Impacts of COVID-19 on Households in the Philippines Results from the Philippines COVID-19 Households Survey Round 1 - August 2020 Background The Philippines reported the first COVID-19 case on January 31, 2020 and by March the virus spread to contaminate over 2,000 people. The Government imposed strict community quarantine measures by mid- March 2020 to contain April Mid -March May July Early -August the outbreak. Background • The economy contracted by 9 percent in the first half of 2020 due to COVID-19 quarantine measures. • Private consumption is expected to shrink in 2020 by 6.9* percent due to income losses, poor consumer confidence, and slow recovery in economic activities. • Unemployment attained 17.5 percent in April 2020, triple its level in the previous quarter. • Despite the government’s efforts to mitigate the negative effects of the pandemic on poor and vulnerable households, the outbreak and containment measures are likely to have severely affected households’ livelihoods. • Up-to-date evidence is required to assess these effects and inform policies to protect vulnerable populations. Philippines Real Time Monitoring of COVID-19 Impacts Household Firm Surveys Community Surveys Quarterly self- Surveys Quarterly phone administered web Qualitative surveys and self- survey to monitor to better understand administered web impacts on firms’ local context and to survey to monitor operations, sales identify most welfare changes in and employment as vulnerable groups households well as adjustment mechanisms Implemented by the World Bank in collaboration with the Department of Finance (DOF) and the National Economic and Development Authority (NEDA) and support from the Australian Government. Employment Income & Livelihood • Share of households experiencing Highlights (1) • One in four household heads (who used to decreases in incomes were similar across all income groups. work) no longer works. • Overall, among households’ heads • Unemployment hit the still working, about 47% have construction sector the experienced reduced income. most (31% experiencing • About 65% of farm and nonfarm employment loss), businesses experienced a decline in their revenues. followed by accommodation and • However, the share of households food services (26%) and earning no income at all was trades (25%). higher for poorer households. • Share reporting no income was 15% • The highest rate of job among households in the lowest losses were in Luzon income quintile vs. 5% among those Regions. in the highest quintile. • Over half of those who • About 24% of households reported continued working receiving remittances prior to experienced COVID-19, but 60% of them have disruptions. received less or no remittances since the pandemic. Food Security Health & Education Highlights (2) • About 40% of households • One in three households who needed medical were unable to buy essential support were not able to food products. obtain it. • Households in the poorest • Lack of money and fear of quintile were the most contamination were the severely affected⸺⸺ 54% main obstacles. compared with 26% in the richest group. • Only 20% of school aged children continued to be • Lack of money and mobility engaged in school learning restrictions were among the activities during the main reasons constraining pandemic. households’ capacity to buy food. • This drops to 11% among the poorest quintile • About three in four compared with 34% for the households worry about not richest one. having enough food and one in three experienced • About 81% of households hunger. will send back their children to school when • Around 37% of households school re-opens. in the poorest quintile were hungry and 18% went without eating a whole day. Safety nets Access to Financial • Three in four households Highlights (3) services received assistance from the government (cash, food, and • Very few households non-food). The coverage for the faced difficulties in poorest quintile households accessing financial reached nearly 90%, though services. about 60% of those in the richest quintile also benefited. • Difficulties were essentially related to Coping mechanisms mobility restrictions • Reducing food consumption and fear to contract the was most common (75%) followed virus. by delaying payment obligations (60%). Knowledge & Behavior • There was a huge difference in coping mechanisms by income • Most households are group: poorer households rely on aware of the pandemic reducing food consumption and and government borrowing from family/friends vs. actions. richer households drawing down savings and taking formal • Most households adopt credits. prevention measures. Survey 01 The Philippines COVID-19 Household Survey • Fieldwork • August 1 – 14, 2020 • Implementation • Self-administered online survey – respondents received notifications through text