MANILA – A survey done by the World Bank, the National Economic and Development Authority, and the Department of Finance shows 48 percent of companies in the Philippines have reduced the number of their employees amid the Covid-19 pandemic.
The survey was among 74,031 firms from July 7 to 14 to assess the impact of the health crisis to businesses.
“Job loss is most significant in the education, food services, construction sectors, with greater than 60 percent of firms in these sectors having laid off their employees,” the survey said.
Laying off workers is lesser in financial services and health sectors, with two out of five firms in these sectors reported they have reduced the number of their workers.
On the other hand, only 1 percent of the firms hired new employees.
Of the total surveyed companies, 40 percent said they temporarily suspended their operations –20 percent by government mandate and 20 percent voluntarily.
The survey added about 15 percent reported to have closed their businesses permanently.
“Even though community quarantine measures were relaxed to some extent during the time of survey, firms still reported a high degree of uncertainty. Uncertainty is an important additional channel affecting firms during the pandemic, and as the economy re-opens, this could result in a lower desire for risk-taking and additional investment,” the survey said.
It added about 45 percent of companies are uncertain when they can resume their operations.
Among operating firms, 20 percent said they expect their businesses to close between one to three months, 13 percent expect to shut down their operations between three to six months, and 12 percent think to stop operation after six months.
The level of uncertainty in terms of employment activities and revenues between July and September this year are also high at 33 percent and 28 percent, respectively.
Support from government
According to the survey, only one out of five firms have received some support from the national and local government such as cash transfers to their employees through the Pantawid Pamilyang Pilipino Program (4Ps) and social amelioration program, loan payment deferral, wage subsidies, regulatory relief, and deferral of rent, mortgage, and utilities.
Among the reasons for not receiving support from the government include difficulty in applying for support, not being aware of the programs, not receiving the support after application, and not eligible for the support program.
“This suggests the need for increased awareness and clarity on the guidelines and requirements of current programs as well as the timely implementation of the programs. This is particularly needed for the new government loan programs offering subsidized interest rates that are in high demand,” the survey added. (PNA)
