Costly Discrimination

By Francis Allan L. Angelo

The Philippines is losing between PHP 65.6 billion and PHP 147.6 billion every year due to workplace discrimination, wage disparities, and healthcare costs linked to LGBTQ+ exclusion. A report by Open for Business, a coalition of global companies advocating for inclusive growth, places these losses at 0.30% to 0.67% of the country’s Gross Domestic Product (GDP). Beyond mere statistics, this underscores the significant economic damage wrought by discrimination and exclusion against LGBTQ+ individuals, not just in human terms but also in national development.

This report, like others before it, shows a broader trend. Countries and economies that embrace diversity and inclusion consistently outperform those that remain stagnant in their social policies. In a nation like the Philippines, where resilience and productivity are celebrated traits, this continued exclusion is tantamount to economic self-sabotage. We cannot afford to let billions slip away when a shift in societal attitudes and legal frameworks could reverse this tide.

Wage Disparities and Workplace Discrimination

While conversations around LGBTQ+ rights often focus on human rights and equality, the economic implications of discrimination are less frequently discussed.

The numbers are clear: a significant portion of the economic losses comes from wage disparities and workplace discrimination. The report estimates that PHP 32.9 billion to PHP 49.3 billion is lost annually because LGBTQ+ individuals are often paid less or are subject to biased hiring, promotion, and workplace practices. Despite their qualifications, LGBTQ+ employees face hurdles that non-LGBTQ+ counterparts often do not.

Wage inequality is rampant, and studies consistently show that marginalized groups, especially LGBTQ+ workers, are likely to earn less over their lifetime. Research from the International Labour Organization (ILO) underscores that LGBTQ+ employees are frequently overlooked for promotion and leadership opportunities. Moreover, those who do not conform to traditional gender norms or sexual identities face microaggressions or outright hostility in the workplace, often forcing them into lower-paying, informal jobs.

For example, the ILO report, LGBTI People and Employment Discrimination in Asia, highlights cases of Filipinos in corporate settings who were either fired or denied promotion after being open about their gender identity. This also aligns with findings from a 2021 report by UCLA’s Williams Institute, which detailed that globally, LGBTQ+ workers often face wage penalties compared to their heterosexual counterparts. The compounding effect of lower wages and job instability restricts LGBTQ+ individuals from contributing their full potential to the economy, stifling overall growth.

Discrimination in the workplace, whether overt or subtle, affects productivity and business performance. According to a 2020 study by the United Nations Development Programme (UNDP), LGBTQ+ individuals in the Philippines are often relegated to lower-paying jobs or are denied promotions because of their sexual orientation or gender identity. This creates a less motivated, less engaged workforce and hinders overall economic productivity.

Health Care Costs: A Growing Burden

Discrimination also hits hard on healthcare costs. The Open for Business report estimated that the health costs related to LGBTQ+ exclusion—particularly those tied to depression and HIV—add between PHP 32.8 billion to PHP 98.3 billion in economic strain annually. LGBTQ+ individuals disproportionately experience mental health struggles due to social stigma, discrimination, and lack of family or community support, contributing to higher incidences of depression and suicide attempts.

Moreover, HIV remains a significant health issue for the LGBTQ+ community, particularly for gay and bisexual men. According to the Department of Health (DOH), HIV cases in the Philippines are on a steep rise, with young LGBTQ+ individuals among the most affected. While much has been done to educate the public and encourage safe practices, there remains a need for greater inclusion in healthcare policies and a supportive environment to address this growing epidemic.

Healthcare inequality results not only in higher costs for individuals but also in a broader economic burden, as people struggle to maintain employment or contribute to the economy when faced with untreated health conditions. The economic case for inclusive healthcare is simple: when everyone has access to necessary services, the overall health and productivity of the population improve. Conversely, exclusion not only harms LGBTQ+ individuals but strains public resources and curbs potential economic contributions.

Research by the World Health Organization (WHO) corroborates this point, showing that LGBTQ+ individuals are at a higher risk for mental health issues due to the constant stress of discrimination and social isolation. The same report highlights that HIV rates among LGBTQ+ individuals remain disproportionately high in countries where sexual minorities face exclusion and stigma, such as the Philippines. Without comprehensive healthcare policies tailored to the needs of the LGBTQ+ community, these health disparities will continue to widen, placing further strain on the healthcare system and the economy at large.

Brain Drain: A Drain on Talent and Innovation

Beyond the immediate impacts of wage gaps and healthcare costs, LGBTQ+ discrimination contributes to the so-called “brain drain,” where skilled professionals leave the Philippines in search of more inclusive environments. The Open for Business report found that discrimination leads talented individuals to seek work in more LGBTQ+ friendly countries like Australia and the United States. When such talent departs, the local economy loses innovative and competitive energy.

Aris Ambal, Vice President and PRIDE APAC Regional Lead at JPMorgan Chase, highlighted this issue in the report, stating that “LGBTQ+ discrimination leads to direct losses in human capital.”

A 2022 study published by the International Labour Organization (ILO) found that countries with inclusive policies tend to retain more highly skilled workers, fostering innovation and economic growth. In contrast, countries that fail to protect LGBTQ+ individuals from discrimination are likely to suffer from reduced competitiveness on the global stage. The Philippines, with its growing outsourcing and tech industries, cannot afford to lose its top talent to more inclusive economies.

