employment as of 2019.
IBON estimated that the lockdown will potentially displace some 11
million workers and informal sector earners. This was computed using the latest
available 2018 labor force survey (LFS) data and approximating the impact of
the lockdown guidelines announced last night by Cabinet Secretary and
Inter-Agency Task Force (IATF) spokesperson Karlo Nograles.
Sec. Nograles said that only private establishments providing
basic necessities and production related to food and medicines will be allowed
to operate. Exceptions explicitly stated include business process outsourcing
(BPO) firms and export-oriented industries. All establishments still operating
will be required to adopt a strict skeletal workforce. Notably, mass public
transport will be suspended spanning buses, jeepneys, tricycles and trains to
restrict the movement of the population. Classes and school activities are
suspended at all levels. Most work in the Executive branch is also suspended.
IBON correspondingly estimated varied degrees of displacement from
the outright suspensions, not being covered by exceptions, a skeletal
workforce, and a drop in customer traffic. Given the structure of economic
activity, the biggest number of affected jobs are going to be in the following
sectors: 2.4 million construction jobs (assuming almost all affected); 2.4
million wholesale and retail trade jobs (50% affected); 1.5 million transport
and storage jobs (75%); 891,000 accommodation and food service jobs (75%); and
832,000 other service jobs (50%).
These are followed by: 731,000 information & communication and administrative & support service jobs (50% affected); 618,000 manufacturing jobs (25%); 395,000 agricultural jobs (assuming 10% affected from a skeletal workforce in agricultural establishments); 381,000 real estate and professional, scientific & technical jobs (assuming almost all affected); 360,000 education jobs (50%); 269,000 arts, entertainment and recreation jobs (assuming almost all affected); and conservatively 132,000 public sector jobs (10% affected assuming continued pay but a skeletal workforce).
The relatively least amount of potential displacements is in: 95,000 financial jobs (25% affected); 34,000 health and social work jobs (10%); 24,000 mining and quarrying jobs (25%); and 10,000 utility jobs (10%).
The group said that any disruptions in the livelihoods of
displaced workers and informal sector earners will have grave consequences.
There are approximately 14.3 million families in Luzon. IBON initially estimated
that 3.9 million of these families have a monthly income of around Php11,000 or
less, 2.2 million of between Php11,000-15,000, and 2.3 million of between
Php15,000-20,000. These 8.4 million families of around 32.5 million Filipinos
have very low incomes and little savings.
Poor and low-income families are the most at risk from even
short-term disruptions in earnings, said the group. Many among the 4.5 million
families in Luzon with monthly incomes between Php11,000-20,000 even risk being
pushed into poverty without expedient government support.
IBON said that the government needs to act quickly and decisively
to help the poorest and most vulnerable households. Among the most important
support the Duterte administration can give during this serious public health
emergency is to declare a freeze on workers’ employment status and ensuring that
they will continue to receive their full pay. Luzon establishments can afford
this considering, for instance, the Php1.9 trillion in profits they made in
2017, the group said.
Informal sector earners can also be supported with a direct cash
subsidy, said the group. The administration had previously given unconditional
cash transfers to the poorest 10 million families as a smokescreen for its
regressive tax reforms. The mechanism created for this can be used to give a
health emergency subsidy of Php1,500 per family for a total of just Php15
billion. This is about as much as the government is giving to support the
tourism industry in its COVID-19 response package.
Stopping the spread of the COVID-19 virus does not need to mean
the spread of poverty, said IBON. ###