No Comments 12 December 2010

By Pepper Marcelo

There was a time when many of the jobs Filipinos could land abroad were as maids, seamen and manual laborers. Over time, more and more of our skilled and trained workers have joined the exodus for higher wages and a better life.

Not too long ago, the mass exodus of nurses left local hospitals and the country’s health system in disarray, although the situation has been reversed in recent years (there is now an oversupply of nurses) as the global demand for medical workers slowed down. But the overseas demand for other occupations such as scientists, engineers, IT professionals, accountants and even teachers remains, tempered only in the past three years by the global financial crisis.

In the face of the unabated brain drain, one would think that Filipinos have come to accept the phenomenon as a fact of life, even a desirable one for many well-paid migrant workers. It took a triple whammy in August to revive the national debate on the seriousness of the problem.

First to shake the country was the news last August that 25 pilots of the Philippine Airlines have flown overseas, particularly the Middle East and Asia where they were offered nearly triple their salary at PAL. The mass resignation forced PAL to cancel a number of their flights.

A few weeks later, another mild tremor followed. The country’s weather bureau – the Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) – landed in the news for two related reasons. First, it failed to make an accurate forecast of an oncoming storm, earning a presidential reprimand. President Benigno Aquino III later fired the chief weather forecaster, Dr. Prisco Nilo, in the aftermath of Typhoon Basyang’s fury that left dozens dead. (Dr. Nilo opted for early retirement and left for Australia last Nov. 2.)

The second reason for PAG-ASA’s sudden notoriety was the announcement that the agency had lost 24 of its key personnel, many of them veteran weather forecasters, who had resigned to join the state weather agency of Dubai. The shortage of experienced personnel was one reason cited by the agency why bungled its job on ‘Basyang’.

The third whammy was the announcement by the Department of Environment and Natural Resources that 83 of its geologists had left for overseas work over the past three years, hindering government programs for mapping earthquake faults and mineral resources.

To be sure, government officials are fully aware of the negative impact of the OFW phenomenon on the local economy. After all, it has been the official policy of every administration since the 1970s to export labor as a means of easing the domestic unemployment situation and at the same time generate foreign exchange. Today, between nine to 10 million OFWs are toiling in nearly a hundred countries. They remitted US$17.3 billion in 2009, accounting for more than 10 percent of the country’s gross domestic product.

The brain drain syndrome has proved to be a tough nut to crack. While everyone agrees that the labor export policy should only be a stop-gap measure, there are no easy answers on how to minimize, if not stop, the brain drain.

Likewise, there seems to be no unanimity on how serious the problem is. Some are already pressing the panic button. But there are those who claim that there is really no “widespread brain drain,” but a general mismanagement by government of the working talent that we have.

“We have so many that have ‘brains,’ but they’re either unemployed or employed in the wrong industry,” says Loreto Soriano, executive director of the Federated Associations of Manpower Exporters (FAME), Inc. “It is not true that most of the OFWs are professionals and skilled workers. Pilots and forecasters are very small in numbers.”

Data from the Philippine Overseas Employment Administration (POEA) support Soriano’s contention. POEA statistics show that new or first-time OFWs during the last decade numbered about 300,000, with only 20% of them categorized as skilled, highly skilled and professionals. The rest are labeled as low-skilled and unskilled, including domestic helpers. “If we relate to the number of college/university graduates every year that averaged 900,000 during the last ten years, there is no brain drain,” argues Soriano.

According to the Commission on Higher Education (CHED), in 2007 there were more than 600,000 enrollees in Nursing, and more than 500,000 in Hotel and Restaurant Management (HRM) and Information Technology (IT), but only 40,000 were enrolled in Engineering and related disciplines.

The unabated mass production of nursing graduates has inevitably led to an oversupply of nurses. Today, there are more than 200,000 licensed nurses who cannot land overseas jobs either due to a soft demand or lack of the required hospital work experience. Local hospitals, which experienced a severe nurse shortage about five years ago, are turning down a long list of applicants, some of them willing to pay just to get experience.

“Thus, we see tens of thousands of nurses, engineers, HRM specialists, Information Technologists and teachers employed in call centers, Business Process Outsourcing (BPO), sprawling malls and food-chains like Jollibee, McDonald’s and Kentucky,” observes Soriano.

