Yale School of Management

Program on Financial Stability

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The Philippines Provides Support to Workers in the Informal Economy

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The Philippines government has included a temporary short-term work program that aims to employ close to 1 million workers in the informal sector in its COVID-19 response package.The TUPAD #BKBK program provides temporary employment opportunities to workers in the informal sector, as these workers are particularly vulnerable to economic hardship due to the COVID-19 pandemic.

Informal sector workers are those who do not have secure employment contracts and generally do not have benefits or access to a social safety net. According to the International Labour Organization, the informal economy in the Philippines consists of independent, self-employed small scale producers and distributors of goods and services. Nearly 40% of the workforce in the Philippines is considered employed in a “vulnerable” source of employment, which is a proxy measure for the informal economy. 

The Department of Labor and Employment (DOLE) manages the TUPAD #BKBK program (Tulong Panghanapbuhay sa Ating Disadvantaged/Displaced Workers, Barangay Ko, Bahay Ko). The TUPAD #BKBK program provides the minimum wage to unemployed informal sector workers to perform disinfection and sanitation work of their dwellings and the surrounding areas for 10 days. Individuals will also undergo an orientation on safety and health and be enrolled in group micro-insurance (insurance policies specifically targeted to disadvantaged individuals). 

The TUPAD program is an existing DOLE program that provides short-term employment opportunities to displaced, underemployed or seasonal workers for a minimum of 10 days and a maximum of 30 days. Individuals work on infrastructure projects such as repair or maintenance of public facilities or bridges, and agro-forestry projects such as reforestation. The TUPAD #BKBK program is an emergency measure specifically designed to support individuals during the COVID-19 pandemic. Funding for the TUPAD #BKBK program comes from the DOLE’s 2020 budget, with more than PHP 1 billion spent as of April 29

As of May 10, 337,000 workers received benefits from the TUPAD #BKBK program, with a total of 540,000 expected to benefit from the TUPAD #BKBK program and a total of 962,000 expected to benefit from all TUPAD measures. 

The DOLE is expanding the emergency program to allow local government units to provide short-time employment for delivery of essential goods and services, including PPE. Local governments can also hire workers for the packaging of support equipment, transportation of front-line workers, and sanitation and disinfection of communities. 

At the end of April, the DOLE announced that it planned to continue to leverage the TUPAD program during the COVID-19 recovery phase. The post-COVID TUPAD program, which has PHP 4 billion in funding, is set to operate in May and June in regions under the general community quarantine. 

Providing short-term public employment appears to be a relatively uncommon emergency measure to support informal sector workers. However, the Philippines is also providing financial assistance in the form of cash grants to individuals, including those in the informal sector. The Emergency Subsidy Program is a PHP 205 billion emergency subsidy program for 18 million low-income families. Families with low incomes, including those who work in informal sector jobs, are eligible. Families receive between PHP 5,000 and 8,000 for two months. By May 2, PHP 60.6 billion had been distributed to 11.3 million beneficiaries, and the government added an additional 5 million families on May 4. The Department of Social Welfare and Development will also provide Livelihood Assistance Grants (LAGs) to beneficiaries of the existing Sustainable Livelihood Program, who have at least one family member who works in the informal sector who is displaced by the lockdown measures. LAGs will be granted after the quarantine ends.