Many OFWS are not exempt from experiencing economic meltdowns in their country of work. Countries and governments in the Middle East, Asia, and even the Americas have gone through several financial downturn in the past and these can happen like a vicious cycle.
There are several reasons why many OFWs are at risk of losing their jobs overseas. Here are the most common:
1. Companies lose big contracts and projects
For several reasons, even the biggest companies experience financial setbacks due to losing demands in the market. Technology also plays a big part in the job loss of many OFWs who work in subcontracting companies. When big clients acquire better technology (e.g. robotics, new machinery, etc.), the requirement for additional contractual labor decreases.
This is one reason why many OFWs either do not get their salaries on time or worsse, lose their jobs in the process. No project to do, no money to come in, OFWs lose their jobs.
2. Oil prices become less competitive
For OFWs in the Middle East, the falling prices of oil has affected their compensation and jobs as a whole because their companies from different industries depend on it.
Countries like Saudi Arabia and Kuwait face the stiff competition from other giant nations like the United States and Russia have started to discover new oil mines and their production has affected the prices in the world market.
This is another vicious economic cycle that happens every once in a while but it really brings many OFWs and their families to tears.
When countries experience temporary economic decline, many companies put a halt in their operational or industrial activities. Therefore, many of our OFWs are left with nothing else to do but go back home.
4. Redundancy of positions
Some companies overseas lack the competency in reviewing their manpower needs that they end up hiring many people than what is really needed. This causes redundancy of job lines or positions, which means two or more people are doing the job that can be done by one or two employees only.
Another reason is that a company may have to downsize their economic activities and therefore have to reduce the number of employees in particular departments.
5. Localization of job posts
Some big economies hire expats in order to fill in positions that can not be performed by their local people. Another reason is that the number of natives qualified for the jobs are not enough to fill in the requirements of many companies.
But as time goes by, many of these natives have started to become more competitive and qualified. Plus the fact that their population are growing as well. This forces the governments to require companies to have a cap or limit in hiring a number of expats in order to give priority to locals.
6. Wars, terrorism, unrest, climate crisis
These are instances when many expats are left with no options but to stay inside their compounds or get repatriated by their respective governments.
Not surprisingly, many OFWs opt to stay in their country of work despite the risks of losing not only their jobs but their precious lives as well. They believe it is better to be earning outside the Philippines than to be back home with their loved ones and die of hunger and unemployment.
These are just some of the common reasons why many OFWs experience job losses and mass layoffs abroad. But how can they mitigate these risks? How can they prepare for these crises? Here are my suggestions:
How To Solve and Prepare for These Crises
1. Connect with authorities and support groups
Create a directory and make a list of contact numbers of the Philippine Embassy, Overseas Workers Welfare Administration (OWWA), Philippine Overseas Labor Office (POLO) or the Labor Attache, and support groups like the Truly Rich Club and other Filipino organizations, churches, and communities.
These organizations and people should be able to support you in one way or another during a crisis. Always keep your passport and residence ID with you. Keep copies of other important documents and your contract so it would be easier to facilitate or expedite any necessary process.
2. Create an emergency cash fund
Identify how much you spend and send to your family back home each month. Multiply this by 3 to 6 months and make this as your emergency fund.
For OFW’s, a separate fund for buying plane tickets and paying for visas must also be prepared separately and kept as cash on hand. We wouldn’t know what could happen in the country where you are currently working in. I call this the Emergency Airfare Fund or EAF.
3. Get a health and life insurance
During your vacation in the Philippines, prioritize to get both a health insurance and a life insurance for yourself. If you lose your job and get sick, you health insurance will be able to cover the medical and hospital expenses. If you pass away while working abroad or when you get back in the Philippines, your loved ones will be able to survive financially because of the proceeds that they will get from your life insurance.
If it will take some more time for you to be back in the Philippines for vacation or for good, then get a term life insurance instead in the country where you are working. This is a cheaper options and a temporary protection for you until you come back home.
