MANILA, Philippines—The impact of labor scarring inflicted by the COVID-19 pandemic was heavier on youth and female workers not only in the Philippines but across Asean-5, the Asian Development Bank (ADB) said on Thursday (Dec. 16).
The ADB’s Tokyo-based think tank ADB Institute (ADBI), in a separate report also on Thursday, nonetheless noted that the Philippine government moved to aid Filipinas badly hit by the dark times wrought by COVID-19.
“The Philippines has facilitated access to loans for women to grow their entrepreneurships via an online application process and exemption of collateral for women-owned entrepreneurships, among others,” said ADB in a policy brief titled “Women’s Economic Empowerment in Asia.”
“The Philippine government also has provided financial literacy programs,” the ADBI said.
The ADB, however, said that in the Philippines, Indonesia, Malaysia, Thailand and Vietnam, the pandemic had a “devastating impact on labor markets”. “This has been a crisis like no other,” it said.
In the case of the Philippines, the Manila-based multilateral lender earlier noted that its host-country suffered from the biggest jump — 5.2 percentage points (ppts) — in unemployment rate among its member-countries.
In 2020, the Philippines’ jobless rate climbed to a 15-year high of 10.3 percent or 4.5 million jobless Filipinos amid the then longest and most stringent COVID-19 lockdown in the region. It was a reversal of the 14-year low 5.1-percent unemployment rate posted in 2019, before the pandemic.
But more than the headline numbers, the ADB said in a report that vulnerable workers, like younger laborers and women, suffered more across the region. The report was titled “COVID-19 and Labor Markets in Southeast Asia: Impacts on Indonesia, Malaysia, the Philippines, Thailand, and Vietnam”.
“Young workers, who represent only 10–15 percent of the workforce in Indonesia, the Philippines, Thailand, and Vietnam, accounted for a disproportionate share (between 22 percent and 45 percent) of job losses at the height of the pandemic’s impacts on labor markets in these countries in 2020,” the ADB said.
“This is owing to their overrepresentation in sectors that were heavily hit like food and accommodation services, wholesale and retail trade, and ‘other services,’ and also because they were more likely to lose their jobs than adult workers in these same sectors,” ADB explained.
“The significant job losses experienced by youth were accompanied by other pandemic-induced difficulties such as disruptions to education and skills development, and delays in school-to-work transitions,” ADB said.
“The compound effect of these impacts can have significant long-term implications for the career and earning prospects of these youth,” ADB warned.
The Philippines, for instance, was among the last few countries in the world to resume face-to-face classes, which many feared had led to greater learning poverty among school children, the labor force of the future.
On female workers, ADB said that in all of the Asean-5 countries “and across virtually all age cohorts, women were more likely to exit the labor force following job loss, while men were more likely to become unemployed.”
“This is partly due to a larger share of the care burden falling on women,” ADB said.
“Although many female workers reentered the labor market in the second half of 2020, labor reallocation patterns pointed to an ‘added worker effect,’ or ‘distress employment’ whereby additional (female) family workers join the labor force to compensate for lost household income,” ADB added.
As a result, female workers across the region mostly reentered the labor force through “lower quality” jobs, such that the ADB said “the pandemic could have long-term negative impacts on the working lives of women.”
At least six million overseas Filipino workers (OFWs) and the rest of migrant workers coming from the region “were also heavily hit by the pandemic and its associated restrictions on travel and mobility,” the ADB said.
“Migrant workers are often on fixed term or temporary contracts and therefore suffer greater job insecurity. Aggravating their precarious conditions was the lack of clarity on whether they could access health and welfare systems in their host countries.”
“Despite unprecedented government responses, COVID-19 has exposed significant social protection gaps associated with high and persistent informality across the region,” said Ramesh Subramaniam, ADB director general for Southeast Asia, in a statement.
“It also has provided an opportunity for countries to address these gaps and expand coverage to new beneficiaries and excluded groups,” the statement said.
“As recovery takes hold, the focus of fiscal policy can shift more strongly from relief to stimulus, and from stimulus to structural investments that will promote sustained and inclusive growth,” it said.
“The pandemic and the risk of slower economic growth and increased inequalities have underscored the need for fiscal policy to go beyond its countercyclical role through increased investments in social protection and its infrastructure,” said another ADB official, Ayako Inagaki, director of human and social development for Southeast Asia.
“Countries should boost investments in human capital and mobilize domestic resources to build inclusive, sustainable social protection programs and increase social insurance contributions,” Inagaki said.