After Taiwan layoffs, Korea might decline hiring OFWs

After Taiwan layoffs, Korea might decline hiring OFWs
MARK JOSEPH H. UBALDE, GMANews.TV
12/04/2008 | 06:48 PM

MANILA, Philippines - Following the massive lay-offs of workers in Taiwan, a recruitment consultant warned that a similar fate might befall Filipinos in South Korea as Asian economies begin feeling the brunt of the global financial crisis.

Recruitment consultant Emmanuel Geslani told GMANews.TV on Thursday that South Korea’s export industry is prone to the effects of the US-led economic meltdown that has caused the firing of more than 1,250 overseas Filipino workers in Taiwan.

Although South Korea continues to have a strong economy, Geslani said only local workers are protected from lay-offs. He clarified, though, that the effects have yet to be fully felt in Korea.

“The lay-offs have started but they are still relatively small," Geslani told GMANews.TV in an interview.

He said OFW deployment to South Korea went down by 40 percent last year compared to 2006. He predicted that small- and medium-scale businesses mostly involved in electronics, heavy equipment, automobiles, and ship makers would be affected.

As of May 2008, a total of 20,476 Filipino workers have been deployed to South Korea.

Jeniffer Manalili, Philippine Overseas Employment Administration chief, told GMANews.TV that they are still monitoring the situation of other countries in Asia where there are large OFWs populations.

Manalili said that it is still early to estimate how many Filipinos might lose their jobs overseas.

“It will depend on how the economic crisis will impact the countries of destination and origin," she said. “We are hoping that we will be able to maintain or sustain the number of OFWs."

Manalili said the real face of the crisis would be seen only next year, when economic experts predict that the financial meltdown would peak.

Economists like Emmanuel Leyco, who had worked in a credit rating agency, predicted that the US recession would create a domino effect all over the globe and cause millions of OFWs to lose their jobs.

"In a global recession, immigrants are the first to go," Leyco said in an interview.

Business leaders say the hardest hit in the US-led global financial meltdown are those in the real estate and export industries.


Labor agreement

But aside from the economic crisis, Geslani believes the “short" extension of the labor agreement between the Philippines and South Korea could add up to the problem.

The deal has been extended for only three months, after it expired in October according to the POEA.

With the extension, Korea will continue to follow the Employment Permit System (EPS), a government-to-government recruitment system implemented by both countries since 2004.

POEA head Jennifer Manalili explained to GMANews.TV that they aim to have a new labor deal with the Korean government signed before the end of January, one month before the extension expires in February 2009.

The administrator said they were “renegotiating" the agreement to iron out several provisions, particularly the facilitation of the Korean Language test requirement for Filipino workers.

The EPS was supposed to correct the exorbitant mobilization costs charged by recruitment companies and their brokers in South Korea.

With the abolition of the trainee scheme in 2007, Korean employers can only get foreign workers through the system with the POEA as the only government agency authorized to implement the scheme in the Philippines.

South Korea implements the EPS with Vietnam, Thailand, Indonesia, Sri Lanka, Mongolia, Cambodia, Uzbekistan, and Pakistan.

Reports, however, said that among problems encountered with EPS are unfair labor practices, lack of welfare and protection, payroll deductions for food and lodging, and high rate of runaways from employers.

Manalili said the new labor agreement would benefit more OFWs in South Korea, which still needs 10,000 Filipino workers to fill up its labor demands. - GMANews.TV