Holiday Economics                                                            

Late in 2001, Arroyo implemented her new policy which would later be called as "Holiday Economics". Under this policy, the government will adjust holidays to form longer weekends (Example: If June 12 — Philippine Independence Day — is a Wednesday, the holiday will be moved to a Friday or a Monday to connect with the weekend) and promote local tourism. The policy went into full force since 2002 although critics claimed that it unnecessarily breaks certain traditions (Example: Labor Day must only be celebrated on May 1). Businessmen often complained that the government was always too slow and too late to announce when the holidays will take effect. To this day, people demand that a full year schedule of holidays be released.

Arroyo stressed the following as the main purposes of the Holiday Economics policy:

1. To enable Filipinos to spend more time with their family.

2. To strengthen the Philippine economy by promoting domestic travel and tourism

In late August 2005, businesses and the general public found themselves victims of a "holiday ambush" as the Arroyo administration declared a sudden holiday with August 29 (in celebration of national heroes). As late as August 26 (Friday), press secretary Ignacio Bunye clarified that no holiday will be declared, only to retract less than 24 hours later. That same weekend, the holiday was declared as a working holiday.

When August 29 arrived, people were surprised to see some businesses closed as well as all government offices shut down. As a result, lawyers, labor unions and business leaders organized their own private meetings or gatherings and appealed to Arroyo to put an end to her Holiday Economics policy, which they claimed was more harmful than good.

Some believed that the administration declared August 29 as a rushed holiday out of panic due to the fact that Congress was all set to debate and vote on the then pending impeachment case against Arroyo, which happened on September 5 and 6.

While Arroyo did not declare an expected 8-day holiday in December 2005 (December 26 and 30 were holidays but December 27, 28 and 29 were work days), many critics pointed at the Holiday Economics strategy as the main culprit behind the decline of the holiday retail sales all over the country. Retailers around the Philippines reported a 15% fall in their December 2005 sales compared to December 2004. Analysts stressed that because of numerous holidays declared throughout 2005, people who went on holiday spent too much on tourism and had not much money left for the holiday season.