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‘Lack of decent jobs worsens poverty’

Socioeconomic Planning Secretary Arsenio Balisacan says unemployment in the past few years was at or above 7%, causing poverty to persist

POVERTY. The Philippines has struggled with poverty mainly because of the lack of decent jobs, says Socioeconomic Planning Secretary Arsenio Balisacan. Photo by AFP

MANILA, Philippines – Poverty persists in the Philippines due to lack of good jobs, according to the National Economic and Development Authority (NEDA). 

In his presentation before the Management Association of the Philippines, Socioeconomic Planning Secretary Arsenio Balisacan said unemployment in the past few years was at or above 7%.

He said between 2010 and 2012, the economy created only 1.59 million jobs. In 2012, there were 37.6 million employed Filipinos, slightly higher than 36 million in 2010. 

“At the heart of the poverty problem is the inadequacy of jobs, especially decent, high-quality jobs. Although job creation between 2010 and 2012 was significant, the level of unemployment [remains] quite high — 7.4% in 2010 and 7% in 2012,” he said. 

Balisacan said this happened as more than 60% of the country’s economic growth was concentrated in 3 regions in Luzon – the National Capital Region (NCR), Region 3 or Central Luzon, and Region 4-A or Calabarzon. 

The NEDA chief tracked the country’s economic growth in 2009, 2010, and 2011. He said Luzon’s share in gross domestic product (GDP) increased to 62.4% in 2011 from 61.7% in 2009.

This was opposite the trend in Mindanao. Mindanao’s GDP share declined to 10.8% in 2011 from 11.2% in 2009. Visayas’ share remained below 13% in the 3-year period. 

“This shows that we have yet to tap the full potential of other regions, especially those in Mindanao,” Balisacan said. 

Where the jobs are

Asian Development Bank (ADB) Philippines Senior Economist Norio Usui said Filipinos do not need just jobs, but high-paying, productive jobs.

TOP EXPORT. The Philippines' top export is electronics but ADB Senior Economist Norio Usui believes the country still has a long way to go to maximize this sector. Photo by AFP

Usui said while business process outsourcing (BPO) firms offer great employment opportunities for Filipinos, these are limited to high-skilled workers and have low levels of productivity. He said the Philippines must develop industry, particularly manufacturing, to create productive jobs for moderate and low-skilled workers.

He said government must also focus on commodities whose production are highly labor-intensive. These include:

  1. Synthetic or reconstructed precious or semi-precious stones
  2. Pianos, other string musical instruments
  3. Knitted, not elastic nor rubberized, of fibres other than synthetic 
  4. Pens, pencils and, fountain pens
  5. Small-wares and toilet articles; sieves; tailors’ dummies
  6. Fabrics, woven, of continuous synthetic textile materials
  7. Clocks, clock movements and parts
  8. Precious jewellery, goldsmiths’ or silversmiths’ wares
  9. Watches, watch movements and case
  10. Porcelain or china house ware
  11. Photographic cameras, flashlight apparatus, parts, accessories
  12. Fish, dried, salted or in brine; smoked fish
  13. Fish fillets, frozen
  14. Sewing machines, furniture, needles etc, and parts thereof
  15. Complete digital data processing machines
  16. Electrical line telephonic and telegraphic apparatus
  17. Television, radio-broadcasting; transmitters, etc
  18. Flours and meals, of meat, fish,etc, unfit for human; greaves
  19. Microphones; loud-speakers; audio-frequency electric amplifiers 
  20. Portable radio receivers

Usui said the government and business sector could come up with good incentives or subsidies to help get manufacturing back to its feet.

He added that addressing the basics like infrastructure constraints will go a long way in encouraging investments in the country. Usui said high power rates are one of the biggest issues that “turn off” foreign businesses.

Usui said foreign investments are now flowing into the Philippines mainly because of rising labor costs in countries like Thailand, China, and Vietnam. However, these are still much smaller than what neighbors’ have.

“Opportunities are open to the Philippines. Some big players are already coming. But chances are open to all emerging countries,” Usui said. – Rappler.com

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