Lack of jobs, low income belie economic growth, workers say

"The labor market turned in a dismal performance in January despite unexpectedly strong economic growth in the last quarter of 2005," according to Clarence Pascual, Senior Researcher of Labor Education and Research Network (LEARN).

Employment expanded by 750,000 from its year-ago level, according to the January round of the Labor Force Survey (LFS) conducted by the National Statistics Office (NSO), way below the government's target of 1.5 million a year.

According to Pascual, unemployment, using the old official definition, fell to 10.7% in January from 11.3% a year ago. He said using the new definition gives an unemployment rate of 8%, but there is no comparable year-ago figure.

The government began using the new definition in April 2005. The number of unemployed workers, using the old definition, was at 3.9 million.

Poor quality of jobs

"The concentration of employment gains in low-productivity and low-pay sectors such as agriculture and private households indicates poor quality of job creation," said Danny Edralin, Chair of the Alliance of Progressive Labor.

The NSO's Labor Force Survey reported the agriculture sector added the biggest number at 475,000 jobs, followed by private households which contributed 102,000 net new jobs. By contrast, the industrial sector posted a net job loss of 95,000, with construction shedding 73,000 jobs and manufacturing losing some 18,000 jobs.

"The government's publicity machinery claimed success in employment generation but deliberately evaded the fact that part-time jobs account for the bulk of new jobs created," said Edralin.

The NSO reported that part-time jobs increased by 651,000, posting the bulk of new jobs. Unpaid family workers posted an increase of 389,000 or 52% of net job creation. The number of own-account workers rose by 263,000.

Jobs deficit

According to Pascual, net job creation in the first quarter of this year falls short of the government's target of 1.5 million jobs per annum, which is what is needed to bring down joblessness.

The surge in underemployment that became evident in 2005 carried over in January this year. Underemployment reached 6.9 million at the start of this year, an increase of 1.8 million in the last 12 months.

"In sum, over 10 million Filipinos, out of a 36-million workforce, are looking for work. This does not include men and women who leave the labor force in the absence of clear job projects. Clearly, the government faces a jobs deficit of crisis proportions," said Pascual.

Labor left behind

"The current jobs crisis has been festering in the last seven years as labor has been left behind in the current growth cycle," said Edralin.

According to Pascual, unemployment increased along with GDP growth.

Government data revealed unemployment went on to a high 11.8% in 2004 easing slightly to 11.3% last year. GDP growth accelerated from 3.3% in 1999 to a high of 6.1% in 2004 only to decelerate to 5.1% in 2005.

"The flipside of rising unemployment and GDP growth is improving labor productivity. Indeed, labor productivity has been rising since the mid 1990s in contrast to the trend in the 1980s and early 1990s," said Pascual.

According to Edralin, rising labor productivity has not translated into higher wages and family incomes because of soaring unemployment.

The overall index of compensation in establishments with 10 or more workers has been flat in the last 10 years. The index for the manufacturing sector shows a steep drop during the same period. The latest data also show that average family income in real terms shrunk by 14% between 1997 and 2003 despite the steady rise in productivity.

"Labor is condemned to lurch from one crisis to the next," said Edralin.