blast and social media ads • Phone survey - specifically targeted to lower income households from an existing list of the partner survey firm • Questionnaire • Demographics and housing characteristics • Knowledge of COVID-19 (awareness and behavior) • Government action • Access to transportation • Access to food • Access to health services • Access to education • Access to finances • Employment & income sources (respondent and household head) • Coping and safety nets The Philippines COVID-19 Household Survey • Sample and representativeness: • 26,953 respondents (CAWI: 24,391, CATI: 2,562) in urban/rural and across all regions • 9,448 final sample used in analysis due to non-response in key indicators to identify location in the income distribution and reweighting calculations • Sample weights computed based on Family Income and Expenditure Survey 2018 of the Philippine Statistics Authority • Implementation plan Round 1 August Round 3 Early 1-14 February 2021 Round 2 End of Round 4 End November 2020 April 2021 HFS unweighted HFS weighted FIES 2018 90% 80% 70% 60% Sample 50% distribution of 40% 30% the FIES 2018 20% and HFS is 10% 0% similar III - Central Luzon Urban Rural Rest of Luzon Visayas Mindanao IVa - Calabarzon National Capital Region Note: FIES is the Family Income and Expenditure Survey, which is used to estimate official poverty statistics. Locale Region HFS unweighted HFS weighted FIES 2018 70% 60% 50% 40% … even in characteristics 30% of household 20% head 10% 0% Age Education Demography 02 70% 60% 50% 40% 30% Demographic profile of 20% respondents 10% 0% Gender Age Education Employment & Income 03 One in four household heads who were employed in early 2020 Continue working are no longer working 76 % Household Head Stop working 24 % Work status of household heads Around 75% of household heads were engaged in any type of work in February 2020 working • This declined to 60% in working August. • Forced closure of business (due to quarantine restrictions or other reasons) caused 43% of the job working losses. not working not February August Regions in Luzon experienced more job losses than in other areas Percentage of employed heads who are no longer working in August (%) 35 30 • About 31% of household heads in the National Capital Region and 25 neighboring Regions III and IV-A who 20 were working in February lost their 15 jobs. 10 • These are the areas with high COVID- 19 cases. 5 • Job losses were similar in urban and 0 rural areas. NCR, 3, 4A Rest of Luzon Visayas Mindanao Job loss by sector Industry and services were the most affected sectors Agriculture Construction • About 28% of household heads Manufacturing who were working in industry and 23% of those working in Other industry services lost their jobs, compared Trade with 18% for agriculture. Accomodation and food services • Sectors that shed jobs the most are construction (31%), Transportation, storage & communication accommodation & food services Other services (26%) and trade (25%) 0% 10% 20% 30% 40% Job loss was experienced across all income groups Job losses by income quintiles (%) 30 • Job losses were slightly higher among the 25 richest income quintile than the poorer ones. 20 • This is because poorer households are 15 more prevalently employed in agriculture, 10 which was less affected by the COVID-19 related restrictions. 5 • Most of those in the 3rd and 4th quintile 0 Poorest Q2 Q3 Q4 Richest Total work in services sector that were able to Quntile Quintile adjust to home-based work. Sectors with severe work disruption The Pandemic caused Information and Communication severe work disruptions Education Food and Beverage Service • About 52% of those working in Activities August were not able to work as Water Supply; Sewerage, Waste Management usual. Professional, Scientific and • Some sectors in services ⸺⸺ ICT, Technical Activities education and technical Arts, Entertainment and Recreation activities⸺ enabled more home- based work. Real Estate Activities • Other sectors in industry, Wholesale and Retail Trade transport and farming faced severe disruptions. Agriculture, Forestry and Fishing • About 12% of those who continued Transportation, Storage, Postal and Courier to work changed jobs. 0 20 40 60 80 100 Able to work as usual Working from home Not able to work as usual Working household heads experienced income losses Same/ more income 43% Continue working Reduced income 76% 47% No income Household 10% Head Stop working 24% Poorest Quintile Poorer households experienced more reduction in incomes Q2 • Nearly half of household heads in the richest quintile saw their earnings increase or remain the same compared Q3 with 40% of those in the poorest group. • Around 15% of working household Q4 heads in the poorest group did not have any income, but it remains unclear whether this is because they are in Richest unpaid occupations or if their employer could not pay them. 0 20 40 60 80 100 Increased Same Decreased No income 100 Income loss was more prevalent 90 amongst household heads working in agriculture 80 70 • Nearly 70% of those working in agriculture experienced a decline in 60 their income or did not receive any 50 income. 