July 8, 2013

Youth Unemployment vs OFWs

As youth unemployment becomes an increasing trend not only in the Philippines but also in the other parts of the globe, many would be interested know the affect of this phenomena to the service exports of the Philippines.

Recent reports have found that youth unemployment in Europe (Spain and the likes) was increasing. Such increase in youth unemployment resulted to a scenario that even college graduates from well known universities accepted blue-collar jobs. The phenomena are not only happening in Europe but also in other parts of globe.

If the scenario continues, this would significantly affect the demand for OFWs. The argument is that, even locals (foreigners) are already willing to accept low paid jobs; others are willing to accept jobs without pay for the purpose of having job experience. If that is the case, there is a threat that demand for high and low skilled OFWs will decline.

If youth unemployment is increasing, the practical move is to prioritize the employment of the locals, thus, lowering demand for foreign workers. This argument is only applicable given that the country has over supply of labor. It might happen that other sectors (e.g. health sector) have little labor supply which might reverse the projected scenario.

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