Jobs remain a major concern despite modest growth

DESPITE having evaded a recession, the Philippine labor market turned for the worse in 2009.

While the government’s Comprehensive Livelihood and Emergency Employment Program managed to provide jobs, these were not only inadequate, but also temporary employment with little value-added. An Asian Development Bank study showed that the country lost an estimated 950,000 jobs from the fourth quarter of 2008 to the first quarter of 2009 because of the crisis.

The Department of Labor and Employment said that about 109,529 workers were affected by the financial crisis between October 2008 and March 16, 2009.

By October 2009, the unemployment rate hit 7.1 percent from 6.8 percent in the same period in 2008.

In absolute numbers, there were 2.719 million jobless Filipinos, up by 191,000 from 2.525 million the previous year, according to the National Statistics Office.

This as the Philippines bore the brunt of the global slump, with economic growth crawling to 0.7 percent in the first three quarters, or below the low-end of the full-year official goal.

But the global crisis only accentuated what the National Economic and Development Authority (NEDA) called a “major concern.”

In its own study, NEDA said employment growth lagged behind economic growth even before the global financial crisis struck.

From 2005 to 2008, the NEDA said the country’s gross domestic product (GDP) grew at an annual average of 5.5 percent, much higher than the average employment growth of only 2.2 percent.

In 2008 alone, the economy grew by 4.6 percent, but employment rose by only 1.6 percent.

Bert Hofman, World Bank country director, said the Philippines’ economic growth does not really provide sufficient jobs and income for the poor, adding that the growth mainly comes from high-end services and the manufacturing sector.

He said business process outsourcing (BPO) mainly attracts university graduates, adding that “it doesn’t do a lot for the poor who usually lack of education.”

The same trend of growth outpacing job-creating is evident in agriculture, which accounts for a fifth of GDP.

With weak employment creation, higher prices and population increases in 2004 to 2006, the incidence of poor families in the Philippines increased by 2.5 percentage points to 26.9 percent in 2006 from 24.4 percent in 2003.

Economists project that the employment outlook would remain gloomy because of the recent typhoons and weak external trade.

But NEDA Director General Augusto Santos is confident that the government can achieve its target of creating 1 million to 1.5 million jobs in 2010.

“Despite the economic crisis, the government still managed to create employment. Except that, probably because of population growth, the economy wasn’t able to absorb everybody,” he said.

Santos said the number of jobs that will be created in 2010 will be equal to the new entrants in the labor force, which is estimated at about 1.4 million. –DARWIN G. AMOJELAR, Manila Times