Tuesday, September 21, 2021
HomeOpinionThe Export AdvocateA myth on OFW remittances

A myth on OFW remittances

Whenever Bangko Sentral ng Pilipinas (BSP) announced hefty increases in OFW remittances, its spokesmen sounded so upbeat, at times, even euphoric.

The figures have indeed been impressive and are estimated to break the US$24-billion mark this year. Multiply that by P41 and that’s a big chunk of cash going directly to the migrant workers’ families. Warm bodies have become our biggest exports, with 1.47 million Pinoys and Pinays deployed the other year alone.

Last year, a BSP official went on to claim that more highly paid professionals were sending the dollars, his conclusions premised on the fact that the bulk of the remittances were coursed through banks and remittance companies based in New York and Canada.

The BSP was way off the mark in arriving at that conclusion, avers a veteran OFW and now the leader of the OFW deployment industry in the Philippines, Lito Soriano.

In a recent forum on what makes a sound exchange rate policy, Soriano, in a presentation he titled “Reality Check on the OFW Situation”, came out with facts and figures that make one conclude that the BSP conclusion is nothing but a myth.

Our top labor exports are domestic helpers and other home service providers like gardeners and family drivers, over 150,000 the other year plus more than 120,000 factory workers. In comparison, about 41,000 professionals were sent abroad that year.

In the compensation ladder, what we are sending abroad are people who are at the bottom rung. And when the peso appreciates against the dollar as it has been doing since 2001, the send-home pay got less and less. Every OFW was hit by the strong peso exchange rate policy. And with 10 million of them abroad, victims of the ever-stronger peso are about half of all Filipino families. The lowest-paid maids and factory workers are the hardest hit.

As Soriano correctly pointed out, the strong peso has equally bled the OFWs as well as the business process outsourcing (BPOs) and the exporters.

It was not for lack of vacancies for higher-paying jobs that this trend came about. Unfilled vacancies for highly skilled workers is over a hundred thousand every year but could not be filled up because of lack of experience.

Second most in demand are experienced professionals like engineers and nurses but even present-day professionals have little job experiences because there are few available jobs in the country; most domestic industries are dead. This segment of the economy was once the richest hunting ground for highly paid and decent jobs abroad. This source of new recruits is gone.

The farm sector where skilled farm workers and agri professionals could train is also shrinking.

Available local jobs are what Soriano call the “endo-endo” (end of contract) service jobs. The term is the street jargon for casual jobs that end every six months, a job situation now being passionately protested by labor federations: the casualization of Philippine labor.

Some sectors and government agencies may be euphoric over the fact that the country is now awash with OFW dollars. But this deceives policy and decision makers into believing that the sweat and tears of the OFWs could serve as a long-term substitute to sustainable progress and prosperity for the many. We have yet to come up with more long-term, sustainable solutions with the least social costs.

For exporters and OFWs badly hit by a strong peso, an urgent intervention is the implementation of a monetary policy with bias towards a competitive currency that can bring about economic development and progress.


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