- About eight million Filipinos will go unemployed as the pandemic rages according to Maybank.
- The country’s unemployment rate could reach 18.5% this year, the highest in the ASEAN region.
- Maybank also warned that the IT-BPM sector may be seriously hit by the crisis.
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According to Malaysian financial giant Maybank, about eight million Filipinos will go unemployed as the pandemic rages and as the Philippine economy reels from the region’s most strict shutdown, poor disease control, and an influx of returning OFWs.
Maybank Kim Eng analysts Chua Hak Bin, Lee Ju Ye, and Linda Liu projected the Philippines’ unemployment rate to reach 18.5% this year, the highest in the ASEAN region, in a study titled “Labor Market: Retrenchments and Recovery,” published July 9.
Last April, the unemployment rate already reached a 15-year high of 17.7 percent, equivalent to 7.3 million unemployed Filipinos at the height of the enhanced community quarantine, which put to a halt 75 percent of the country’s economic activity.
Maybank said that across ASEAN, “jobs recovery will likely be slower in this pandemic crisis compared to the global financial crisis, during which unemployment rates took around four to six quarters to return to pre-crisis rates.”
“Indonesia and the Philippines will likely lag in the jobs recovery, as they face longer lockdowns and are still struggling to flatten the pandemic curve. Fiscal support has been relatively small” in these two countries, Maybank added.
Maybank cautioned the IT-BPM sector—the largest dollar-earning industry in the country—may be seriously hit by the crisis. According to the IT and Business Process Association of the Philippines, the sector employs about 1.2 million Filipinos or 3.6 percent of total jobs. “Work-from-home policies are not a viable long-term option due to concerns about data security, power outages, and poor internet connectivity,” Maybank explained.