Update on Effects of Oil Price Decrease on the Employment of OFWs
Department of Labor and Employment
8 March 2016
(Following the instruction of Labor and Employment Secretary Rosalinda Dimapilis-Baldoz to all Philippine Overseas Labor Offices to provide weekly updates on the effects of the oil price decline on OFWs, the Labor Communications Office, in cooperation with the International Labor Affairs Bureau, is providing below a summary of the POLO reports for the week.)
In Abu Dhabi, United Arab Emirates, the POLO reported a 1,321 percent increase in the number of job orders verified and processed, from 65 last week to 924 this week; an increase in contracts processed, from 211 last week to 322 this week; and an increase in OECs issued, from 561 last week to 996 this week. Fifty-five percent of the job orders verified and approved are in construction, followed by sales, 21 percent; and oil and gas, at 20 percent. Seventy-seven percent of the manpower demand is for semi-skilled, while 18 percent are for highly-skilled workers.
The high increase in job orders is due to the continuing demand for workers at the UAE’s Barakah nuclear power plant in Ruwais, which is expected to be completed by 2020. The increase in OECs is expected to further increase in the peak season of March, April, and May when OFWs go on vacation.
The POLO also reported three termination this week in the oil and gas sector. One was terminated due to redundancy, and the other two resigned for personal reasons.
From Taiwan, the Office of the Labor Representative reported that job orders processed for the last week of February increased to 149, from the 104 job orders processed in the previous week; employment contracts processed increased to 11, from nine in the previous week; and OECs issued decreased from 48 to 47 in the week in review.
It also reported that based on verification data from both Kaohsiung and Taichung, the weekly fluctuation in worker demand could not be categorically attributed to the oil price decrease.
It further reported that Cando Corporation, a Taiwanese company, has closed shop in February, affecting 43 OFWs who underwent the regular process of the Council of Labor Affairs. Of the 43 OFWs, five opted to be transferred, while 38 decided to return home. The Office of the Labor Representative successfully negotiated for the full separation pay, full coverage of return air fare, airport assistance, and job facilitation assistance for the returning workers. For the five workers who opted to be transferred, it also successfully negotiated for their full separation pay, free board and lodging during their job search, and full coverage of their return pay in case they fail to land new jobs.
From Korea, the POLO reported that GS Engineering, a Korean company with operations in Korea, Saudi Arabia, Kuwait, Bahrain, Oman, Singapore, and Vietnam has no plan of downsizing its workers. The company employs 40 OFWs in South Korea and yet an undetermined number of Filipino workers of its 1,900 employees abroad. It also reported that Hyundai Heavy Industries Co. Ltd. (HHI), Daewoo SME (DSME), and Samsung Heavy Industries (SHI) have incurred heavy operating losses in 2015 due to weak demand for offshore oil and gas facilities as well as more intense competition from rival shipyards in China. HHI will halt its operations in one of its shipyards, but nine Filipino engineers in the yard working for Chevron which has a contract with HHI said they will not be affected by the stoppage of the operation.
At the Daewoo and SHI shipyards in Geoje City, the contracts of 50 Filipino engineers were not renewed last February since some projects were put on hold, namely, Inpex Abadi FLNG (Samsung); British Petroleum Hopkins production platform (Samsung); Statoil Johann platform (DSME); Woodside Browse project (Samsung); ENI Coral (DSME); and Chevron TCO (DSME).
The next update will be Monday, 14 March 2016. For questions, please contact the Labor Communications Office at 527-3446.