He blames skills mismatch as the culprit, pointing to the failure of the educational system to produce the right graduates needed by the labor market. He notes that despite a huge domestic workforce, thousands of jobs – mostly in technical and vocational fields – remain unfilled due to lack skilled personnel. As a result, a number of factories and light and heavy industries have closed down or moved overseas.

“Local industries during the past 30 years, they are gone. We practically do not have manufacturing, garment, leather goods, cannery and fabrication industries anymore,” laments Soriano.

In its place is the Service Sector, which provides more than half – almost 63% – of the nation’s entire economic output. But Soriano says, “This sector does not provide permanent employment, but only contractualization.” These lopsided contractual arrangements for the supply of workers have also become a factor for migration, says former labor undersecretary Susan Ople. “Contractual workers subsist on five-to-six-month job contracts while a legally deployed overseas Filipino worker has a guaranteed two-year contract with a fixed and higher salary,” she said.

According to Myrna Asuncion, an assistant director at the National Economic and Development Authority, the government has been seeking ways to upgrade salaries and benefits. “But local salaries can only go up by so much before they start hurting the competitiveness of local industries,” she told Agence France-Presse. “We want to provide employment opportunities in the Philippines but there are some sectors that say salaries are already too high.”

Soriano suggests that the government conduct a reality check of the present economic system. “Both government and private sector business must realize that our economy is sick with what I call the ‘Philippine Syndrome,’” he says. Also called the “Dutch Disease,” it results in a high remittance growth rate, leading to stronger peso and increased imports and government debt, which ultimately discourages domestic production, says Soriano. This must be tempered or stopped, he adds, otherwise we will have a “jobless growth-economy,” which encourages smuggling and promotes corruption.

Soriano says monetary authorities should review their policies, noting that a strong peso leads to a rise in cost of local products, which in turn lead consumers to opt for cheaper imported goods to the detriment of local businessmen and workers. He suggests a national economic policy that is balanced, inward-looking and nationalistic in order to support our basic manufacturing, agricultural, light and heavy industries. “That will provide permanent employment to our graduates, thereby creating a large pool of qualified workers for local and overseas jobs,” he says.




No Comments 10 October 2010

Without OFW remittances, it would be difficult for the Philippines to sustain the annual GDP growth of 7 percent or more. It is fortunate that the outlook for the earnings of OFWs remain bright, despite the very slow recovery of the developed countries. Thanks to their unique traits and talents, OFWs continue to be the first to be hired and the last to be fired in some 200 countries all over the world. READ FULL STORY




3 Comments 18 September 2010

Mabini, Batangas — Mediterranean-inspired, pastel-colored houses dot the coast and hills of this rural town in the Philippines, dwarfing their traditional counterparts made of unpainted concrete blocks under roofs of corrugated zinc. The larger houses, barely inhabited, many of them empty, belong to overseas workers who plan to return here one day. READ FULL STORY




No Comments 05 August 2010

The Philippines is suffering a crippling brain drain with many of its most talented and qualified workers heading overseas for higher-paid jobs and better lifestyles, employers say.

The shock resignations last week of 25 Philippine Airlines pilots, who left for bigger salaries abroad, highlighted a trend that is changing the stereotype of overseas Filipinos being simply maids, sailors and laborers.

Scientists, engineers, doctors, IT specialists, accountants and even teachers are among the English-speaking talent heading to foreign lands, leaving the government and private companies scrambling to find replacements.

“There is a skills haemorrhage. We are losing workers in the highly professional and skilled categories,” Vicente Leogardo, director-general of the Employers’ Confederation of the Philippines, told Agence France-Presse.

The pilots who quit for jobs in the Middle East and elsewhere in Asia would have in some cases nearly tripled their salaries, Airline Pilots Association of the Philippines president Elmer Pena told AFP.

“The salary here is a lot smaller than in other countries. You can’t really compare it,” he said.

Civil engineer Paris Chuchana joined the exodus two years ago when he moved his family to Singapore so he could take a job earning about US$1,600 a month, five times more than the maximum salary he could expect at home.

Like many expatriates, Chuchana enjoys the lifestyle outside his homeland, which suffers from pervasive corruption, poor infrastructure and frequent natural disasters.

