Garment workers are being retrenched in the Philippines because of the global economic slowdown. There are 2,80,000 workers in the apparel, textile, garment, and leathergoods industry in the country. About four percent of workers have been retrenched. If conditions worsen, that can go up to ten percent.

The US is the biggest market of Philippine apparel, textile and leathergoods but the average US consumer is not confident of spending as they are worried about another possible recession and would rather hold back spending in the next 12 months. Orders are being canceled midstream. Aside from the global economic slowdown, other issues are disruption in the global supply chain, labor costs, and access to raw materials, logistics and compliance risk issues.

In the meantime the industry in the Philippines is hoping for a bilateral free trade deal with the US, which could be through a sectoral FTA or revival of the previous Save Act proposal, and the ratification of the Regional Comprehensive Economic Partnership (RCEP). It is also pushing for the expansion of the list of garment products eligible for zero-duty under the Generalized System of Preferences. There are only 24 tariff lines for leather goods under the GSP.