40 • Incomes remained on average more stable in services than in industry, 30 where mining and construction 20 experienced severe income declines. 10 • However, households whose head works in some services subsectors such 0 Agriculture Industry Services transport, food and accommodation Increased Same Decreased No income have faced large income reductions. 80 Households operating farm businesses were severely affected 70 by revenue losses Proportion of household heads (%) 60 • About 30% of households in the 50 poorest quintile, and 23 % in general population operate farming businesses. 40 • About 65% of these households 30 reported a decline in their incomes and another 15% did not have any revenue. 20 • While the losses were felt across all 10 income groups, they were more prevalent among the poorer ones. 0 Poorest Q2 Q3 Q4 Q5 - Total richest Operate farm business Experienced decline in revenues 80 Households operating non-farm businesses also experienced 70 income loss Proportion of household heads (%) 60 • One in five households operate a non-farm 50 business. • Better off households tend to operate these 40 businesses more than poorer ones. 30 • Over 60% of these households reported a decline in their revenues and another 13% did 20 not have any income. • The declines were higher among the poorer 10 groups, where 67% of households experienced a fall in their revenues, compared with 58% in the 0 Poorest Q2 Q3 Q4 Richest Total richest group. Operate nonfarm business Experienced decline in revenues 80 Many households suffered reductions in remittances 70 receipts Proportion of household heads (%) 60 • About 24% of households declared usually receiving remittances, with half of them 50 domestically and the other half from abroad. • Domestic remittances are more common 40 among poorer households and foreign remittances more common among better off 30 groups. • About half of households who usually receive 20 remittances saw a decline in their receipts in August and 11% did not receive any 10 remittances. • While reduction in remittance incomes are felt 0 Poorest Q2 Q3 Q4 Richest Total across all groups, higher proportion in lower income groups. Receive remittances Declined Did not receive Food Security 04 Poor households faced severe constraints in buying staple food 50 • About two in five households 45 40 were not able to buy rice, meat, fish, eggs or vegetables. Proportion of households (%) 35 30 • The constraints were 25 significantly more 20 pronounced among poorest 15 households than better off 10 5 ones. 0 Poorest Q2 Q3 Q4 Richest Total Rice Protein Fruits & Vegetables Financial constraints were the main liming factors to buy staple food • Over 70% of households 100 reported lack of money as the 90 main reason they were not able 80 to buy rice, protein or 70 vegetables. 60 50 • Other limiting factors were 40 mobility constraints due to 30 limited transport, restrictions to 20 go out or fear to contract the 10 virus. 0 Poorest Richest Total Poorest Richest Total Poorest Richest Total • Price increases limited access to Rice Protein Fruits & vegetables fruits & vegetables for poor Lack of money Local markets closed Mobility restrictions households. Increase in price Other Households experiencing food insecurity (%) Households with reduced 90 income experience food 80 insecurity 70 60 • About 70% of households 50 reporting lower or no income ate less than usual. 40 • About 30% of these 30 households experienced 20 hunger. 10 • About 15% have experienced not eating the whole day. 0 Worried about not Ate less than Ran out of Food Hungry but did Went without having enough usual not eat eating the whole food day HHs w/ reduced or no income HHs w/ no change in income Human Capital 05 Obtained needed One in three medical treatment Reason for not obtaining medical households who treatment needed medical attention was not able to obtain it Lack of money / Cannot afford, No 46% Lack of money was 33% the primary reason for not getting medical treatment Afraid of Yes contracting 67% COVID-19, 28% ….followed fear of contracting the virus Mobility restrictions, 13% …. and constraints in Facility full/lack health care facilities. staff, 10% Others, 2.8 Share of households with children in school, by quintile (%) Very few children were engaged 90 in learning activities during quarantine 80 70 • About 80% of households with school 60 aged children(6-18) attended school before the pandemic struck. 50 • Of these, only 20% continued to be 40 engaged in learning activities during community quarantine. 