Philippines: Over 9000 garment workers temporarily on forced leave or laid off as demand from global brands declines
"Philippine RMG units struggle; may see more layoffs, temporary closure", 14 October 2022
In the midst of a global demand slump and warning of temporary closures and more worker layoffs in the next few month, the Philippine garments industry appears to be struggling. Factories may have to further cut staff if demand continues to decline, Confederation of Wearable Exporters of the Philippines (CONWEP) executive director Maritess Jocson-Agoncillo said.
Around 4,000 workers were laid off by garment firms in Mactan, Cebu.
Jocson-Agoncillo said around 9,440 workers employed by CONWEP member units are temporarily on forced leave or have been laid off. This represents 3.5 per cent of the 270,000-worker base, and covers four sectors: apparel, shoes, bags and textile, she said.
“It might reach to a maximum range of 8-10 per cent if the current trend extends longer or global demand conditions worsen,” she said.
“The uncertainty of the war in East-Central Europe, rising fuel cost, the disrupted supply chain, and trepidation of another pandemic directly impacts on consumer behaviour across the globe,” she was quoted as saying by Philippine media reports.
Global clothing brands are now reducing their order projections. Companies are looking to shift their portfolios out of the Philippines and into other Southeast Asian countries such as Vietnam, Cambodia and Indonesia over high labour costs, logistics and production flexibility, she added.