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Updated November 20, 2008 12:00 AM
After the long Christmas break, workers and commercial establishments must brace for harder times.
Labor Secretary Marianito Roque yesterday advised employers and workers to get ready for the lingering effects of the financial crisis shortly after the holiday season.
“The immediate effects of the crisis may not be tangible at this time of the year (but) they will be after the holidays and at the end of the fiscal year for most private companies as well as for the government,” Roque warned.
He issued the warning as he met with representatives of various industries to discuss possible measures to avert the impact of the financial crisis on business and employment.
More than the immediate impact of the prevailing global economic crisis, Roque said commercial establishments nationwide must prepare for the “lingering effects” of the crisis in the middle- and long-term.
He said some companies might need to take stock of their skills that are critical in preserving their continued operations, or re-visit labor and establishment saving devices.
“It may be difficult to imagine how these events translate in the real world, but in the age of global trading and integrated financial systems, such cause-and-effects can be very real in finances and in employment,” he pointed out.
Roque said the Department of Labor and Employment is already putting in place a contingency plan for the looming effects of the economic meltdown.
But he said the government needs the support of the private sector, particularly the employers, in developing concrete action plans for employment amid the changing investment climate.
“At a time of extraordinary economic distress, we all need to have reliable information so that our actions are focused and effective,” the labor chief added.
Earlier, the Employers Confederation of the Philippines (ECOP) reported that many employers nationwide are already adopting cost-saving measures to help them cope with the financial crisis.
ECOP chairman Miguel Varela said many companies are now avoiding overtime work and other activities that would require additional operational cost for employers.
“As much as possible, most employers are trying to avoid additional cost in their operations so we no longer require overtime work unless necessary,” Varela said.
Early this week, President Arroyo’s economic managers allayed fears that the country would enter into a recession by next year.
They said a slowdown was quite certain, but not a recession.
They assured the public that the country’s economic fundamentals were strong enough for it not to go into recession, despite the global financial meltdown.
“There will still be growth, but not as much as we expected. We expected originally (for gross domestic product) to grow about six percent, now we’re looking at anywhere from 3.7 percent to 4.6 percent next year,” Finance Secretary Margarito Teves said.
On the other hand, National Economic and Development Authority chief Ralph Recto said “there are so many things that can be done.”
“SMEs (small and medium enterprises) will continue to do business. We still need food, clothing, shelter, basic services, education, healthcare – that will all continue.”
He added that private companies would be in a better position not to lay off workers because corporate income tax would go down next year from 35 to 30 percent under the Value Added Tax Law.
“So that’s a 20 percent reduction in corporate income tax. That would be helpful for the business community, for the business sector as well. It’s not our business to tell them what to do but that provides some leeway for them not to fire people, I suppose,” Recto explained.
He said that businesses must also consider that oil prices and inflation were going down, although these factors were volatile. – Mayen Jaymalin
Hard times seen after Christmas - DOLE
Originally Posted by cottonmouth
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