30 • This was even lower among households 20 in the bottom quintile (only 11%). 10 • Of those who continued learning, distance learning was the most cited 0 mode of instruction. Poorest Q2 Q3 Q4 Q5 Total Attending school in March Continued Learning 81 percent of Among housheolds w/ children attending school before the pandemic… households with school age children will continue schooling when schools re-open Afraid to catch COVID-19, 14% Continuing Not continuing About 80% of 81% 19% households in the bottom will continue schooling for their children No gadget/internet, 2% Lack of money, 2% School not ready, 1% Fear of contracting Others, 0% COVID-19 is the top reason for not continuing Access to Financial Services 06 Tried to Acess Financial Service (%) One in three households tried accessing financial Remittance Agent services ATM • Remittance agents and ATMs are the most used channels (36%). Mobile Money • The gap in access to financial services between income groups varies by the channels for Bank financial services. • The gap is smallest among Microfinance, NGOs microfinance/NGOs and cooperatives as well as remittance agents. Cooperatives • In contrast, poor households lag 0 10 20 30 40 50 60 far behind in accessing ATM, All Q1 - poorest Q5 - richest mobile money, and banks. 8 Of the households accessing 7 financial services, very few faced Proportion of households facing difficulties in access to restrictions 6 • About 5% of households declared financial services (%) 5 having faced problems in accessing bank, mobile money, microfinance, 4 ATM or any other financial services. • Better-off groups seem to have felt 3 more restrictions than poorer ones, probably because they use more 2 these services. 1 • Restrictions on going out and fear of contracting the virus were the main 0 reasons households could not Poorest Q2 Q3 Q4 Richest Total access financial services. Knowledge and behavior 07 Have received information on COVID -19 from: Almost everybody is Neighbors/family/friends Community aware of COVID-19 Health clinic/hospital Church/pastor/traditional healer Government Local government National government • About 99% have heard about the pandemic Television Radio • About 9 in 10 received information on COVID 19 from Media Website immediate circle (neighbors, Poster/billboard/flyer/leaflet family and friends), government and television Newspaper Social media • 1 in 2 cited television as their Facebook/twitter/social media main source of information SMS/text 0% 20% 40% 60% 80% 100% Awareness of government action (%) Awareness on government Advised citizens to stay at home action is high Closure of schools and universities Imposition of lockdown, closed roads • About 9 in 10 are aware of or added police the measures taken by government to curb the Imposition of curfew spread of the virus. Restricted public gatherings • Action is mainly attributed to the National Government. Restricted travel whether local or international • 7 in 10 are satisfied with government (both national Disseminate knowledge about the and local) response. virus 0 20 40 60 80 100 National Government Local Government Wore a face mask Filipinos adopted prevention measures Washed hands more than usual Practiced social distancing • Almost everyone has adopted Stockpiled food, water and other supplies basic prevention measures (wearing face mask, washing Stayed home because you felt unwell hands, social distancing). Visited a doctor/hospital • About 8 in 10 households have stockpiled on supplies. Cancelled or postponed medical/dental appointment 0% 20% 40% 60% 80% 100% Safety Nets & Coping Mechanisms 08 Received Assistance by Quintile (%) 100 Safety nets helped many 90 vulnerable households 80 • Three in four households 70 received assistance from the 60 government (in the form of cash grants, food and non- 50 food items). 40 • Coverage was very high 30 among the poorest groups 20 with about 87% in the bottom quintile receiving government 10 assistance. 0 Q1 - poorest Q2 Q3 Q4 Q5 - richest Total • Support from family and Government Friends & Family NGO/church friends was also high. Household's Coping Mechanism (%) Consumption reduction was among most used coping Reduced consumption: food mechanism by poor households Reduced consumption: non-food The most common coping mechanisms used by households Delayed payment obligations include: • Reduce consumption or shift to Relied on savings cheaper alternatives. ✓ About 4 in 5 of households in the Borrow: Family & Friends bottom quintile reduced their food consumption. Borrow: Credit card • Three in five households delayed payment obligations. Borrow: Financial institution • More than half of the households used their savings. 0 20 40 60 80 100 • About half of the households have Q1 - poorest Q5 - richest Overall borrowed from family and friends.