3 of 5 workers in Luzon will likely lose wages, earnings due to Luzon lockdown

March 18, 2020

by IBON Foundation

Research group IBON said that 14.4 million non-regular workers and informal earners, or three-out-of five employed persons in Luzon, are most at risk of lost wages and earnings due to the Luzon-wide lockdown. The group said that the government should take necessary measures to contain the spread of COVID-19, but these should be particularly sensitive to the plight of low income workers and their families.

The Duterte administration recently declared an enhanced community quarantine or lockdown of Luzon island. These guidelines include only allowing the operation of private establishments providing basic necessities and production related to food and medicines. Exceptions though are business process outsource (BPO) firms and export-oriented industries. All operating establishments are also required to adopt a strict skeletal workforce. Mass public transport, class and school activities, and work in the Executive branch has been suspended.

IBON said however that these strict home-quarantine policies are affecting the livelihoods of millions of low income Filipinos, particularly those without regular work. The group said that many low income Filipinos in poor-quality jobs or precarious work – or work that is insecure, low-paying, and lack benefits – face lost wages and earnings during the lockdown. They are made even more vulnerable due to the lack of much-needed benefits such as medical and social security during the COVID-19 pandemic. Poor quality work includes, for instance, temporary or contractual workers, salespersons, street vendors and drivers of suspended public transport vehicles.

IBON estimates, based on latest available 2018 data, show that some three-out-of-five (61.6%) of total employed persons in Luzon are in this kind of poor quality work. This covers 14.4 million or a majority of the employed in Luzon consisting of: non-regular in private establishments and government (6 million), and informals (8.5 million) consisting of private household workers, worked with pay in own family-operated farm or business, own account workers, and unpaid family workers.

Meanwhile, IBON estimated some three-out-of-five (60.5%) of total employed persons in the National Capital Region (NCR) in poor quality work. They account for one-out-of-five (21.7%) of the total precarious work in the entire island of Luzon. Majority of employed persons in the NCR, or 3.1 million are in poor quality work consisting of non-regular in private establishments and government (1.5 million), and informals (1.7 million).

There are already reports of workers faced with reduced work hours or forced leave due to limited operations of business establishments, said the group. Others, like small-business owners and their employees have had significant loss of earnings due to the drop in customer traffic. Workers have also had difficulties traveling to and from work due to the suspension of mass public transport and checkpoints.

IBON noted that of the Php27.1 billion spending plan for COVID-19 rolled out by the government, only Php2 billion has been allotted as wage subsidy or financial support for displaced workers and Php1.2 billion for social security unemployment benefits. Non-regular workers may not be able to avail of this cash assistance because of their irregular or informal status. Meanwhile, other assistance provided through the spending plan is in the form of skills training or loans that will not provide immediate relief or that will put job and income insecure Filipinos into debt. IBON said that while addressing this serious public health emergency, government should also ensure that non-regular workers and their families are not driven into further poverty and hardship. Among the steps the Duterte administration can take is to declare a freeze on workers’ employment status as well as ensure that they continue to receive full pay. Government should also provide decent and adequate direct cash assistance to informal sector earners.