MANILA, Philippines: As the world grappled with the uncertainty of the COVID-19 pandemic, families everywhere faced the challenge of surviving financially amidst prolonged lockdowns and restricted movements.
In the Philippines, the pandemic altered the way Filipino households spend, with food and essentials becoming the primary focus of family budgets. A recent survey conducted by the Bangko Sentral ng Pilipinas (BSP) published by Business Inquirer sheds light on how Filipino families navigated their finances during the crisis.
Food-dominated household expenditures
The findings from the BSP’s Consumer Finance Survey (CFS), which surveyed 16,212 households in 2021, revealed that Filipino households spent an average of P19,242 (S$447.32) per month, or approximately P230,905 annually, to meet their needs. Notably, food emerged as the largest expenditure, accounting for 57.2% of total household spending. This trend is in line with previous surveys, but the pandemic accentuated this focus on food.
The shift in consumption patterns was evident, with an average of P9,955 spent monthly on home-prepared meals, which now made up 55.4% of the total household budget. This figure marked an increase from 2017, when it accounted for 49.9%. The move towards eating at home was driven by government-imposed restrictions on dining out, prompting many Filipino families to prioritize home-cooked meals over restaurant dining. Spending at restaurants was minimal in 2021, averaging just P486 per month or 1.9% of the overall budget.
Housing, utilities, and transportation—Essential but less prioritized
While food took the lion’s share of household budgets, other essential categories also saw significant spending. Housing and utilities represented 10.6% of total expenditures, amounting to P2,061 per month. This was notably lower than the 23.9% share recorded in 2017. The BSP attributes this reduction to factors such as the departure of offshore gaming operators and the return of some workers and students to their home provinces, reducing demand for rental spaces and utilities in urban areas.
Transportation was the next largest category, with Filipino families allocating 7.2% of their budget, or P1,798 monthly, to commuting and travel. Despite lockdowns and restrictions, mobility remained a necessary expenditure, highlighting the importance of government price management in maintaining access to affordable transportation.
Shifting priorities for non-essential spending
Non-essential spending saw a notable decline during the pandemic. Filipino households spent only 8.6% of their budget on items such as alcohol, tobacco, and entertainment. However, within this category, personal care, celebrations, and gifts still accounted for a significant share, with miscellaneous expenses alone making up 4.8% of the total expenditure.
The pandemic reshaped how Filipino families allocated their finances, with spending on luxuries and non-essentials taking a backseat to more pressing needs. As the country slowly emerged from the health crisis, these trends could serve as valuable insights into how Filipino households may approach financial planning in the future.
This survey also highlights the resilience and adaptability of Filipino families, underscoring their ability to prioritize essentials while adjusting to the financial pressures imposed by the pandemic. The findings offer a glimpse into the lasting changes in consumer behaviour, pointing to the critical role of government support and price management in ensuring that families can navigate uncertain economic conditions.