Quality of work remains a problem despite expansion in jobs, economists say

by Danica M. Uy, Businessworld, Jan, 17, 2017

THE GOVERNMENT needs to address the quality of jobs available to workers despite the greater availability of work, economists said.

On average, underemployment in the Philippines since 2010 has remained steady, with the recent high at 19.3% in 2013. In October 2016 underemployment was 18.0%, rising from 17.3% in July, according to Philippine Statistics Authority (PSA) data.

“Underemployment remains a big challenge,” Ateneo de Manila Economics Professor Alvin S. Ang said.

While there has been an improvement in employment since 2010, the government continues to struggle with improving the quality of jobs, he said.

Underemployment happens when employed persons are still searching for additional work or are working more than one job in order to make ends meet.

“It is a very big challenge, quality of employment. There’s no doubt the level of employment increased, but there’s still a lot of work to be done in order to achieve a higher level of development so that we can create more and better jobs for as many people for them to get decent jobs,” said Rene E. Ofreneo, director of the University of the Philippines School of Labor and Industrial Relations (UP-SOLAIR) in a phone interview.

Employment averaged 94.5% in 2016, compared with 93.7% recorded in 2015, according to the PSA’s Labor Force Statistics report from January.

Meanwhile, unemployment fell to 5.5% in 2016 from 6.3% in 2015.

According to Mr. Ofreneo, one of the problems the government will have to address is the illegal practice of contractualization, which is also known as “endo.”

“Endo, interns forever, probationary employees forever,” said Mr. Ofreneo, citing the various arrangements resorted to which deny workers a path to permanent status.

While the government’s infrastructure development plan is expected to increase employment, it does not automatically translate to lower underemployment.

“Infrastructure is a job creator, but it can also deepen inequality if it’s always public-private partnership (PPP) deals focusing only on big companies. In infrastructure, the government must not only take into account the proposals of large corporations, but also address the needs of surrounding communities,” said Mr. Ofreneo, adding that rebuilding communities will also create jobs for the poor.

However, the rate of underemployment is expected to fall during President Rodrigo R. Duterte’s term due to expectations of robust economic growth in the next few years.

“The trend in underemployment is downward, and given the fast growth I expect for the Duterte administration, I expect also a continuing fall in underemployment,” said University of Asia and the Pacific (UA&P) Associate Professor Victor A. Abola in an e-mail interview.

The quality of employment will naturally improve once the government is able to better manage unemployment.

“I think before we start worrying about quality, we should think first about quantity. The quality will come as we reduce the ranks of unemployed and underemployed,” said Mr. Abola.

But according to Mr. Ofreneo, the government must attend to the national interest by investing in education and skills development as well as scaling up existing industries and micro, small and medium enterprises (MSMEs).

“Overall, you have to address on the supply and demand side. The supply side, you invest in education, skills, etc. But on the demand side, you have to address the upgrading and improving of industry, agriculture, in particular the MSMEs,” said Mr. Ofreneo, underlining the agricultural sector as the area that needs the most attention.

“Suffice it to say that current plans to focus on rural employment may solve some (problems in underemployment) but capacity building takes time,” said Mr. Ang. —