Lesson 3.

The Impact of Labor

Migration on the Prices of
Basic Commodities

Applied Economics
General Academic Strand | Accountancy, Business, and Management
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Many Filipinos are trying
their luck outside of the
country because of
economic opportunities.

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This actually affects our
labor market, quality of
living, commodity
pricing, and the overall
economy.

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 Learning Compare the prices of commodities and
Competency
analyze the impact on consumers (ABM_AE12-
Ie-h-6).

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Learning
Objectives
● Discuss the impacts of labor migration on
Philippine households’ quality of life and
commodity pricing.

● Analyze the impacts of migration on a

country’s economy.

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 Three Reasons Why
Let’s
Connect
● Migration does not necessarily mean moving
to another country. It could be moving to a
different city, province, or region.

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 Three Reasons Why
Let’s
Connect
Vote on which of those situations are the most
common reasons for migration.

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 1. In your opinion, why were the top three
Let’s answers chosen as the most common
Connect
reasons people migrate?

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 2. If the three situations were addressed and
Let’s resolved, would people still migrate
Connect
elsewhere? Why or why not?

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 3. Are there other reasons, apart from the
Let’s teacher’s examples, that you know of? Give
Connect
at least three.

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Essential
Question

How does migration impact the Philippine

economy?

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 Migration

● It is the movement of
individuals from one place
to another.
● Migrants are classified as
one of the following:
emigrants, immigrants, or
refugees.

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 Migration
Different Kinds of Migrants

● Emigrants are people who leave one country or

region to settle in another.
● Immigrants enter and settle in a foreign country or
region, leaving a past home.

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 Migration
Different Kinds of Migrants

● Refugees are people

who, because of a
problem in their former
home, have immigrated
to a new country or
region.

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 Overseas Filipino Workers

● These are people from

the Philippines who live
and work in another
country temporarily.
● Their remittances
benefit their families
and the economy.

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 Overseas Filipino Workers
Different Kinds of Workers

● White-collar workers are known as suit-and-tie

workers who do professional, desk, managerial,
and administrative work.
● Blue-collar workers are workers who engage in
hard manual labor.

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 Overseas Filipino Workers

● According to the 2019 Survey on Overseas Filipinos, the

number of OFWs who served abroad between April
and September 2019 was estimated to be at 2.2
million.
● The continuous increase in the number of workers
leaving the country poses a concern on the country’s
labor supply, as it can slow down economic growth.

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Check Your
Progress

How important are blue-collar and white-collar

workers to a country’s economy?

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 Push and Pull Factors

Push factors are negative reasons that cause people to leave

their homes.

Pull factors are positive aspects that attract people to move

to another region or location.

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 Push and Pull Factors
Different Push Factors
● high crime rates and
violence
● social inequality
● environmental degradation
and natural calamity
● lack of access to basic
necessities
● internal political disputes
and war 21
 Push and Pull Factors
Different Pull Factors

● low crime and violence

● social equality
● economic and job
opportunities
● easy and affordable access
to basic necessities

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 Effects of Migration
Decrease in National Poverty Incidence

● A 10% increase in per capita income leads to a 0.4% to

0.2% reduction of families living below the poverty line.
● However, most Filipinos that migrate come from more
affluent regions.

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 Effects of Migration
Decrease in National Poverty Incidence

● The largest proportion of OFWs come from

CALABARZON at 20.7%, while the region’s poverty
incidence is 5.1%.
● The lowest proportion of OFWs is in MIMAROPA at
1.5%, while the region’s poverty incidence is 10.5%.

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 Effects of Migration
Changes in Labor Supply

● A drop in the labor supply encourages competition

which can drive wages high (ceteris paribus).
● However, there’s a loss of potential labor that can
contribute to the country’s productivity.
● It decreases labor participation among the remaining
members of the household.

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 Effects of Migration
Positive and Negative Effects of Remittances

● If remittances are invested in creating businesses in the

country, it can create job opportunities in the
community.
● But, it is possible for families to be remittance-
dependent, they may leave their jobs or not look for
them.

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 Effects of Migration
Remittances on Commodity Pricing

● Remittances can impact commodity pricing through

income-driven demand.
● An increase in household income can increase
purchasing power, which drives demand upwards. It
results in an increase in commodity pricing, ceteris
paribus.

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 True or False. Identify whether the following statement
is true or false.
Try This!

1. Immigrants are people who leave a place

to live in another.

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 True or False. Identify whether the following statement
is true or false.
Try This!

2. OFWs contribute to the country’s economy

through their balikbayan boxes.

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 True or False. Identify whether the following statement
is true or false.
Try This!

3. Blue-collar workers are usually the ones

doing manual labor.

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 True or False. Identify whether the following statement
is true or false.
Try This!

4. An emigrant is a person who joins a nation

from another to build a new home.

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 True or False. Identify whether the following statement
is true or false.
Try This!

5. Remittances do not have an impact on the

country’s commodity pricing.

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 ● Labor migration is defined as the movement of
Wrap-
Up individuals from their home location to another
location.
● Emigration is leaving a home country or region,
while immigration is arriving at another country
or region.
● Refugees are a group of people who left their
home country or region because of unfortunate
circumstances such as war, famine, poverty,
natural calamities, etc.
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Wrap- ● Overseas Filipino Workers (OFW) are a group
Up
of people from the Philippines who live and
work in another country on a temporary basis.

● Pull factors are those that attract a population

to another region or location, while push
factors are those that cause a population to
leave home.

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Challenge
Yourself

In general, is migration a good thing? Why or

why not?

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Photo Credit

Slide no. 16:

These guys are assembling the tent for an event the at the capital city of Brunei. Taken on 19 January 2014 b
y jyppe.com
by User:Jpquidores is licensed under CC BY-SA 3.0 via Wikimedia Commons.

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Bibliography

Asis, Maruja M.B, “The Philippines: Beyond Labor Migration, Toward Development and (Possibly) Return.” 2017:
https://www.migrationpolicy.org/article/philippines-beyond-labor-migration-toward-development-and-possi
bly-return

Oecd-ilibrary.org, “Migration and the labour market in the Philippines,” 2017:

https://www.oecd-ilibrary.org/development/interrelations-between-public-policies-migration-and-developme
nt-in-the-philippines/migration-and-the-labour-market-in-the-philippines_9789264272286-8-en

David, Frederic Camroux, "Nationalizing Transnationalism? The Philippine State and the Filipino Diaspora," 2008:
Sciences Po publications info: hdl:2441/7i7knjo7kv8, Sciences Po.

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Bibliography

Pacete, Paulina Kim C., “Philippine Labor Migration Factbook 2016”, 2016:
https://ils.dole.gov.ph/philippine-labor-migration-factbook-2016/

Simon J, Kiss N, Łaszewska A, et al. Public Health Aspects of Migrant Health: A Review of the Evidence on Health
Status for Labour Migrants in the European Region. Copenhagen: WHO Regional Office for Europe; 2015.
(Health Evidence Network Synthesis Report, No. 43.) ANNEX 2, DEFINITIONS OF LABOUR MIGRANTS.
Available from: https://www.ncbi.nlm.nih.gov/books/NBK379428/

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