“I was just on vacation, visiting my aunt here, but I found I liked it, so I resigned from my job in the Philippines and came over,” Chuchana told AFP by telephone from Singapore, adding he had no intention of returning home soon.

“My first kid is entering high school so I am already preparing for college.”

The nine million Filipinos who work overseas—about one tenth of the nation’s population—in both high and low-skilled sectors undoubtedly play a crucial role in propping up the nation’s spluttering economy.

Last year they sent home $17.3 billion to relatives or for investment, making up more than 10 percent of the nation’s gross domestic product, according to government data.

But Philippine Airlines’ recent woes have highlighted the costs.

The carrier said its hopes for turning a profit this financial year had sky-dived because the pilot walk-out had forced some flights to be cancelled.

Other organizations recently reported similar brain-drain pain.

The government weather station was heavily criticized last month after it failed to predict the full force of Typhoon Basyang (international codename: Conson) that killed dozens of people.

In its appeal for understanding, it said it did not have enough qualified meteorologists because 24 staff had gone abroad for better-paying jobs in recent years.

And just this week, the environment department announced it had lost 83 geologists to overseas work over the past three years, hampering government programs for mapping earthquake threats and mineral resources.

A Department of Labor study in 2008 found that despite a huge domestic workforce, many positions for skilled workers were going unfilled because there were not enough qualified applicants.

Amid this shortfall, 22 percent of the roughly 330,000 Filipinos who went abroad to work last year were technical, managerial or clerical workers, according to official data.

The government has been seeking ways to upgrade salaries and benefits, according to Myrna Asuncion, assistant director of the government’s economic planning department.

“But local salaries can only go up by so much before they start hurting the competitiveness of local industries,” Asuncion told AFP.

“We want to provide employment opportunities in the Philippines but there are some sectors that say salaries are already too high,” she said.

With no solution in sight, business groups hold little hope of keeping the nation’s top talent at home.

“You cannot stop these people from seeking greener pastures,” said Jesus Varela, a committee chairman with the Philippine Chamber of Commerce and Industry.

Midwife Chae Reviso returned to the Philippines after eight years working tax and rent-free in Saudi Arabia because she wanted to live again with her husband.

But barely a year later, the 39-year-old is preparing to leave again because her homeland offered her too few opportunities.

“I felt I owed my husband some time but I cannot afford to build a house on my salary in the Philippines,” Reviso said. (Agence France-Presse)




No Comments 10 July 2010

By F Sionil Jose

We have come to esteem our overseas workers as heroes and, indeed, they are. According to official statistics, they bring annually $14 billion or even as much as $20 billion. This vast sum sustains the economy; without it, this nation will collapse — its shopping malls will close, the profligate lifestyle of the rich will cease and thousands upon thousands will definitely starve. FULL STORY




No Comments 14 April 2010

By Joe Rivera

For Filipinos in the global diaspora, displacement came as an aftermath of the hardships brought about by the Second World War and worsening economic and political conditions in the country, particularly from the late 1960s to the present.

During the Marcos dictatorship in the 1970s and 1980s, Filipinos started leaving in droves. The discovery of the usefulness of overseas workers to the local economy prompted the government and the economic elite to encourage sending them abroad to keep the rotten system afloat.

As globalization facilitated the mobility of goods, services, information and ideas, it also engendered the movement of people, which soon became our primary export to the rest of the world. It has been estimated that there are about 11 million Filipinos overseas scattered in every country in the world, or almost 12 percent of the total population of the Philippines. FULL STORY




No Comments 22 March 2010

They may have brought home the bacon – $17 billion in 2009 or over 10 times bigger than last year’s expected foreign direct investment – but more than an economic force, overseas Filipino workers (OFWs) have evolved into a social phenomenon that the country’s next president needs to resolve decisively.

The Filipino diaspora has fostered a “culture of migration,” Professor Mary Lou Alcid of the University of the Philippines’ College of Social Work and Community Development said in a campus forum last February. This has resulted, she noted, in “transnational Filipino families” with the father in Saudi Arabia, the mother in Hong Kong, the daughter in Taiwan, the brother in Dubai, and the youngest left in the Philippines.

In the May elections, migration experts believe that voters should pick a candidate who can resolve the problem of large-scale labor deployment abroad which results in the break-up of families, abuse of OFWs, the spread of infectious diseases, and other ills.

