NEDA concerned over job loss, vows to correct situation

September 12, 2017

Expressing concern over employment losses in July, the National Economic and Development Authority (NEDA) said Tuesday it  vowed to improve employment figures by pushing for reforms anchored on the Philippine Development Plan (PDP) 2017-2022.

The recent Labor Force Survey (LFS) of the Philippine Statistics Authority, a NEDA-attached agency, showed that employment rate dipped by 0.2 percentage points to 94.4 percent in July 2017 from 94.6 percent during the same period last year.

“The overall job market contraction in July followed a trend that began in the first round of the LFS in January this year. But despite this slight contraction, the nation's underemployment dropped to its lowest in more than a decade at 16.3 percent,” Socioeconomic Planning Secretary Ernesto Pernia said.

Unemployment rate stood at 5.6 percent, which means 2.4 million people were unemployed. Even though it made an uptick by 0.2 percentage points from July 2016, the figure was still the second lowest among all the July figures since 2006.

“The government is concerned over loss in employment and vows to improve the situation. For one, the Build Build Build program, anchored on the PDP, is expected to open the roads for more jobs and generate significant activity in the domestic economy," Pernia said.

With some of the government's 75 flagship projects commencing soon, around 1.1 million new jobs will be created every year, he said.

Pernia stressed that one way to enhance the impact of the heavy infrastructure spending on the labor market is by tapping the domestic economy's technical and blue-collared workers for the government's infrastructure projects and programs.

He said the continued implementation of the K-to-12 program will increase the productivity of the country’s future workforce. Increased access to Technical and Vocational Education Training programs will also help laborers upgrade their skills and find more employment options. Further, the displaced workers in the education sector will be mitigated by the more vigorous information dissemination of the K to 12 Adjustment Measure Program of the government.

The decline in the employment was attributed to the drop in the labor force, with significant job losses in the agriculture and service sectors.

“The manufacturing and construction sectors have recorded job growth. But the widespread employment losses in the agriculture and services more than offset these gains,” he said, noting that the agriculture sector recorded the heaviest employment loss (-9.2% or 1.03 million employment).

The subsectors in services which recorded employment losses are consistent with the priority establishments and industries being closely watched by the government under the Department of Labor and Employment's Labor Law Compliance System (LLCS).

The LLCS is a pro-worker reform started in 2013 to ensure employers' compliance with a comprehensive checklist of laws.

"The recent changes in labor policies regarding contractual workers may have had a perverse effect on firms’ hiring decision," Pernia said.

The labor force participation rate (LFPR) was lower by 2.6 percentage points, dropping to 60.6 percent in July 2017. The decline was attributed to  significant downturn in the female labor force participation rate to 45.5 percent for the period from 49.0 percent a year ago.

The number of permanent employment further declined, shedding 663,000 jobs across industries, but more severely in agriculture (66 percent) and services (28.4 percent).

Short-term employment increased with the bulk of it coming from the industry, particularly in construction and manufacturing. DMS