DESPITE the availability of assistance programs and light payment or investment schemes, only two overseas Filipino worker (OFW) households out of 10 choose to invest or save the remittances they regularly receive.
Based on a study made by The Nielsen Co., only around 17 percent of households said remittances go to savings and investments, while a whopping 96 percent of OFW households spend it on basic needs, such as food, utilities, bills, rent and education.
Only 2 percent use remittances to pay for loans.
The 17 percent of households who save their money put their remittance on savings, invest on household appliances, insurance, real estate, a car or in business, and buy lottery tickets.
“The other thing we’re seeing is their economic classification has improved dramatically since five years. So they are becoming a larger part of the middle class. So I think based on the two studies we’ve seen, if the OFWs handle their resources well, chances are they will improve the level of their [income],” Nielson Managing Director Jay Bautista said on Wednesday.
Based on the company’s latest OFW survey, around 48 percent of OFW families belonged to the DE class, or the low-income class, while 39 percent now belonged to the C2 or lower-middle class segment. Those who belonged to the upper middle class or C1 and the elite or AB class both increased to 8 percent and 5 percent, respectively.
In Nielsen’s 2007 OFW survey, majority of OFW families—or around 66 percent—belong to the DE class and only 23 percent belonged to the C2, or lower middle class segments. Those who belonged to the C1 and AB class only accounted for 7 percent and 4 percent, respectively.
Meanwhile, the Nielsen survey also showed that even with the Japan and the Middle East and North Africa crises in the first part of the year, OFWs remittance remained steady.
While this does not prove that OFWs were not affected by these crises, Bautista said OFWs found a way to be more creative in sending their remittance and many chose to stay despite the difficulty of the situation. This enabled them to keep sending remittance amid the crisis in the countries they work in.
“I think they were affected [by the crises], it’s just that the resiliency of the Filipino tends to kick in so some of them didn’t want to go home despite the violence. Some of them found creative ways of addressing the situation,” Bautista said.
In 2010 OFWs sent a total of $18.7 billion worth of remittances.
With deployment steady and the January to June 2011 remittance figure already way above the half-year level last year, Bautista said this year is bound to be another growth year for remittances.
Government figures showed that for the January-to-June period, OFWs already sent $11.3 billion worth of remittances, despite the global crises, which initially was expected to cut remittances in 2011.
Economists believe that while June remittances were high due to the opening of classes, the US credit downgrade and the overall weakness in the global economy are likely to cause remittances to dip.
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By: Cai U. Ordinario
Source: Business Mirror, Oct. 12, 2011
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