Upbeat labor performance boosts economic outlook – NEDA chief

Socioeconomic Planning Secretary Cayetano W. Paderanga Jr. on Thursday said the labor sector’s upbeat performance last year helped boost the economic outlook for 2012.

“The improved performance of the labor market in 2011 bolsters the optimism for a better economy this year,” National Economic and Development Authority (NEDA) director-general said in a statement.

“Last year, the country generated more employment from the previous year. Employment level rose by 3.2 percent or 1.156 million,” Paderanga noted, quoting from the quarterly Labor Force Survey report of the National Statistics Office.

He cited “the strength of the continued growth in services and the recovery in agriculture, although there was a slowdown in the industry sector…” for the sector’s performance.

Labor expert Jorge Sibal, former dean at the University of the Philippines-School of Labor and Industrial Relations, based the optimism on several factors starting with release of funds for infrastructure development.

“The reason for optimism this year is that the government allotted several billions [of pesos] on infrastructure through public-private partnership. This year the government encourages the private sector to co-invest with them, which in effect will create jobs,” Sibal told GMA News Online in an interview.

However, he traced the slower job creation in the industry on global developments that weakened demand for electronic products.

“The continuous recession in the United States and in Europe lowers the demand for exports on the electronic products, hence, job creation decline or does not expand,” he said.

Still, Sibal noted some industries on a positive note including tourism and business process outsourcing which can also be categorized under services.

The informal sector

Paderanga raised the issue of the informal sector.

“Sa Pilipinas, maraming trabaho na ordinarily in developed countries would not be thought of as work. Our problem, however, is that many of the employed are working in the informal sector, where the income levels are really quite low. We would like to produce more work in the formal sector,” Paderanga said.

Those working in the informal sector account for almost half of the labor force, according to government.

Paderanga explained that informal sector workers include the unpaid family workers and own-account workers mostly involved in merchandising.

“With the decline in full time employment, many workers are forced to move in the informal sector,” Sibal said.

Concerns about underemployment

The economic chief also raised his concerns about underemployment, which rose to 19.3 percent last year from 18.8 percent in 2010.

“In the Philippines, many of those already employed are finding themselves in jobs that they probably are not satisfied with. Marami ang fully employed, pero mababa ang sahod,” he said.

“High underemployment rate is an indicator that per capita income is low,” he added.

Underemployed workers are persons 15-years old and over, who are employed but want to have additional hours of work in their present job or an additional job, or to have a new job with longer working hours.

Paderanga earlier told reporters that government spending will shore up the Philippine economy this year. — VS, GMA News