Philippine labor

Rise of low-quality jobs reflects pandemic scars in PH labor market

Ralf Rivas
Rise of low-quality jobs reflects pandemic scars in PH labor market

SUBSIDY QUEUE. People line up to receive cash aid in Manila.

Photo by Jire Carreon/Rappler

The government says there are now more Filipinos with jobs amid the pandemic. But these people are self-employed and in the informal sector.

President Rodrigo Duterte’s economic team has asserted on several occasions that jobs have returned to pre-pandemic levels.

As of February 2021, overall employment stood at 43.2 million, translating to 1.9 million more Filipinos with jobs compared to January 2021.

“This means we have surpassed our pre-pandemic employment level of 42.6 million in January 2020,” the economic managers said last March.

But what type of jobs are these, exactly?

In a media briefing on Wednesday, April 28, Asian Development Bank (ADB) Country Director for the Philippines Kelly Bird emphasized that these jobs are of low quality.

There are now more self-employed individuals and people in the informal sector, and this type of employment is deemed to be less stable.

“The concern for us is that the employment that’s being generated is in the informal sector. It’s those who are working self-employed. These are generally the less stable employment activities. Their incomes are not always stable. They are not always covered by the social system,” Bird said.

“And that’s the concern: that lower-quality jobs are being created, and not the quality jobs.”

While there are more Filipinos who reported that they had a job last February, unemployment rose to 8.8% from the 8.7% in January. 

This is due to the increase in labor force participation, which went up from 45.2 million people in January to 47.3 million in February. The labor force includes individuals who are either employed or unemployed.

‘Hysteresis’

In a report published on Wednesday, the ADB noted that the Philippines risks falling into a phenomenon called hysteresis, where unemployment continues to rise even after the economy has started to grow again.

The ADB noted that hysteresis can “indicate a permanent change in the workforce from the loss of job skills, making workers less employable even after a recession has ended.” (READ: ADB sees fragile economic recovery for Philippines)

The report also noted that one-third of the country’s total workforce is in “vulnerable employment,” and this could further swell due to the shift from wage and salary employment to self-employment due to the pandemic.

The pandemic has wiped out 1.7 million wage and salary jobs in private establishments, while self-employment rose to about 435,000.

Solutions

Bird said the government can build on existing projects and institutions to bring back quality jobs.

He noted that wage subsidies for target sectors and skills training would help workers transition to newly available jobs due to the pandemic.

Bird also cited accomplishments in countries like Ireland, where enterprises receive skills training grants.

“Perhaps we’re looking at ways to strengthen and improve on the apprenticeship program here, so that we can increase the uptake of apprentices in the country, and that will be critically important to be able for them to develop relevant market skills,” Bird said. – Rappler.com

Ralf Rivas

A sociologist by heart, a journalist by profession. Ralf is Rappler's business reporter, covering macroeconomy, government finance, companies, and agriculture.