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MANILA, July 2, 2005 (STAR) Filipinos working or living abroad have become a
substantial subset of the Filipino society with their remittances contributing some 9.2
percent of the country's gross national product (GNP).

Labor and Employment Secretary Patricia A. Sto. Tomas said Saturday there are now
about 8.1 million Filipinos living or working in 194 countries and territories all over the

The overseas Filipino workers (OFWs) and migrants, she said, now make up almost 10
percent of the total Philippine population.

Of the total, 3.2 million are permanently living abroad while 3.6 million are temporarily
working overseas. Irregular Filipino workers overseas, on the other hand, are estimated to
constitute some 1.3 million.

Sto. Tomas said the overseas Filipinos, including migrants remitting dollars to their kin in
the Philippines infused into the economy in 2004 a total of 8.5 billion US dollars, which
is roughly 9.2 percent of the GNP during that year.

She said that at least six percent of Filipino families are receiving income from abroad;
six out of 10 of these families reside in urban areas and are relatively better off.

Today, she added, migrant workers and their families are looked upon as the emerging
middle class and being accorded respect by the local community.

"At the same time, overseas employment is pivotal in easing the pressure on the local
labor market," she said.

With overseas employment and the attendant infusion of OFWs remittances, the country
managed to generate a consumption-led economic growth amidst recession and high
unemployment, Sto. Tomas further said.

The brain-drained economy
The woes of the Philippine aviation industry are just one example of a spreading
phenomenon that is fast undermining the Philippine economy. Low-skilled workers have
long left the Philippines for higher-earning jobs abroad. But an expanding diaspora of the
Philippines' best and brightest professionals is hitting the country's overall
competitiveness and threatens to jeopardize the viability of entire sectors of the local
economy. And indications are that what's locally referred to as "the brain-drain situation"
is set to get worse before it gets better.

POEA statistics indicate that over the past eight years, the number of Filipino workers
who have left the country in pursuit of more gainful employment abroad has averaged
880,000 a year, with destinations spanning the globe from the Americas to the Middle
East, Europe and other Asian countries. There are now more than 8 million overseas
Filipino workers (OFWs) worldwide, representing 10% of the total Philippine population
or nearly 23% of the country's labor force, according to the POEA.

"Globalization has opened a lot of opportunities for Filipino professionals," said Lalaine
Benitez-Chua, a Filipino expatriate based in Dubai who runs her own publishing firm. "I
would think that the diaspora of Filipino professionals is mainly related to the
performance of the Philippine economy - as well as the general feeling of hopelessness
the country is plagued with."

Over the past decade, two major diaspora trends have emerged. First is the rising
proportion of professionals, skilled technicians and high-end service workers who are
leaving the country for higher-paying jobs abroad. In 1992, this category of workers
accounted for about 60% of all newly hired OFWs; by 2005 that percentage had shot up
to 70%.

The second statistical trend is the so-called "feminization" of new OFWs, rising from
50% to 70% over the same 13-year period. The rising proportion of female OFWs began
as early as 1993, but the trend accelerated in 1998 with the onset of the Asian financial
crisis, which hit the Philippines' economy hard. But even though the Philippines has since
recovered from that economic downturn, the exodus of Filipino workers, especially
women, has continued apace.

"If you go to any country in the Middle East, the first things that you see at their airports
are stores or boutiques manned by Filipinas as cashiers," said Rosalinda Baldoz, a POEA
administrator. "They have Filipinas in their hospitals, their homes, and offices. The
domestic helpers, entertainers and caretakers of the elderly and incapacitated are mostly

Aging populations in rich countries such as Japan, Spain, the United Kingdom, and the
rest of Western Europe, she said, has contributed significantly to the so-called
"feminization" of the Filipino diaspora. "Nurses and caregivers - professions traditionally
dominated by females in [the] Philippines - are in demand. It's really the [global] health-
care sector that's bringing this about."
Globalization has definitely had its upside in the Philippines. Historically the Filipino
diaspora has sent home huge economic benefits to the Philippine economy through hefty
foreign-currency remittances. OFW dollar remittances have recently averaged about
US$7 billion per year, and peaked at more than $10.7 billion in 2005. Foreign remittances
currently account for about 13% of the Philippines' total gross domestic product (GDP).

This March, the monthly remittance figure was more than $1 billion, a 19% jump from
the previous month's figure. The Bangko Sentral ng Pilipinas (BSP), the Philippine
central bank, attributed the jump in remittances to the growing deployment of better-paid
skilled workers, specifically engineers, nurses, and medical workers.

While growing remittances help to spark local consumption, government policymakers

are starting to ask hard questions about the long-term economic impact of its current
success as a labor exporter. The specter of a growing "brain drain" is stoking new fears
that the Philippines might be losing more skilled workers than it can afford in critical
sectors of the economy, including health, aviation, mining, shipping, and port operations.