Bernardo M. Villegas
Articles  >> more topics
OFWs To The Rescue Again (Part 1)

             Among the major reasons why I think Philippine GDP can still average at least 6% for whole of 2023 is my expectation that OFW remittances for the whole of 2023 will be at least $40 billion, growing at close to 5% year on year in the last four months of the year.  From previous data, while OFW remittances slowed down in the first quarter of the year, growing only 3% year on year the pace accelerates during the second half of the year.  The reasons are easy to find.  First, a bulk of the remittances sent by OFWs are meant to assure that their children are able to pay for education-related expenses, whether for tuition or for other miscellaneous schooling expenses, especially at the tertiary level.  These expenses usually are lumped together towards the end of July or the whole month of August when classes at all levels start under the new academic calendar.  Also, starting September when the whole country already begins to feel the Christmas mood, OFWs already open up their wallets to help their loved ones prepare for the Christmas holidays.  Last September 1, I already heard Jose Mari Chan sing his Christmas carol on several channels. These remittances will be almost instantly consumed by the close to 25 million young people in the Philippines who, according to the Department of Education, enrolled in schools at all levels over the last two to three weeks.

            Although I have already written a great deal about OFWs in a six-part series in a business daily very recently, I have been prompted to  write again on this very important topic as a eulogy to the late Migrant Workers Secretary Susan Ople who passed away from cancer last August 22, 2023.  If there was an appointment that was richly deserved, it was that of the very competent and caring “Toots” Ople who dedicated her professional life to workers, especially OFWs, following the example of her late father, the late senator and labor Minister, Blas Ople, with whom I had the honor to work in drafting the 1987 Constitution.   Toots was no newcomer to the field of promoting the welfare of OFWs.  Almost twenty years ago in 2004, she founded the Blas P. Ople Policy Center and Training Institute in honor of her father. Through this Institute, she helped promote the welfare of hundreds of OFWs in distress. 

            I am sure that my late brother, Jose Malvar Villegas, Founder of Lapiang Manggawa, would have joined me in this eulogy for Susan Ople, who was a close collaborator of his.  As reported in another daily by Jacob Lazaro, a good number of labor groups have paid tribute to the late DMW Secretary.  For the Federation of Free Workers, “her passion for service for migrant worker stems from her proven dedication to the plight of Filipino workers. Her belief in social dialogue has give the government better policy options.” Before she joined the Government of President BBM, she exemplified the very important service that private citizens and civil society can contribute to enlightened policy making of the Government.  The Nakaisa labor coalition acknowledged her “unwavering dedication to migrant workers,” while Migrante International acknowledged her willingness to dialogue with other labor groups, even with those who were critical of her stand on certain issues.

            One of her closest friends and collaborators in promoting the welfare of OFWs was Dr. Veronica Ramirez, who occupied for many years the BPI Professorial Chair on OFWs at the University of Asia and the Pacific.  I am sure Toots would be happy for me to share with my readers the most recent data-filled report that Dr. Ramirez wrote to enlighten both government and private sector officials on the current state of OFWs under the BBM Administration.  In a paper entitled OFWs:  Their Un/Quantiable Contribution to Philippine Economy and Human Development, Dr. Ramirez compared the remittances inflows from overseas workers of the top four countries.  In 2022, India had the highest figure at $111 billion, followed by Mexico at $61 billion, China at $51 billion and the Philippines at $38 billion.  In 2015 the latest year with data, 2.2 million households in the Philippines had OFW members, among whom 11.5% are headed by a high school graduate, 7.4% by an elementary school graduate, and 4.4% did not complete elementary school.  The number of OFWs increased by 3% or 54 thousand overseas workers from 2020 to 2021.  At least 7% of Filipino households have an overseas Filipino worker who help sustain the family.  In 2021, more women (60.2%) were reported to be working overseas than men (39.8%).  According to a SWS survey, the top countries of choice of OFWs for employment are Canada (16%), Saudi Arabia (12%), Kuwait (9%), United Arab Emirates (9%), Japan (7%), Qatar (6 %) and the United States (6%). According to a SWS survey in 2022, 75 % of OFWs send money back home while only 3% never do.

            As regards savings and consumption, OFW households using their remittances to save in the fourth quarter of 2022 increased to 35.5% from the previous quarter’s 32.7%.  The purchases of appliances and other consumer durables slipped to 18.7% from 19.2 % in the previous quarter.  The percentage of households that used remittances to acquire houses declined  from 11.8% to 10.4% and those purchasing cars from 9.4% to 6.4%.

            Dr. Ramirez also gave some important insights into the poverty eradication impact of the phenomenon of OFWs.  According to a report of the International Labor Office (ILO), OFWs enable their respective families to climb up the income ladder, especially from dire poverty, in a relatively short period.  There is an average improvement of about 6 percentile points in income distribution of households in about a one-year period.  Self-rated food poverty is 20% among OFW families compared to 35% among other families.  Hunger among OFW families is 6.0% vs. 11.2 % among others.  It is important to note, however, that the poor households who were most successful in crossing over from poverty were those with migrants possessing higher education, underscoring once more the importance of human capital investment (not necessarily a college education) as a means to help lift the poor from their condition.  From my own personal experience working with different educational institutions at the tertiary level, those OFWs with technical skills acquired from TESDA-type schools get higher salaries abroad than those with college diplomas. 

            Since the end of integral human development goes beyond material or economic welfare, Dr. Ramirez also reports on the spiritual benefits to the host countries of the OFW phenomenon.  OFWs are in more than 200 geographical destinations.   For this reason, as far as their Christian faith is concerned, OFWs have been considered by the Catholic Bishops of the Philippines as modern apostles of evangelization.  To be continued.