However, about a month before the polls, migrant groups say no candidate has come up with specific strategies to address these problems. FULL STORY.




2 Comments 17 March 2010

On the 15th death anniversary of Flor Contemplacion, repatriated overseas Filipino workers (OFW) marched to historic Mendiola in Manila to call for an end to government policies which they said continue to undermine migrant workers’ rights and welfare.

Garry Martinez, chair of the migrants’ rights group Migrante International, said that 15 years after the nation was galvanized into protest by the unjust hanging of Contemplacion in Singapore, the plight of OFWs has turned for the worse. “Appalling stories of abuse in foreign lands and the government’s neglectful response” have become everyday stories, he added. FULL STORY.




3 Comments 11 March 2010

By Pepper Marcelo

The Philippine Overseas Employment sector is at a crossroads. For decades, the country has relied on remittances to fuel the local economy and its domestic consumption. Now it faces rough sailing as labor demand from overseas slows down as a result of the global financial crisis.

No other country has had as much an over-reliance on remittances as the Philippines. Compared to other top recipient countries such as India, China and Mexico, the high percentage of remittances to the national income, or GDP, is highly disproportionate.

For example, the ratio of remittances (in billions of dollars) to the GDP of India is 27-to-3, China 27.5-to-1, and Mexico 25-to-2.8. The Philippines, on the other hand, is 17-to-13.8.

The country’s economic survival is dependent on sustaining these OFW remittances. With the current global financial crisis effecting migrant workers, however, the OFW sector faces an accelerating number of complex challenges going into the new decade and beyond.

Europe, North America and Asia are in a recession of unknown duration and depth. Job orders from Australia, New Zealand, and Canada, previously considered the best countries for expatriates, have stopped.

Only Middle East countries of Saudi Arabia, UAE, Qatar, and Libya are hiring workers, using government and sovereign funds that sustain much of their current infrastructure projects and OFW manpower demand.

“To them, the Middle East is a difficult place. There’s no freedom there,” says Loreto Soriano, executive director of the Federated Association of Manpower Exporters (FAME). “The point I want to clarify, is that in those first world countries that the Filipino would normally want to go, they are the first to be affected by the crisis. You have to be practical. If you’re looking for a job and want to earn, that’s the place.”

Soriano is an Overseas Contract Worker (OCW) himself, having experienced personal economic benefits (as well as family sacrifice) while stationed in Saudi Arabia in the 80’s. Over the last two decades he has become involved in the migration of workers, and has been advocating the design of OFW components that would be beneficial to OFWs and the nation.

Dutch disease

To him, remittances are causing a “Dutch Disease.” “It is a phenomena in which you are awash with wealth but spend it unwisely.”

The concept is based on the impact of the high remittance growth rate in many sectors of the economy, including appreciating the peso, increasing foreign imports and discouraging domestic production, increasing government debt, encouraging smuggling and allowing for the growth of corruption.

“For example, before, to sustain the wealth of your family, you had a farm, a piggery or small poultry. This is the source of income that provided education to your kids. If you have a daughter in Japan or Saudi earning overseas and sending home money, you don’t need to sustain that farm.”

On a larger scale, “Dutch Disease” is the detrimental outcome of a country’s foreign exchange income without the government’s cost of development and investment.

Erroneous data

The financial sector and government agencies have propagated the falsehood that the last few years’ remittance record increases have been driven by a large increasing group of OFWs working in “recession-proof” occupations.

In fact, professional deployments have declined by 45% from 2005-2007, and less than 5% of all OFWs should be considered working in recession-proof positions, such as healthcare, 70% of whom are employed in Saudi Arabia.

There is a fundamental flaw to the collection and processing of OFW deployment and hiring data. Deployment statistics reflect multiple counting, while job classifications are too few, outmoded, and not sufficiently detailed. Financially, authorities have been aware of OFW statistical inconsistencies and deficiencies for years. Most statistical claims are believed but “upwardly biased.”

Many officials say there is record growth, but it is attributable to change in mode of transfer rather than increased deployments of professionals with increased salaries.

These statistics reflect different channels of delivery – from banking to non-banking, or non-informal channels such as couriers, hand carry and padala transfer methods.

