Business loans mulled for job creation

Senator Sherwin Gatchalian wants the soonest passage of legislation that will create a business loan program to generate jobs to be able to “curb unemployment.”

The senator is pushing for the adoption of a subsidy program patterned after the US Paycheck Protection Program to stem the massive loss of jobs in the country as businesses strive to survive during the protracted quarantine period.

Gatchalian, vice chairman of the Senate Committee on Economic Affairs, wants to create a similar Paycheck Protection Program intended to provide incentives for small businesses to be able to maintain their workers.

He is suggesting that business owners be given “full loan forgiveness” as an incentive as long as the funds are used for eligible expenses, “this way, the company gets to retain its employees while maintaining its operations.”

“If we can include this in the Bayanihan 2, malaking bagay po ito sa ating mga employees, and also for our companies. Marami talagang kumpanya na nagda-downsize at sigurado akong mas marami pa ang mawawalan ng trabaho. Tiyak babalik din sila sa gobyerno, sa LGU o sa national government. Hindi na yan kakayanin ng gobyerno. Babalik at babalik sila sa gobyerno para humingi ng suporta,” Gatchalian said.

The senator said government currently provides a wage subsidy of P5,000 to P8,000 to employees under the Small Business Wage Subsidy (SBWS) through the Social Security System (SSS). But the lawmaker pointed out that “this one-time subsidy does not provide long-term support to employees.”

Many Filipinos have lost their jobs as companies downsize their operations to manage losses as they battle the economic impact of the pandemic. The Philippine Statistics Authority reported that 7.3 million Filipinos are unemployed as of April 2020, an all-time high unemployment rate.

Earlier, Gatchalian cited uncertain labor market recovery, citing the International Labour Organization’s (ILO) study of a 14% drop in global working hours during the second quarter of 2020, equivalent to the loss of 400 million full-time jobs, based on a 48-hour working week.

Gatchalian reiterated his call to prioritize the preservation of jobs in the country. The senator said the government will need an estimated P301 billion to create direct and indirect jobs for those impacted by the Covid-19-induced economic crisis for the rest of the year.

“Government has been calling on Filipinos to help spur the economy by spending more and taking advantage of record-low interest rates. But how can they think of spending his hard-earned cash during this crisis when he isn’t sure whether he’d be able to keep his job the following day. That’s why I implore the government to prioritize the preservation of jobs of our kababayans so that they’ll be able to contribute in reviving our economy back,” Gatchalian said.