A World Bank study on Southeast Asian economies notes that countries that actively promote inclusion tend to attract and retain top talent, while those with restrictive social policies see their most skilled workers leaving. Losing a skilled workforce diminishes the country’s capacity for innovation and competitiveness, particularly in industries such as technology and the creative sectors, where LGBTQ+ professionals often excel. In this regard, the exodus of LGBTQ+ talent can be seen as a significant missed opportunity for national progress.

According to a 2019 survey by the Philippine LGBT Chamber of Commerce, nearly 70% of LGBTQ+ professionals in tech and creative industries considered migrating due to workplace discrimination. When they leave, they take with them not just their expertise, but also their contributions to the economy and society at large. Talent migration, driven by hostile environments, ultimately weakens the Philippines’ global standing and reduces its competitive edge.

Tourism and Foreign Investment: An Untapped Market

The economic losses from LGBTQ+ exclusion are not limited to labor markets. The tourism sector, one of the Philippines’ key economic drivers, is also impacted by discriminatory policies. The Open for Business report points out that countries with inclusive LGBTQ+ policies tend to attract a more diverse range of tourists, who contribute significantly to economic growth.

LGBTQ+ travelers often seek destinations that are welcoming and supportive of their identities. According to a report by the World Tourism Organization, the global LGBTQ+ travel market is estimated to be worth over USD 211 billion annually, a lucrative segment that the Philippines has only begun to tap into.

Without stronger legal protections for LGBTQ+ individuals, the Philippines, despite its natural beauty and cultural appeal, remains behind more inclusive competitors like Thailand, which markets itself as a LGBTQ+ friendly destination.

Thailand has positioned itself as a top destination for LGBTQ+ tourists by implementing inclusive policies and promoting LGBTQ+ events, which in turn boosts its economy. In contrast, the Philippines’ lack of nationwide anti-discrimination laws limits its appeal to this valuable market, particularly as safety concerns around LGBTQ+ discrimination remain prevalent.

Failure to tap into this lucrative market means the country is missing out on billions in potential tourism revenues.

Foreign investment is another area impacted by the country’s approach to LGBTQ+ inclusion. Companies operating globally are increasingly factoring in social policies when making decisions about where to invest. In countries with strong LGBTQ+ rights, businesses often see better governance and transparency, factors that contribute to a stable and inviting investment environment. However, the Philippines, despite its economic potential, struggles with corruption and weak social protections, which deter investors who prioritize diversity and inclusion in their operations.

The Role of the SOGIE Bill and Legal Frameworks

One of the central legal challenges in addressing LGBTQ+ discrimination in the Philippines is the ongoing debate over the Sexual Orientation and Gender Identity Expression (SOGIE) bill, which seeks to provide legal protection against discrimination based on sexual orientation and gender identity. Advocates for the bill argue that its passage is not just a matter of fairness but also a step toward boosting the economy.

Countries that have enacted comprehensive anti-discrimination laws, such as Canada and the Netherlands, have seen significant economic benefits as a result of LGBTQ+ inclusion. These benefits extend beyond the workplace and into broader societal outcomes, including reduced healthcare costs, higher productivity, and a more robust innovation ecosystem. A 2018 study by the Williams Institute at UCLA found that countries with stronger LGBTQ+ rights tend to have higher levels of economic growth, lower levels of corruption, and improved business environments—factors that are critical to attracting foreign investment and promoting sustainable development.

Pathways to Inclusivity and Economic Growth

As the Philippines seeks to enhance its global competitiveness and foster sustainable economic growth, addressing LGBTQ+ discrimination is emerging as a crucial factor. The economic case for inclusion is clear: it is not just a matter of rights and fairness but also one of economic pragmatism. By eliminating discriminatory practices and fostering a more inclusive environment, the Philippines stands to gain in terms of innovation, productivity, and international reputation.

Stephanie Galera, head of Southeast Asia for Open for Business, voiced optimism about the future, noting that while progress has been made in cities like Quezon City—which has implemented local ordinances supporting LGBTQ+ communities—there is still a long way to go at the national level.

Without national legislation such as the SOGIE bill, broader progress remains elusive. Until these protections are secured, the country risks continuing to lose valuable talent, investment, and economic opportunities.

“The Philippines continues to make strides for LGBTQ+ citizens and visitors alike, and we hope this report helps strengthen the brilliant work being done by civil society and business leaders,” Galera said.

The findings from Open for Business should serve as a wake-up call for both policymakers and business leaders. LGBTQ+ inclusion is not just a moral imperative but an economic necessity. In a global economy increasingly driven by talent and innovation, the Philippines cannot afford to be left behind.

Embracing LGBTQ+ inclusion can unlock the full potential of the Philippine economy, allowing all citizens to contribute to a future of shared prosperity.

References

• International Labour Organization (ILO). LGBTI People and Employment Discrimination in Asia.
• Open for Business. LGBTQ+ Discrimination in Southeast Asia.
• Williams Institute, UCLA. The Economic Impact of LGBTQ+ Inclusion.
• Philippine LGBT Chamber of Commerce. Survey on LGBTQ+ Professionals in the Philippines.
• World Bank. Inclusive Growth in Southeast Asia.