The Philippines enjoys rapid economic growth. From 2008 to 2013, it registered an average GDP growth rate of 5.1 percent. In 2013, the economy grew at a remarkable rate of 7.2 percent despite the combined effects of typhoons and other disasters, the tamed growth of some sectors, and the global economic slowdown in the Euro zone and other trading partners. This can be attributed to improved macroeconomic fundamentals, better financial management, and the reform efforts of the present administration. Nevertheless, income inequality and poverty incidence remain high and stable in the last two decades. It is widely believed that this failure to attain greater inclusiveness is due to widespread joblessness and underemployment because of the country’s inability to rapidly expand quality job opportunities. Philippine growth has often been criticized as “jobless growth”. Senior Research Fellow Dr. Jose Ramon Albert debunks this in a policy brief titled “Is Growth Really Jobless?”, noting that “small net changes in unemployment rates are full-time jobs being created in industry and services sectors and part-time jobs lost in agriculture.”
At any rate, the jobs problem has to be confronted head on, by looking at the underlying causes. PIDS research has found that decades-old labor regulations have been ineffective, indicating that new approaches are needed. A study titled “Labor Policy Analysis for Jobs Expansion and Development,” by Drs. Aniceto Orbeta, Vicente Paqueo, and Leonardo Lanzona, found that the overall impact of the minimum wage is negative. It is disadvantageous particularly to smaller firms that dominate the economy. Moreover, it reduces the employability of young, female, and inexperienced workers, and lowers the proportion of working-age family members who will be hired. The study proposes a 12-point agenda, referred to as the Jobs Expansion and Development Initiative (JEDI). It would be better to use direct and temporary income subsidy, carefully targeted toward extremely poor households, to meet suitable norms that society considers as public good. Other measures are better educa tion, increased labor-intensive manufacturing, and greater opportunities for training on the job.
Transforming and upgrading the manufacturing industry is crucial to achieve inclusive growth, create quality jobs, increase incomes, and reduce poverty, according to the study titled “The Philippine Manufacturing Industry Roadmap: Agenda for New Industrial Policy, High Productivity Jobs, and Inclusive Growth,” by Dr. Rafaelita Aldaba, PIDS senior research fellow on secondment to the Trade department as assistant secretary. The study underscores the importance of implementing a new industrial policy that would take advantage of market opportunities and face the challenges of the AEC. Moreover, a paper titled “Regional Integration, Inclusive Growth, and Poverty: Enhancing Employment Opportunities for the Poor,” written by Senior Research Fellow Dr. Celia Reyes as lead author, explains that the manufacturing sector can provide employment opportunities for the poor and can offer relatively higher wages. To promote inclusive growth and reduce poverty, the manufacturing sector has to be made more competitive. At the same time, productivity in the agriculture sector, which is the major employer of the poor, should increase.
To know more about PIDS research on jobs and inclusive growth, visit the SocioEconomic Research Portal for the Philippines. Simply type “job”, “inclusive growth”, “education”, “poverty”, and related terms in the Search box.
Is growth really jobless?
Labor Policy Analysis for Jobs Expansion and Development
Economic Policy Monitor 2013: Addressing the Jobs Challenge toward Inclusive Growth
The Philippine Manufacturing Industry Roadmap: Agenda for New Industrial Policy, High Productivity Jobs, and Inclusive Growth
Where Are the Poor Employed? Profiling the Working Poor
Regional Integration, Inclusive Growth, and Poverty: Enhancing Employment Opportunities for the Poor
Effects of minimum wage on the Philippine economy
Promoting Inclusive Growth Through the 4Ps
At any rate, the jobs problem has to be confronted head on, by looking at the underlying causes. PIDS research has found that decades-old labor regulations have been ineffective, indicating that new approaches are needed. A study titled “Labor Policy Analysis for Jobs Expansion and Development,” by Drs. Aniceto Orbeta, Vicente Paqueo, and Leonardo Lanzona, found that the overall impact of the minimum wage is negative. It is disadvantageous particularly to smaller firms that dominate the economy. Moreover, it reduces the employability of young, female, and inexperienced workers, and lowers the proportion of working-age family members who will be hired. The study proposes a 12-point agenda, referred to as the Jobs Expansion and Development Initiative (JEDI). It would be better to use direct and temporary income subsidy, carefully targeted toward extremely poor households, to meet suitable norms that society considers as public good. Other measures are better educa tion, increased labor-intensive manufacturing, and greater opportunities for training on the job.
Transforming and upgrading the manufacturing industry is crucial to achieve inclusive growth, create quality jobs, increase incomes, and reduce poverty, according to the study titled “The Philippine Manufacturing Industry Roadmap: Agenda for New Industrial Policy, High Productivity Jobs, and Inclusive Growth,” by Dr. Rafaelita Aldaba, PIDS senior research fellow on secondment to the Trade department as assistant secretary. The study underscores the importance of implementing a new industrial policy that would take advantage of market opportunities and face the challenges of the AEC. Moreover, a paper titled “Regional Integration, Inclusive Growth, and Poverty: Enhancing Employment Opportunities for the Poor,” written by Senior Research Fellow Dr. Celia Reyes as lead author, explains that the manufacturing sector can provide employment opportunities for the poor and can offer relatively higher wages. To promote inclusive growth and reduce poverty, the manufacturing sector has to be made more competitive. At the same time, productivity in the agriculture sector, which is the major employer of the poor, should increase.
To know more about PIDS research on jobs and inclusive growth, visit the SocioEconomic Research Portal for the Philippines. Simply type “job”, “inclusive growth”, “education”, “poverty”, and related terms in the Search box.
Is growth really jobless?
Labor Policy Analysis for Jobs Expansion and Development
Economic Policy Monitor 2013: Addressing the Jobs Challenge toward Inclusive Growth
The Philippine Manufacturing Industry Roadmap: Agenda for New Industrial Policy, High Productivity Jobs, and Inclusive Growth
Where Are the Poor Employed? Profiling the Working Poor
Regional Integration, Inclusive Growth, and Poverty: Enhancing Employment Opportunities for the Poor
Effects of minimum wage on the Philippine economy
Promoting Inclusive Growth Through the 4Ps