“If there is growth, why can’t poor people feel it? Because it is a jobless growth. From a productive economy, it has changed into a consumptive economy. Because of the inflow of dollars, and industries are dying, there is so much consuming by the families of OFWs. And if there in nothing to buy locally, we import everything we need.”

And contrary to popular belief that OFWS are employed in recession-proof industries and a high percentage of them are professionals, they are not. Though it is stated that 90% of the OFW workforce is composed of professionals, the number is closer to 13%, and that is steadily declining.

The fact is that OFW deployment is dominated by low-skilled workers, encompassing household, service, factory and labor. The deployment of professionals – nurses, doctors, etc. – remains low compared with other skills categories. In the supposedly “recession-proof” healthcare industry, only approximately 3% of nurses were new hires in 2007, down 36% from their peak of 9,000 in 2001.

It is also believed that hundreds of thousands of nurses are deployed each year, when in reality, it is less than 10,000. And that many of them go to the U.S., but actually only 186 went in 2007.

Unemployable graduates

“That kind of dialogue – that tens of thousands of nurses are deployed since 2003 – invited half a million enrollees in nursing for the past six years,” Soriano says. “That’s why you have computer schools like AMA and STI and Mapua Institute of Technology (MIT), companies that are dedicated to IT and engineering, opening nursing courses.”

The Philippines is producing unemployable candidates and qualified graduates for most job orders, yet nationwide specialty “schools” and programs keep proliferating, ignoring the job market reality.

For many years, the Overseas Employment Service Providers (OESP) has voiced their concerns on the incompatibility of college, technical and vocation courses with international standards.

Unfilled job vacancies, approximately 500,000 according to the POEA, were not filled due to the lack of experienced, qualified professionals and skilled workers. There are 389,000 job orders, but only 25% can be filled in the next 6 months.

Increased competition and lack of experienced, qualified applicants will continue to increase and accelerate. There is also a lack of permanent jobs for gainful experience, with manufacturing industries that offer permanent jobs quickly dwindling.

“Can we change that? No, unless there are structural changes.” One of his solutions is that returned and “retired” OFWs should be treated as productive assets and become part of a new economic model that utilizes their experience, knowledge and available investment funds by working under sustainable domestic programs. This includes agriculture and community-based commerce.

Failure to act now, Soriano says, to protect and sustain the OFW economic engine will cause great political and social uncertainty in the country and affect the capacity to be a regional player in the future.

“Our economists and government policy makers should realize this. The effect of their failure to protect the local economy is now affecting the overseas employee.”




3 Comments 02 February 2010

By Perla Aragon Choudhury

The money sent home by overseas Filipino sailors rose by $108 million to a new record of $2.501 billion in the first nine months of 2009, an increase of or 4.51 percent from $2.393 billion over the same period in 2008, according to the Trade Union Congress of the Philippines (TUCP).

TUCP secretary general and former Senator Ernesto Herrera said the rise in remittances from sea-based migrant Filipino workers is due to increased enlistment by ship owners in Europe and Asia.

“A growing number of European and Asian shipping firms is disbanding their multinational crews, and replacing them wholesale with all-Filipino personnel that are younger and more able,” says Herrera.

“Foreign employers find Filipino sailors quick learners, and easier to train compared to other nationals. This may be due to their superior instruction here, apart from their ability to understand English,” he adds.

About 229,000 Filipino sailors are on board merchant shipping vessels around the world at any given time, data from the Department of Labor and Employment show.

The Philippine Overseas Employment Administration (POEA) reports that in 2007 – the year for which the most recent data are available – Filipino seafarers were employed by 1,157 registered/accredited manning agencies, up from 869 in 2006.

The Philippines, says POEA, has been the world’s leading supplier of seafarers since 1987, making it the manning capital of the world.

Overseas assignments

Data in 2007 showed that Filipino seamen were scattered aboard vessels bearing various flags of registry: Panama – 51,614; Bahamas – 29,681; Liberia – 21,966; Singapore – 10,308; Marshall Islands – 9, 772; United Kingdom – 8,172 ; Malta – 7,513; Cyprus – 7, 052; the Netherlands – 7,017; and Norway – 6, 975.

