MANILA — The Philippine government should institutionalize unemployment insurance to cushion the impact of shuttered businesses and industries on millions of workers during the coronavirus lockdown, an economist said Friday.
Up to 1.5 million jobs were temporarily lost during the COVID-19 pandemic as the economy contracted by 0.2 percent during the first quarter.
“After this pandemic, we should already have a good unemployment insurance system,” said Joseph Lim, an economics professor at the Ateneo De Manila University.
The government earlier rolled out P200 billion in cash aid to help some 18 million low-income families get by during the 2-month quarantine until May.
The subsidy program also covers around 3.4 million workers in small businesses.
But funding should continue for at least 4 months for those who stand to lose their jobs this year and the next because of the pandemic, according to a paper by Lim.
He said the next few months would give the government a clearer picture of how much such unemployment insurance would cost.
Lim said an economic recession was “sure to hit this year” as a result of community quarantines where most businesses were unable to open.
“The recession will exert downward pressures on consumption, labor hiring, and incomes,” he said.
Finance Secretary Carlos Dominguez earlier floated an economic recovery package of up to P160 billion to ease the impact of the pandemic during the second half of the year.
Metro Manila, Laguna, and Cebu City are set to shift to a “modified” enhanced community quarantine from May 16 to 30, allowing certain businesses to resume up to half of their operating capacity.
The new coronavirus has killed 806 people out of 12,091 cases as of Friday.