Holidays

A small debate has been ignited by a legislator’s proposal to enact a law that moves holidays to the following Monday in the event they land on a weekend.

Workers in the formal economy certainly welcome the proposal. Having more vacation days will not hurt – or so they think.

The tourism secretary adds her voice in favor of the proposal. The long weekends that this will produce will encourage domestic tourism – or so she thinks.

Workers in the informal sector, such as street vendors, vigorously oppose the proposed legislation. When schools and offices are out, they have no business even if they have to eat everyday.

Sadly, the debate leaves out of frame the truly weighty economic fact: we have too many holidays. Depending on which holiday falls on which day, we have about a month’s worth of paid non-working days. If we add those days when a typhoon hits or heavy rain makes our roads impassable, the number of unproductive days bloats all the more.

Consider, too, the number of local holidays. These are days celebrating a town’s foundation day, a city’s charter day or the feast of some patron saint.

The number of holidays cuts into our overall productivity as a nation. We probably have the most number of paid non-working days in the world.

We are probably the only nation that commemorates its defeats, such as when Bataan fell to the Japanese Imperial Army. We commemorate tragedies such as the day Jose Rizal was executed and Ninoy Aquino was shot at the tarmac.

By presidential proclamation, we sometimes add Dec. 26 and Jan. 2 to the number of paid non-working days because our workers are “tired.” We also add the two important Islamic holidays and, depending on the year, we also add Chinese New Year.

For employers, the number of paid non-working days adds up to almost a full 14th-month pay each year, on top of the mandated 13th month bonus. That pushes up labor costs without commensurate increases in production.

Considering all the paid non-working days in the year, our daily wage is much higher than it is on paper. That means our actual labor costs are inflated while our actual productivity is diminished. This, however, applies only to workers in the formal sector. It leaves out the truly poor who fend for themselves on a day-to-day basis. Informal workers rarely get double the daily pay that our labor laws require.

It should not be a surprise, therefore, that our productivity is among the lowest in the region. In addition to the toll taken by paid non-working days, hundreds of thousands of able-bodied Filipinos are employed as security guards. This is a waste of manpower.

Wealth-creation in our economy might be a little more robust if those employed as security guards were elsewhere, producing something instead of standing by gates or poking bags at the entrances of malls. The sheer number of people employed as security guards is testimony to the failure of the police force to guarantee public security.

The goal of the welfare state ideology that grew in prominence over the last century was to reduce total working time pitted against leisure time. In rich European economies, for instance, the effective working week is down to 35 hours. The weekend begins Friday midday. We arrived at the same condition taking another route: by multiplying the number of paid non-working days.

In France, at the moment, there are large demonstrations opposing Emmanuel Macron’s plan to raise the retirement age. Trade unions want lower retirement ages and higher pensions paid retirees. That will produce an actuarial nightmare for the pensions funds that are already facing the specter of less people working and retirees living longer due to demographic changes and advancement in health care.

Again, we found another route to arrive at the same condition. In the case of the pension funds for military and other uniformed personnel, we guaranteed pension benefits without collecting contributions to make that viable. Because we pampered our uniformed personnel for decades, the Republic must now find a way to raise the P1.5 trillion needed to make their pension funds viable. That is just for the first tranche.

Surely, there is a way to reduce the number of paid non-working days to help our economy take-off. Doing that, however, will be unpopular. The unspoken reason we have so many holidays is because decision-makers earn brownie points adding to the number of paid non-working days – even if that takes a toll on our national productivity.

Salt

About 27 years ago, our brilliant legislators passed a law requiring all salt produced to be iodized. This was intended to solve the iodine deficiency in our diets and all the health implications resulting from deficiency. We could, of course, have simply handed out iodine dosages to everybody.

They made no provision to reconfigure our salt production so that it will continue to thrive. As a result, our small salt producers were driven to extinction. Today, as established during this week’s Senate hearing, we import 93 percent of all the salt we consume. Add that to the onions we source from other economies.

There are second-generation problems, too. It turns out we have difficulty exporting processed food because our producers are forced to use iodized salt – which is frowned upon elsewhere.

For nearly three decades, these problems persisted as no government agency, we now know, attends to salt production.