By vessel type, here are the 2007 statistics on Filipino seamen: passenger-type – 47, 782; bulk carriers – 42, 356; containers – 31, 983; tankers – 25,011; oil/product tankers – 14, 462;   general cargo ships – 10,754.;  chemical tankers – 7,502 ; tugboats – 6,610;  pure car carriers – 5,742; and gas tankers – 3,471.

By type of work, the 226,900 local seafarers deployed overseas in 2007 were assigned as follows: seamen – 31,818; oilers – 19,491; ordinary semen – 17,355; mess men – 7,810; chief cooks – 7,778; bosuns – 7,737; third engineers – 7,056; third mates – 6,599; and waiters – 6,388.

Global crisis

In late 2008, even as the global financial crisis was wreaking havoc on virtually every major economic sector, the manning industry suffered minimal setback in terms of job losses.

“The bulk of the seafaring industry is not as affected as people might think,” says Miguel Angel Rocha, vice-president for business development of CF Sharp Crew Management, Inc., one of the country’s leading manning companies. His firm is now the major business of CCF Sharp, a port agency business began in the late 1930s by his grandfather and business partner CF Sharp. It is also the first Filipino manning company to be certified as compliant with ISO 9000 Standards.

“The manning industry is a trailing indicator,” Rocha tells Planet Philippines in an interview. “Only after an event will it be affected. Lately, ships had been 15% laid up, or out of service, and by 2009 the figure was 30%. But jobs were not lost because of the `hot’ or `warm’ nature of the industry – a ship always needs engineers and crew to operate, maintain and mobilize it.

“Chinese factories stopped ordering raw materials and so bulk ships were the first to get affected. By November 2008 there was a decrease in daily chartering from $180, 0000 per day to $3,000-5,000 per day in September. After Christmas [of 2008] and New Year [of 2009], there were no more orders and container ships were down. We don’t see a significant loss of jobs but we do see slower growth.”


Rocha is optimistically guarded about the prospects in 2010.

“Even if the global economy gets better, it will take a long time before we see a recovery in our industry,” he stresses.

He warns that if the market worsens, jobs will be harder to find.

“Also, seafarers now working might have to work less and stay on vacation longer. There is no growth as ship owners try to maintain their pace of work where they have 15 persons on board for the 10 actually needed.”

But then, Rocha explains, the shipping industry is cyclical. “A new ship means new crew in boom times. Now this is going to change and so they’re laying vessels but not selling them for scrap, and giving the crew  longer shore leave. But then again, things might turn around and it will be boom time again.”

Poaching of officers

Rocha is actually more concerned about the poaching of senior officers, from master officers and chief mates to chief and second engineers, which could have a more dramatic impact on the industry.

The global shortage of officers is oftentimes remedied by a greater-rotation-cum-shorter-vacation solution. The problem is only a recent development, according to Rocha. Officers and ratings used to be available, mostly from the West.

“But as more ships were built in the ‘90s and today, as the economy of the West expands, British, German and Norwegian officers can earn as much or even more on land. They have left and have been replaced by officers from Poland and Ukraine.”

The vacuum could have been filled up by the local manning industry but unfortunately, there are not enough Filipinos with the required skills and training.

Lack of training

“There are 80 to 100 maritime schools offering BS Marine Transportation and BS Marine Engineering courses with a curriculum of three years in the classroom and 12 months on board a ship prior to state board exams, but less than 20 percent of the students get on board,” he laments.

Rocha cites two top maritime schools in the Philippines where slightly under 15% of the most recent graduating class have trained on a ship. Their graduates got certificates of academic equivalency but they are not on board because the majority of ship owners do not make a provision for cadets on board, who would also have to be paid.

“The problem is no one is willing to challenge ship owners,” he continues. “Some 280,000 students graduate each year. That seems a lot of seamen who could get a higher income for their families. But people don’t see the uphill battle in getting the license, and educators prey on seamen. Going abroad is not always pleasant experience and can be very daunting.”

But Rocha notes that there is a bit of positive news on the horizon as ship owners have lately invested in training. For one, the Norwegian Shipowners Association has a program for cadets.

But without support from POEA and the Commission for Higher Education (CHED), Rocha fears that maritime schools might not participate or offer enough slots in the training and development of seafarers.

It remains to be seen if the government and the manning industry could come up with policies and measures to address the problems and challenges. Unless there is a serious effort to meet them head-on, less and less Filipino seafarers may find their way into the open seas.


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