There were a lot of Labor Day drama from various sectors, but no one focused on how to create more jobs. Indeed, a recent survey revealed there is more unemployment these days.
The labor unions are only interested in getting as much benefits as they can for their members. They want salaries to increase and endo to end. Both demands benefit those who already have jobs. But there are millions of other Filipinos who are still unemployed and even unemployable.
In an economy with a surplus of labor or high unemployment or underemployment, endo may serve a purpose. The concept of work sharing applies. Here is how economist Raul V. Fabella, a national scientist, explained it in a recent column in BusinessWorld:
“Endo too can be beneficial as ‘labor sharing’: scarce employment opportunities are being shared by more workers; permanent work force are paid less than they would be without labor sharing; contractual work force realize some income, however sporadic, instead of none at all.
“Work attitude and work aptitude decay much faster among the long-term unemployed than among those with sporadic spells of employment…
“If HB 6908 becomes law, fewer workers will be employed and many workers now currently listed as underemployed will become openly unemployed. Businesses will invest in labor-saving machines — more smart ATMs to replace bank tellers. Investment will locate in businesses where labor cost can be passed on…
“The unintended consequence of misplaced generosity to organized labor may be less employment — as employment destruction over the long run takes over!”
But government, no thanks to election promises, is forced to adopt “solutions” that solve no problem and make no one happy. The endo EO is a good example.
Duterte, who made the endo election promise, can’t help making public statements that lack proper vetting. Now he wants 260,000 Filipinos working in Kuwait (more than 100,000 are household help) to come home. There are jobs waiting for them here, he said, as the rest of us wonder what country he is talking about.
Adding fuel to the fire is Rep. Joey Salceda of Albay, who talked about importing skilled construction workers from China and Myanmar. Salceda said Build Build Build cannot get into full swing without imported workers.
Salceda said the construction industry needs more workers for the government’s infrastructure program and the demand could not be addressed by the K to 12 graduates unless they undergo TESDA training.
“We need a 3.9 million skilled labor force which we cannot supply. The Philippines is considering importing skilled labor force in China and Burma. We are facing labor constraints as the growing demand for laborers like welders, carpentry, masonry and related skilled work construction could not be provided due to lack of training,” the Albay lawmaker said.
Ironically, there are now 10.9 million jobless Filipinos in the country, more than twice the number of workers Salceda wants to import. A Social Weather Stations (SWS) survey showed the 23.9 percent joblessness rate is an 8.2 percent increase from last year’s 15.7 percent.
There are several facets of our employment problem that must be addressed even as we fix labor policies. For one, our misguided rice policy has kept our food cost the highest in the region, which explains why labor wants higher and higher salaries.
Pulse Asia found out that most Filipinos have been “strongly affected” by price hikes in basic commodities such as food and beverage since January. A total of 98 percent out of the 1,200 respondents of Pulse Asia’s March “Ulat ng Bayan Survey” said prices of basic goods they would usually buy, like food items, have increased in prices in the last quarter, topped by rice.
Indeed, the poor feel a higher inflation rate than that felt by the average Filipino. According to the Philippine Statistical Authority, the country’s year-on-year inflation for the bottom 30 percent income households went up to 5.3 percent in the first quarter of 2018.
The annual increment of the food index at the national level rose 5.3 percent in the first quarter of 2018. Its annual rate was recorded at 3.4 percent in the previous quarter and 2.7 percent during the same period in 2017. The fish index showed a double-digit annual mark-up at 11.5 percent. All other food groups, likewise, exhibited higher annual gains during the quarter.
That is why it is important that Duterte’s announced new rice policy, which allows the private sector to import with no need for NFA permission be implemented flawlessly. Bringing down the price of rice is a gut issue with strong political implications.
Indeed, Pulse Asia’s March survey revealed that four of the top five issues Filipinos are most concerned about are gut issues: 1) Increasing pay of workers (50 percent response rate). 2) Controlling inflation (45 percent);.3). Reducing poverty (35 percent). 4) Creating more jobs (32 percent). and 5) Fighting criminality (27 percent).
A dozen rating agencies and analysts saying the economy is doing fine mean nothing to most Filipinos if they feel economic oppression in their daily lives. There was a notable increase of those who cite pay of workers as the most urgent national issue compared to the previous quarter.
Government needs to focus its attention on creating jobs. That means increased efforts to train our workers in skills demanded by employers here and abroad. For so long as our unemployed are also unemployable because they don’t have the right skills, our labor situation will remain tense.
Throwing money on it, P7 billion allocated for TESDA-run technical vocational institutions (TVIs) isn’t enough. The quality of training must be assured or that’s money down the drain. We should be wary of pretend training modules designed to just milk TESDA funds.
Incidentally, a survey showed that Filipinos are least concerned about population growth seven percent, national territorial defense six percent, terrorism four percemt, charter change three percent. This should help the administration get its priorities straight.
Boo Chanco’s e-mail address is bchanco@gmail.com. Follow him on Twitter @boochanco