Name


Name: Geun Ho LeeMr. SheridanTSEA (1)May 12, 2011 Tolerating Brain Drain in the Philippines: Should the Philippines? Midwife Chae Reviso came back in the Philippines, her motherland, after eight yearsworking tax-free and living rent-free in Saudi Arabia to live again with her husband.However, barely a year later, Mrs. Reviso is preparing to leave again as she finds too fewwork opportunities in her homeland. Although she came back because she felt that she owedher husband some time, she is not satisfied with the situation in her homeland as she claimsin frustration, “I cannot afford to build a house on my salary in the Philippines” (Macaraig). For decades, the problem of brain drain in the Philippines has been an on-going issue.Recently, it has gotten worse as the number of the top skilled and educated workers leavingthe country continues to rise (Alburo and Danilo). The increasing number of overseasFilipino workers (OFWs) benefits the Philippines economically as the remittances sent backhome encourage others to get educated and work abroad (Hennessey). Thus, some are contentwith the government’s inactive stance on the brain drain. Despite the economic and socialbenefits the Philippines gains from the export of its citizens, the Filipino government shouldtake more aggressive actions to minimize this, because the net effect of the brain drain isnegative, causing economic troubles, impeding the development of the nation, and causingsocial problems. The economic problems in the Philippines caused by brain drain are much greaterthan the benefits. One main economic problem experienced is that the local Filipinopopulation becomes too dependent on the remittances sent back home by the OFWs.According to the World Bank’s 2005 Global Economic Prospects report, there is evidence to
2. suggest that remittances retard local development by crowding out entrepreneurial initiative(Hennessey). This is a serious problem since the economy cannot grow or continue to existwithout entrepreneurs starting up and venturing businesses. Simply put, lack of entrepreneursputs a halt on an economy. Also, exporting skilled and educated workers makes the countryto be dependent on the economies of importing nations. For instance, the OFWs in developednations have been significantly affected by the collapse of technology stocks as thetechnology firms closed down and thereby open job positions for technology-specializedworkers intensely decreased. Thus, the thousands of technology-specialized OFWs are nolonger in demand (Alburo and Danilo). A problem arises from this because these newlyunemployed workers come back to their homeland and increase the unemployment rate athome. Again this problem caused by brain drain works against the economic growth of thePhilippines. Moreover, the most significant problem due to brain drain is that while theeconomy of the Philippines expands, it fails to acquire the attributes of a developed economy.For instance, while the educated leave the country for mental labor, the others in theworkforce are at home, working in factories or doing very basic mental labor (Alburo andDanilo). This description of the economy of the Philippines reveals that unlike the economiesof developed countries where the majority of the workforce is involved in metal labor, theFilipino economy is still driven by physical labor. Since factual data suggest that a developedeconomy is unlikely physical-labor driven one, it can be deduced that the Filipino economywill see its growth halted by this factor in the coming future. In contrast, considering some of the economic benefits of brain drain on thePhilippines, the government should not act against it. By exporting workers to other countries,the unemployment rate in the Philippines decreases. It has been statistically proven that abouta total of nine million Filipinos work overseas, which is about 10% of the total population(Macaraig) and 23% of the workforce (Llorito). This means that the remaining 67% of the
3. labor force in the Philippines can compete for jobs at home whereas the full 40 millionFilipino workforce would have to compete for the same number of jobs if it were not for thebrain drain. Moreover, the remittances sent back to the Philippines by the OFWs contributes ahuge sum to the nation’s gross domestic product (GDP). OFW dollar remittances haverecently averaged about US$7 billion per year (Llorito) and peaked at more than $11.6 billionin 2005 (Hennessey). The foreign remittances account for about 13% of the Filipino GDP(Llorito) and the specialized workers account for about 340,000, which is about 3.78% of theOFWs and about 0.85% of the Filipino workforce (Alburo and Danilo). These data show thathaving brain drain certainly helps out with the economic growth of the nation since only 0.85%of the 40 million labor force working in the foreign countries makes up roughly about 10% ofthe Philippines’ total GDP. In addition, brain drain solves the problem of providing jobs forboth the past and current generation workers. According to a study done by InternationalMigration Programme, many of the Filipino migrant workers were already in the labor forceand had come from the past decade’s professionals (Alburo and Danilo). This means that asthe previous generation’s professional workers move out of the country to work abroad, thenew professionals can find jobs at home more easily, hence effectively increasing theemployment rate. However, the brain drain is impeding the development of the Philippines. Thequestion to ponder is, “how to develop when the best and the brightest routinely set out insearch of more developed and comfortable nations?” (Hennessey) This questions how thePhilippines is supposed to develop if its brightest citizens, who can change the nation, moveout of the country. Also, the Philippines lacks incentives to offer to the brightest to keep themfrom leaving. With no solutions in sight, business groups and the government hold little hopeof keeping the nation’s top talent at home (Macaraig). This means that with the decreasingnumber of accessible skilled local workers, businesses and the government are hesitant to