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American Unemployment and the Effects to Philippines

As we all here on the news and from friends and relatives, unemployment has reached one of the highest levels for many years. I was a victim at the beginning of the financial crisis back in 2007. There was so much new housing and as their prices increased, it raised the levels of the resale housing market. What caused this was investors were buying up everything at the low pre-construction prices and we getting 125% zero interest mortgage loans. Then the prices reached such a high level nobody could afford to buy. When the selling stopped, all the investors walked away with their free 25% from the mortgages and let the banks foreclose.

I know, as reading this, you might wonder how this affected all of us. Well, when investors and perspective homeowners stopped buying, the housing developers stopped building. When they stopped building, the employees were not needed. Then the subcontractors that did the construct, the plumbing, the electrical and the rest of the trades had no work. So the contracting companies had to lay off their workers. Also at that time, the suppliers were not selling to the contractors, so they needed to lower staff or at the worse close up their businesses. With all these workers being laid off, they have less money to spend at the malls and markets to these businesses had to lower staff too.

Now you might ask, what has this have to do with the Philippines. Many Filipinos work abroad. The term here is OFW’s or Overseas Foreign Workers. Many of these Filipino are contract workers with only a work visa. These workers send money home to help support their families in the Philippines. When employment was high and employers could not find Americans to fill the positions, the Government allows hiring through the work visa programs.  Eventually, if the layoffs and unemployment grows there will be more Americans available to fill these positions, many contracts will not be renewed and these OFW’s can lose their jobs and status to stay. If this happens, these Filipinos will return to the Philippines and the support for their families will be gone.

There is another problem how this economy crisis can affect Americans and the Philippines. As we get older, companies hiring look for the younger generations to fill the positions and less to the older applicants. There is a term “un-hirable.” This sometimes means you are too old to be desirable to be hired. If you’re in your 50’s or early 60’s companies will look at longevity. Why hire someone who is not going to stay and grow with a company in the long term. Many of these people, who know about the Philippines and the lower cost of living, will start thinking of moving here. This is not a bad thing by any means except many people who move here do not realize how live might be better and how it can be worse. In previous articles I have written about many of the differences living here. I hope they do not just pack up without visiting, seeing how life is living here as a resident and not relaxing in a hotel.

With this site and many others online, I hope people considering a move here will take the time to read and research to better understand.

13 Responses to “American Unemployment and the Effects to Philippines”

  1. Rich says:

    Ya I hear its tough out there right now. Luckily for my family the business were in can’t do enuf business fast enuf.

    • Bruce says:

      It is tough everywhere, especially here if your not a rich enterprising foreigner with a big bankroll. Maybe I can make some money designing and getting homes built. (wink)

      • Per says:

        Yes. Most people don’t know that Philippinos abroad, working in construction, as nurses, domestic help, etc sending home money to their families is a VERY important part of the countries economy. It is so much so, that it actually officially registers as part of the GNP! I have heard numbers from as much as staggering 10% to even up to unimaginable 20% of Ph economy is based on Pinays/Pinoys working abroad and sending home money!
        So, the unemployment in USA and Europe severely affects the Ph economy, even more than it affects the USA and European economy!

  2. Tom says:

    Yes unfortunately you will always have some that leap before they look. Many of these return home broke and disgruntled. Some actually manage to hang on and make it work.

    For the majority it is better to do your homework and have a better idea what to expect. There is no substitute for a trip or even two to scout the reality of the situation. 😎

  3. Rich says:

    Was thinking more about this today, this finacial climate is probably putting a dent in peoples retirement funds. I would imagine they are not seeing the same returns as they would need. Makes you think that one would need a buffer to get over these periods. Hmmmmmmm, I smell a article comming 🙂

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