People's Domain

[Opinion] Jobless growth

The close of the academic year yielded new set of graduates that will require employment. The situation, however, is not getting better through the years. In fact, our country has an “employable” graduates last year that remain unemployed or under-employed until today.

In September 1993, unemployment rate was at 14.6 percent. The percentage rate momentarily decreased in September 1998 and September 2001 at 10.2 percent and 8.1 percent, respectively. By December 2008, it rebounded to double digit at 27.9 percent. November 2010 is at 23.5 percent; December 2011 at 24 percent; December 2012 at 24.6 percent.

In December 2013 the unemployment rate hit 27.5 percent. This is so far the highest in the period of 20-years.

The highest unemployment statistics delivered shock waves to the PNoy administration that no less than President Aquino III himself called a full cabinet meeting in order to discuss the state of unemployment in reference from the survey result conducted by Social Weather Station (SWS) for December 2013. President Aquino demanded explanation from his economic managers why the highest unemployment rate in spite of increasing Gross Domestic Product (GDP) and accelerating effort that propelled inclusive growth.

The survey result by SWS revealed that 27.5 percent of Filipino adults were jobless in December 2013 in spite of the 7.2 percent GDP. It also revealed that among the jobless adult, women is among the highest at 35.9 percent if compared to men which was 21.2 percent. Unemployment between ages 18-24 years old is likewise at its worst level.

In contrast, the government-led survey being undertaken by the National Statistics Office only manifested minimal unemployment at 6.5 percent within the same period. The discrepancy in terms of results puts the SWS survey in realistic terms and acceptable among Filipino workers.

Moreover, what makes the SWS survey apart from the NSO is the fact that it continue to include the unemployed categorized under “without work and looking for work”. The NSO likewise cover only the adult population from 18-years old and above while SWS maintained survey coverage from 15-years old and above.

In 2005, the same controversy emerged prompting the administration of then Gloria Arroyo to redefine the criteria. The change in definitions that NSO implemented significantly decreased the unemployment rate by 1.4-million. This is the reason why the NSO result remains in single digit while the SWS at double digit.

While debate ensued regarding the appropriateness of survey coverage, it did not change the fact that each year millions of Filipinos are registered as unemployed. It has worsen through the years as more and more graduates are entering the labor force. The steadily growing unemployment resulted in the emergence of the under-employed after graduates, desperate to find a job, apply for work which are defined in mismatched with the college courses that they completed. A good number of these workers are situated in call centers or get another work aside from being call center agents. Although the SWS did not cover this section, NSO data indicate that by October 2013 the number of the under-employed reached 6.8-million or 17.9-percent.

Economists refer to this phenomenon as ‘jobless growth’. Even Director Arsenio Balisacan of the National Economic Development Authority (NEDA) could not find adequate explanation to President Aquino III why unemployment continue to increase in spite of the seemingly positive indicators on the economic front. For Director Balisacan, the administration is on the right track. Admittedly, however, there is what he describes as “gap in social outcome”.

The physical evidence of investments are seen from the Infrastructures that are being constructed. It is assumed that from construction to commercial operation, these infrastructures are gathering employment every stage of the way. But it remains unsettled why in spite of a “physically’ moving economy as captured by GDP growth, unemployment is growing.

Is the growing population a case at point? Are opportunities for work have become limited with contractualization? Are the policies that government have adopted through the years improper and unresponsive to people’s needs? Maybe yes, maybe no. The solutions are complex.

But the glaring proof that growth is artificial is the fact that the growing economy is characterized by joblessness or jobless growth and that the growth that the Aquino administration is referring is not translated in improving the state of people’s lives or a growing gap in social outcome.

In a nutshell, Director Balisacan’s description points us to the Forbes list which can help indicate how disproportionate wealth is distributed in the country and who among the Filipinos have more opportunities to grow and who will continue to wallow in poverty.

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