IT"S MAY day. Should Filipino workers rejoice or despair? For those who are gainfully employed and have received decent salary increases lately, there is reason to rejoice. But for those who are employed but whose pay have remained unchanged, the underemployed, and the unemployed there is nothing but despair.
Government workers should be in a celebratory mood. For three consecutive years, they have received generous salary increases. Indirectly, Bureau of Internal Revenue chief Kim Henares should be very happy too. The 2013 total wage bill of the government workers is roughly 370 billion. Higher salaries translate into higher personal income taxes. Assuming an average rate of 25% (top marginal income tax rate is 32%) that should translate into 92.6 billion personal income taxes from national government workers alone.
But for many Filipinos, May Day is a sad day. Some 2.9 million Filipinos are unemployed and another 7.9 million are underemployed -- employed but looking for better, permanent, higher paying jobs; and for the unpaid family workers, paying jobs.
The unemployment rate is virtually unchanged while the underemployment rate has increased.
In terms of warm bodies, the number of unemployed has increased slightly -- from 2,892,000 in January 2012 to 2,894,000 in January this year. By contrast, the number of underemployed has ballooned -- from 7,018,000 million in January 2012 to 7,934,000 in January 2013, or my a whopping 916,000.
Isn't this so counter-intuitive? A strong growing economy should be creating more jobs. Yet the ranks of unemployed and unemployed workers continue to swell by close to a million.
This worsening jobs outlook is related to the recently released bad news that poverty incidence during the last 10 years, inclusive of 2012, has remained unchanged. The lack of jobs has been the biggest contributor to grinding poverty.
The Philippine government pledged to reduce poverty by half by 2015. While our ASEAN-5 neighbors have met their commitment to halve poverty, we're still at least a decade away from meeting ours.
The wrong approach is to cast doubts on official statistics. Brickbats coming from the President himself has a chilling effect. Such behavior is tantamount to bullying government statisticians into doctoring official statistics.
The correct approach is to embrace the results and do what needs to be done -- more decisively and resolutely.
The to-do lists is long and formidable. Start with improving the state of public infrastructure. Airports and seaports have to be modernized. Road networks have to be improved. Power supply has to be restored, developed, and be made more reliable.
A much more ambitious, well-crafted, and speedily implemented public infrastructure program may not only propel the economy into a higher growth orbit but may also improve immensely job opportunities for this country.
Second improve economic institutions. The President and his men should be decisive. The bureaucracy has to be more effective in implementing projects.
Third, the political leadership should open up the economy in order to attract foreign direct investments. The restrictive provisions in the Philippine Constitution should be revisited and relaxed. The country's heavy reliance on hot money is myopic and risky.
Fourth, the government should be willing to invest in timely and useful information. We need more timely measures of poverty and employment. But an annual survey of family income and expenditures may be too costly. And given the close link between joblessness and poverty, a monthly rather than quarterly employment survey may be a better, more cost-effective, alternative.
We have monthly statistics on prices, exports, imports, manufacturing indices, and so on. Why can't we have monthly labor statistics? For a labor surplus economy, a monthly labor survey that describes the state and quality of employment in the country is expected to be useful for policy makers.
In a fast changing world, knowing the state of joblessness four or five months ago may be of limited use. Sooner is better. The sooner policy makers are made aware of a problem, the sooner a solution may be prescribed and applied.
Benjamin Diokno served as secretary of budget and management from 1998 to 2001. He is professor of Economics at the U.P. School of Economics.
SOURCE: NATIONAL STATISTICS COORDINATION BOARD
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