The incoming finance secretary claims that the economy is on its way to full recovery, but research group IBON said that the over one million drop in employed persons in April 2022 proves otherwise. The group said this confirms that economic recovery is stumbling and more aggressive solutions such as real fiscal stimulus are urgently needed.
Current Bangko Sentral ng Pilipinas Governor and incoming Department of Finance Secretary Benjamin Diokno recently said that the Philippine economy is on the road to full recovery with economic growth expected to speed up in the second quarter of 2022. IBON however said that growth is not a reliable indicator of recovery and pointed out that the 8.3% growth in the first quarter of 2022 makes for good headlines but has not stopped the number of persons employed and in the labor force from both falling by over one million.
Philippine Statistics Authority figures show that the number of employed persons fell by a huge 1.3 million from almost 47 million in March 2022 to 45.6 million in April 2022. The number of labor force participants meanwhile fell by 1.5 million, from 49.9 million to 48.4 million over the same period.
IBON said that, amid lower employment, the big drop in labor force participants likely indicates growing numbers of discouraged workers. Even the reported drop in the number of underemployed could simply be because those wanting additional hours of work have stopped looking amid poor prospects, which is enough for them to go unreported. Underemployment declined by around one million.
IBON said that the recent hyped rapid growth is clearly not creating enough jobs and the jobless growth from before the pandemic is reasserting itself in a worse way after the harsh and over-long lockdowns.
The group said it is also worrisome that employment is becoming increasingly informal and temporary with even more Filipinos just taking up whatever work they can to make ends meet. This kind of work is however irregular and very volatile.
IBON pointed out that the economy is shedding full time work. By hours worked, the number of those working 40 hours or more collapsed by a huge 1.9 million from 30.8 million in March 2022 to 28.9 million in April 2022. On the other hand, part-time workers grew by 426,000 from 15.9 million to 16.3 million and those “with a job, not at work” grew by 138,000 in the same period.
IBON noted that most of the full-time employment lost are in service sectors where jobs tend to be temporary and insecure. The biggest decline among full-time workers is in trade (499,000), followed by public administration (321,000), manufacturing (278,000), administrative and support service activities (226,000), and financial and insurance activities (169,000).
The volatility of informal work is also seen in the figures by class of worker. The number of self-employed without any paid employee declined by 483,000 from 13.1 million to 12.6 million. Employers in own family-operated farms or businesses increased by 85,000, while unpaid family workers decreased by 731,000.
IBON estimates that nearly 19 million or 42% of jobs as of April 2022 are outright informal work made up of the self-employed, those employed in small family farms or businesses, domestic help, and unpaid family workers. This does not even count irregular workers in private establishments who should also be considered informally employed.
Looking at employment by industry, the sectors with significant job losses are agriculture and fisheries (1.1 million), public administration (275,000), trade (242,000), administrative and support service activities (160,000) and financial and insurance activities (143,000). Most of the jobs lost in the agriculture sector were part-time work indicating how employment in the sector tends to be seasonal or temporary and irregular, said the group.
IBON said that without a genuine effort and real fiscal stimulus, the government will have a very hard time bringing joblessness down in any meaningful sense. This could be made worse as oil prices remain volatile and result in rising costs of goods and services. The new government should look past the outgoing administration’s hype and pour substantial funds and resources into where it’s most needed – cash assistance to poor households, wage subsidies and support to small businesses and production sectors, said the group.