4. Look for passive sources of income
While working abroad, study and look for opportunies in the internet. Learn more about online internet business or ways to earn like setting up an online store, blogging, or running a website.
If you have the money and the chance, score a copy of our Cyberpreneur Philippines book online and be guided on how to start your online business. However, always take precautions as there are scams and frauds online.
5. Start a small business abroad or back home
Many OFWs are challenged or are discouraged to start a business in the Philippines because of distance and their inability to monitor them while working abroad. But nothing is impossible these days.
We have gathered some options for our OFWs in our article “What’s The Best Business for OFWs?” which also includes a 10-point questionnaire to assess whether they are ready as an entrepreneur or not.
6. Learn how to invest and start one soon
Investing in properties or real estate is the most common option among many Filipinos abroad. This is a very solid investment that may give full earning potential for your cash as most often, land appreciates over time.
However, this do not always equate to liquidity. Which means you may not be able to sell your property at a premium when you need your cash the most. Property investing is one of the best options though for your long term goals.
We highly suggest that you learn how to invest in paper assets as this is a more affordable option for many OFWs. You can start investing in stocks, mutual funds, UITFs, retail bonds, ETF’s, money market, high yield time deposits, insurance-cum-investments, shares in cooperatives, among many other options.
7. Get into agriculture
Whether it’s your backyard or your bare land in the province, getting yourself involved in farming and agriculture will always pay you good dividends in the end. During crisis, your family will be able to be sustained by your farm proceeds from livestock and crop-bearing plants and trees.
If you have a limited space in your urban home or you don’t own any agricultural land, you can try investing in “patanim/paalaga” agri-business schemes like what my friend Krissy Domingo started. She called it Agripreneur Philippines. This is also the same scheme that me and my kumpareng Doy Alvares also started in 2014.
8. Always keep a positive and healthy outlook in life
Last but not the least, believing that whatever negative things that may come your way, there will always be a better opportunity for you.
You may lose your job today but the Lord will always open a new door of blessings for you and your family.
Have a Merry Christmas and an Abundant 2016!
Rock your way to abundance!
P.S. 1. Are you an OFW who’s been looking for a investment placement where your money could grow higher than your time deposit accounts? Are you outside of Metro Manila and would like to start investing in mutual funds but have no personal advisors to help you out? Click here so I can help you open a mutual fund account NOW! .
P.S. 2. Due to popular demand, my good friend and business partner Jon Orana will be releasing again his online program called the Internet Business Master Class. This exciting online learning program is about creating and selling e-books in the internet. Here’s a FREE 23-page step-by-step guide on how to make money selling e-books including which topics to write. Enroll in Jon’s IBMC Class NOW until December 24 ONLY! Click here to enroll!
P.S. 3. Bro. Bo Sanchez has appointed me as a coach for our young and new investors at the TrulyRichClub social site. It’s a fun, learning family with the purpose of “helping good people become rich”. I’m inviting you to join the TrulyRichClub too and email me at firstname.lastname@example.org if you have any questions. Click here to join!
P.S. 4. My co-author/illustrator Des Feliciano and I have just launched our “The Adventures of Pepot Kuripot and Dora Gastadora” comic book! It’s arguably the first and only personal finance-influenced comic book in the Philippines. You may grab your copy before Christmas at your favorite National Bookstore and Powerbooks outlets. Or you can grab your copy yourself at The Pantry at 07 in Makati City and ilovemilktea in Las Pinas City. Now available also in Australia, Saudi Arabia, and the USA! Email email@example.com for more details.
P.S. 5. Yes, our Cyberpreneur Philippines book is now out in bookstores! Check out the chapters from my fellow authors Ray Calbay, Fitz Villafuerte, Ginger Arboleda, Kristel Silang, Marv de Leon, Paolo Lising, Anne Quintos, and other great online entrepreneurs and experts! Score your copy here now!
P.S. 6. Send healthcare and grocery products online to your loved ones in the Philippines via BeamandGo!