By yearend, Mactan export zones set to cut 30% of jobs

CEBU, Philippines - Due to the worsening impact of the global economic recession to the country’s export and manufacturing business, firms operating in the three export processing zones in Mactan are expected to lose around 20 to 30 percent more jobs by yearend, according to a local business chamber official.

At the 888 News Forum yesterday at the Waterfront Cebu City Hotel and Casino, Mactan Chamber of Commerce and Industry president Efrain Pelaez said that after personal interviews and meetings with chief executive officers (CEOs) of big multi-national companies operating in MEPZ, he noted that a lot of casual and regular workers have been laid off starting late last year.

He said that compared to the data given by the Department of Labor and Employment (DOLE), their estimated figure of total job contraction for this year will have to reach around 20 to 30 percent by yearend.

Pelaez said that this is due to the continued decline of orders and demand brought about by the worldwide slowdown.

He said that export firm Maitland Smith, for instance, has so far laid off 750 casuals and 150 regular employees, which is the first in the last 20 years of the company’s operation.

Even other big firms like Timex and Lexmark have also laid off their regular employees as worldwide demand is badly down.

He said that regular employees in the three economic zones are estimated at around 60, 000 and take 20 percent off this number that would generate a total of 12, 000 estimated laid off workers by yearend.

“This situation is going to be a prolong recession though the government and some businessmen are still optimistic. Comparing it to the previous Asian Financial crisis, this is worldwide. This is going to be a long and severe recession as the world is suffering and most large and strong economies such as US, France, Japan and Germany are having hard times,” said Pelaez.

He also said that at this point, even subcontractors are badly affected with the slowdown of businesses in the processing zones.

“Many export firms rely on subcontractors to do some of their processes, so when a big company operating in MEPZ closes down or slows down its operations due to low orders many small and cottage industries will also go out of business and this is a serious multiplier effect,” pointed out Pelaez.

However, he said that to help displaced workers in Mactan, their chamber have initially made efforts to establish linkages with aligned agencies that offers programs for displaced workers.

“Everybody is now clearing off their inventories and they cannot do anything but let go of their workers because demand of their products and services are down. We at the Chamber are committed to help in any way we can and we are planning to initiate trainings so that they can get alternative jobs in the tourism industry,” he added.

Pelaez also stressed that as indicator of the major slowdown of business movements in Mactan is the decline of the commercial and retail components in the area.

He said that for Marina Mall’s operation alone, around 10 to 20 percent decline of sales has been noted since the start of the recession and there have been several closures of business establishments such as restaurants in the area because of slow sales and business activity.