Prolonged Middle East war threatens jobs for up to 340K OFWs, warns DepDev

Around 200,000 to 340,000 Filipinos abroad could lose their jobs if the war between the United States, Israel and Iran continues, said Secretary Arsenio Balisacan of the Department of Economy, Planning and Development (DepDev) on Wednesday.

The US and Israel launched joint airstrikes against Iran on February 27, prompting Iran to retaliate by firing missiles at other oil-rich Middle East countries where the Philippines sources 98% of its crude oil supply.

Since then, Iran has also closed the Strait of Hormuz, a major passageway for oil supply worldwide.

“Because of the importance of oil in the economy, particularly on transport, logistics you would expect unemployment to rise. We are looking at compared to the baseline of 4.6 percent unemployment rate in 2026…that could go to five 5.3% which would mean an additional of about 200,000 to almost 340,000 workers getting unemployed,” Balisacan said during a briefing before the House Ways and Means panel. 

Balisacan said that as it is, there are already Overseas Filipino Workers (OFWs) who already lost their jobs amid the conflict due to the deployment ban and repatriation.

“That [figures I mentioned] is a situation where you have a 5% repatriation. In the event that you have a higher rate of repatriation, that increase in the number of employed people will be even higher. These estimates have taken into account the impact of lower remittances, high transport cost, high oil prices...and the reduced domestic demand arising from lower household incomes and inflation,” he explained.

Since 75% of the Philippine economy is dependent on domestic demand, Balisacan also warned that the next impact would be the increase in the number of poor Filipinos.

“The incidence of poverty where the baseline is 12% or roughly about 14 million people deemed poor…those numbers will rise to 12.14% to 12.5% or an increase of anywhere from 150,000 Filipinos to 600,000 Filipinos entering the ranks of the poor,” he said.

“That [increased povery] has implications on our assistance programs later,” Balisacan added.

More poor

According to Joseph Morong’s “24 Oras” report, the number of Filipinos entering the ranks of the poor could reach 650,000 if the prices of petroleum products further increase.

This prompted President Ferdinand Marcos to form the Unified Package for Livelihoods, Industry, Food, and Transport. 

According to the Department of Budget and Management (DBM), more than P200 billion has been set aside for various government programs to assist those affected by the crisis. 

The DBM also directed all government agencies to implement cost-saving measures.

“Time for us to be thinking of a high prices scenario staying with us for quite some time,” Balisacan said.

Energy Secretary Sharon Garin clarified that oil prices in the Philippines may have risen the fastest, but the country does not have the most expensive fuel.

“Actually, we are the highest in the percentage of increase, but we are not the highest in price. We're actually one of the, in the middle, in the price compared to the rest of the world. We are just the most vulnerable in terms of like what's happening now, yung response nya tayo yung pinakamataas na akyat,” Garin said. — With Mariel Celine Serquiña/LDF, GMA News