The stubbornness of high unemployment and underemployment despite reported third quarter economic growth affirms that joblessness is a serious cause for concern

Government’s latest labor force survey pegs unemployment at 2.80 million in October 2010, slightly higher than the 2.72 million reported in the same period last year. However these data could place the number of unemployed at 4.16 million instead, according to research group IBON.

The figure is based on a recently revised definition of unemployment and an estimate approximating the previous definition for comparability with previous years.

IBON added that while the reported creation of over a million jobs from last year is welcome, the quality of over half these jobs leaves much to be desired. Out of the one million net new jobs created, some 515,000 were in among the economy’s lowest earning sectors: agriculture (201,000 jobs), wholesale and retail trade (251,000) and private households (62,000).

The increase in jobs in agriculture is particularly problematic given its earlier reported 2.5% contraction in the third quarter, which implies lower average incomes for workers in the sector. The average basic pay of wage and salary workers in trade (Php258 daily in 2009) and private households (Php126) is also well below the national average of Php291. This could also explain why the number of underemployed persons increased by 264,000 this year.

The stubbornness of high unemployment and rising underemployment in October despite what government earlier called “scintillating” 6.5% economic growth in the third quarter affirms that joblessness remains a serious cause for concern. According to IBON, there is a problem if the economy is consistently able to register growth and deliver corporate profits but unable to create enough jobs and raise wages. The situation highlights the need for urgent reforms in the domestic economy and address its inability to create regular and productive jobs, the group said. (end)