Temporary or undocumented overseas Filipino workers (OFW) would bear the brunt of the global economic crisis, a global labor group said Wednesday.

In a report, the International Labor Organization (ILO) said migrant workers in Asia would be faced with much lower demand, particularly in sectors of construction, finance, and trade-related industries such as export manufacturing and shipping.

It noted that OFWs—especially those who are undocumented or under temporary employment contracts—are now in the weakest bargaining positions to retain their jobs because of the global slowdown, which has resulted in massive layoffs.

"Subcontract, casual, temporary and overseas migrant workers are among the most vulnerable to job cuts, and job losses can be especially harmful to these groups, as many non-regular workers do not qualify for the severance pay or benefits to which their regular counterparts are entitled," the report said.

The ILO said the country has some 5.1 million Filipinos working on temporary contracts abroad, with 2.18 million or 43 percent based in the Gulf States.

ILO said unemployment in Asia is seen to increase by 7.2 million between 2008 and 2009 to a rate of 5.1 percent, with vulnerable employment rising by 21 million.

In a worst-case scenario, the number of unemployed in the region could surge by 23 million to a rate of 5.9 percent.

Remittances

According to the Overseas Workers Welfare Administration (OWWA), 5,036 OFWs in ten host destinations have been displaced as of January 28, 2009 due to the global economic crisis.

With migrant workers' jobs at risk, so are remittances, which contribute to around 10 percent of the country's gross domestic product (GDP).

In Austria, for instance, OFW remittances are seen to drop by 2 to 3 percent in the next five months. 

ILO said remittance flows to developing economies in Asia began to slow down in the third quarter of 2008, with an overall decline in remittances to these economies expected in 2009.

For her part, Ursula Schaefer-Preuss, Vice President for Knowledge Management and Sustainable Development of the Asian Development Bank said growth of OFW remittances is expected to decline to as low as 6 percent to 9 percent in 2009, compared to 10 to 14 percent last year.

"Remittances from overseas Filipino workers comprise a major part of budgets in countries like Tajikistan, the Philippines, and Nepal. The World Bank projects a sharp slowing of remittance flows," Schaefer-Preuss said at the high-level forum on Responding to the Economic Crisis in Asia and the Pacific at Hotel InterContinental in Makati City.

The Bangko Sentral ng Pilipinas has reported $16.4 billion in remittances for 2008, up 13.7 percent from the previous year even with the global economic downturn.

Families affected

Aside from their reduced contribution to the economy, OFWs who are prematurely terminated face disastrous results back home.

For instance, the ILO said children may be pulled from school as education becomes less affordable, and may be forced to support their families through child labor.

During the Asian financial crisis, ILO said a drop in enrolment rates and a rise in child labor were seen among 10-14 year-olds in the Philippines.

"While income alone is not the sole determinant of the decision to send a child to school or work, its influence cannot be understated," the report said.

According to the World Bank, the Philippines is among the "highly exposed" nations to rising poverty as a result of the economic crisis, with 20 percent of households below the $1.25 poverty line in 2005.

Government responses

With this scenario, the government has offered various options to OFWs displaced by the global economic crisis.

For one, the Philippine Overseas Employment Administration (POEA) has established help desks  last month to match the skills of retrenched OFWs with available jobs both in the country and abroad. The POEA has also extended legal assistance to OFWs seeking refund for air fare, and placement fees, among others.

President Arroyo has also ordered that P250 million be allotted by the OWWA to provide livelihood support to OFWs laid off as a result of the economic crisis. However, an investigation is being pushed in the House of Representatives, following the alleged duping incident of OFWs in Malacanang last year.

Labor Secretary Marianito Roque, for his part, announced Wednesday that the President has ordered 1.5 percent of the country's operating budget to create 180,000 emergency jobs.

Speaking before ILO officials and other leaders of employers' organizations, Roque stressed that Filipinos should not doubt the government's capacity to overcome "the global financial crisis challenge."

"There are many daunting challenges caused by the global financial crisis, but the crisis must not deter us to do more," Roque said.

“We remain committed to pursue decent work for all Filipinos," he added.