Update on Effects of Oil Price Decrease on the Employment of OFWs
Department of Labor and Employment
7 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 the Eastern Region of Saudi Arabia, the POLO reported an increase in job orders, from 93 last week to 113 this week. However, there is a decrease in the number of contracts (manpower complement) processed, from 516 last week to 446 this week. There is a slight increase in OECs issued due to vacationing OFWs. There is no reported termination. Saudi Aramco workers still not affected by the oil price decline, but it has stopped/slowed down in implementing non-oil projects, affecting its sub-contractors.
The POLO in Jeddah reported that it has met with the HR management of the Saudi Bin Ladin Group (SBG) to discuss the reported “demobilization” and manpower reduction the company is currently undertaking and how this affects OFWs in the company.
As already reported, the POLO said there are 4,854 OFWs working for the SBG, detailed as follows: (a) Architecture, Building, and Construction Division (ABCD), 263; (b) ABCD-Main, 1,869; (c) Headquarters, 15; (d) Operations and Maintenance, 752; (e) Public Buildings and Airport Division, 1,270; (f) Rush Project Division, 654; (g) Tunnel, Dam, Reservoir Division, 31.
In addition, there were 2,845 OFWs deployed to SBG contractors during the period 2014-2015. Out of the total number of OFWs, 343 have left KSA on an exit-re-entry visa, but did not return; 2,148 who left on final exit with full benefits and entitlements; 8 who ran away or absconded, or a total of 5,344. The POLO also reported that out of an estimated 20,000 FOREIGN workers whose services were terminated by SBG, ONLY 634 were OFWs, or roughly 3 percent.
The current difficulties of the SBG arises from delay in government payments to its projects, but the POLO said the management has assured that as a matter of policy and practice, it does not repatriate its foreign workers without settling its financial obligations as well as paying workers’ end-of-service benefits. The management has also assured the POLO of its cooperation in ascertaining the individual names and positions, as well as on issues such as residence permits and exit visas, of OFWs who might be adversely affected in the coming months, including those OFWs transferred or assigned to its subcontractors.
In Dubai, UAE, the POLO reported that OFWs continue to find employment in the wellness, hospitality, and service (food) sector, but manpower demand in retail/sales and manufacturing continue to be slow.
The POLO is verifying a report of termination of OFWs by Sharaf DG, a popular chain of electronics retail store whose sales personnel are mostly Filipinos. It has obtained a list of 37 companies owned by the Emirate of Dubai and gathering the data as to the exact number of OFWs these companies employ. It reported that Dubai Drydocks employ close to 3,000 OFWs, mostly welders and fabricators.
The POLO in Bahrain reported no termination this week; an increase in job orders processed, from 38 in the previous to 41 this week; an increase in employment contracts processed, from 147 last week to 189 this week; and an increase in the number of OECs issued, from 146 in the previous week to 287 this week.
While the Macau economy is not affected by the slump in oil prices, its revenues from gaming—on which it depends much, including on tourism, textile, and garments—have been declining since 2014. The government has cut down on unnecessary expenses, but its budgets for livelihood, social welfare, and infrastructure investments are not affected. The POLO reported that it processed 36 contracts in January and 35 contracts in February. It also processed five job orders in January requiring 97 workers. There is no reported termination; employment situation remains stable.
From Taiwan, the Office of the Labor Representative reported that Powertech Technology Inc. (PTI), a world-leading provider of IC back-end services, will hire 78 OFWs to work as factory workers in its plant in Hsin-chu, Taiwan on 31 March through the Special Hiring Program for Taiwan/International Direct E-recruitment System (SHPT/I-DES). Three of its HR executives will conduct a screening/interview of 320 applicants at the Occupational Safety and Health Center in Quezon City.
In Brunei, the POLO reported that job orders verified increased from 41 last week to 48 this week, but the manpower complement decreased from 155 to 107. It said further the job orders were not in the oil and gas sector, but from trading and services. Individual contracts verified also increased, from 70 last week to 92 this week. Likewise, OECs issued increased from 207 to 240. There is no reported termination.
In Singapore, the Philippine Embassy reported that news accounts say Singapore is experiencing low job growth due to drop in demand and restrictive labor policies, but workers’ incomes are rising due to a tightening of the labor market and shortages in labor supply. Business associations continue to call for the easing of the rules against foreign workers, but Singapore government is unmoved.
The POLO in Australia (which has jurisdiction over New Zealand) reported only two job orders involving two positions were processed this week; nine contracts processed; and 24 OECs issued. There is no termination, and it reported that the same condition as of last week will prevail over the next three months, which means oil and gas projects will continue without significant change in manpower complement. Key players in the oil and gas sector have postponed implementation of new projects until oil prices have stabilized.
EUROPE AND THE AMERICAS
The POLO in Geneva, Switzerland, reported that OFWs remain unaffected by the oil price decline; but continues to monitor potential displacement from the ILO, UNDP, and other international organizations.
In London, UK, the POLO reported no OFW termination.
The next update will be Monday, 14 March 2016. For questions, please contact the Labor Communications Office at 527-3446.