More OFW families move up to middle class: survey

by Maria Aleta Nieva Nishimori,

Posted at Oct 12 2011 10:46 PM | Updated as of Oct 13 2011 10:53 PM

MANILA, Philippines - A significant portion of families of overseas Filipino workers (OFWs) have climbed out of the low-income bracket to become part of the lower-middle-class families, according to a Nielsen Media survey released on Wednesday.

"With the study that we had in 2007, we are seeing that the families of OFWs have improved," said Ma. Cristina Estandarte, Nielsen's Client Service Manager.

Estandarte said that there is upward movement of OFW families from the lower-income groups as compared to Nielsen's previous study done in 2007.

"There is a significant percentage that moved up to the C2 income class segment. That is something positive happening with our economy and also with their families," said Estandarte.

Based on the 1,316 OFW beneficiary households surveyed this year, the DE class or lower-income families now only comprise 48% compared to 66% in 2007. From 23% in 2007, the lower middle income class families this year is at 39%.

Nielsen Managing Director Jay Bautista explained that they used a set of criteria to determine the classification of surveyed OFW families.

"In terms of actual classification, we have several criteria that we determine for low income middle class. Things like the type of house that you have, appearance of the home, appliances that you have, educational attainment, occupation, income, location of your house, if you are able to obtain your house or presence of, or absence of, cars, etc. We have a whole list of criteria that we use and a point system is applied," Bautista said.

Managing remittances

Despite the economic downturn in US and Europe and the political instability in the Middle East, more and more Filipinos are still leaving the country for work abroad.

"Filipinos are still looking for opportunities outside the country to support their families. Much of the income that they receive abroad is basically to make sure that their families survive on a daily basis," said Bautista.

Estandarte said that remittance inflow is still on the rise. In fact, the year 2010 posted a high of $18.7 billion.

"We are seeing that this will still grow despite again what's happening around us. From January to July this year, remittance already posted $11.3 billion and we are expecting a lot of remittances would come in in this 4th quarter," she said.

While majority of those surveyed or 83% say that they receive remittances on a monthly basis, 96% said that most of it is allocated for basic needs like food, utility bills, home rental, and education.

Aside from the basic needs, 17% of the respondents claimed that they try to invest and save as well.

"Hindi lang siya pang-gastos talaga lahat. So they spare a little, kahit papaano. For them to save, they invest on household appliances, they get insurance, they buy real estate, get a car, some said they started to have a business. Mayroon din pong tumataya sa lotto," Estandarte said.

Another notable improvement from the 2007 survey is the payment of loans/debt which decreased from 8% to 2% this year.

"The 2%, these are OFWs na nababayad pa po ng kanilang utang para sa sila ay makaalis...placement fees," said Estandarte. "We see that they do allocate their money wisely," she added.

Items invested on

The survey also showed that families of OFWs invest on appliances, entertainment media and gadgets like laptops and mobile phones for their children and for communication purposes.

"We saw that OFW families have higher ownership rate compared to the regular Filipino families. Given all these entertainment media that they have, and the ownership of gadgets, we see that their (media) exposure is relatively higher than the regular Filipino family," she said.

Bautista also cited a previous study that showed OFWs as one of highest internet users, tapping social media such as Facebook and Twitter, to be able to get in touch with their families.

"Which is why investments in things like mobile phones, computers and internet access is also a priority in this segment," said Bautista.

Meanwhile, compared to the regular Filipino family, more OFW families are spending time together by going to the malls (82%), supermarkets (76%), and eating out in fastfoods (83%) at least once a month.

"Looking at it as well, their consumption of going out, dining out, is higher than that of a regular Filipino family," she said.