TO sustain its fast-paced economic growth this year, the government must throw in efforts to improve the country’s productivity that had seen steady progress in the past years, according to a study by the State’s think tank. The country recorded an increasing labor-productivity rate over the past two decades that had summed up to an average annual growth of 2.4 percent. From P124,926 per worker in 1998, the country’s productivity ballooned to P198,996 per worker in 2016, registering a 59.3- percent hike. However, in a discussion paper by the Philippine Institute for Development Studies, researchers Maureen Ane D. Rosellon and Erlinda M. Medalla said much is to be done with the country’s productivity.
“On the productivity side, performance is improving, but the rate of growth still needs a boost,” they said.
They pointed to manufacturing as in need of an upturn. The sector recorded labor-productivity growth at an annual average growth of 4.4 percent, well above the estimated 2-percent growth registered by agriculture, industry in total and services.
For Rosellon and Medalla, if the government intends to sustain the country’s good economic performance, it must bring upon reforms directed toward the development of the country’s productivity, especially on manufacturing. This includes the innovation of a new industrial strategy “that integrates industry/manufacturing with agriculture and services, and identifies competition, innovation and productivity as the underlying framework.” div>They said the government should continue innovating the industries, as this is “placed at the heart of the industrial strategy.” Likewise, it must put a premium in developing new methods for the improvement of the government’s priority industries.
“To boost growth and make these industries competitive and productive, several strategic actions/measures have also been identified, such as addressing supply-chain gaps, human-resource development and skills training, small and medium enterprises development, innovation and upgrading, intense investment promotion and addressing horizontal issues, among others,” they said.
Nonetheless, Rosellon and Medalla said the country will be able to sustain its fast-paced economy this year and in the years to come, as long as the government keeps its eyes on improving labor productivity.
