Experts have described the recession as a “supercrisis”, which could be long and deep. Its impact on poor and underdeveloped economies like the Philippines is just starting to unfold. Obviously, emergency employment through a stimulus package as well as labor flexibilization and export will not do the trick. A total overhaul of the economy’s orientation must now be started – shifting from an externally driven growth and job creation to a one driven by internal sources of economic expansion and employment.
BY ARNOLD PADILLA
With the entry of fresh graduates and first time workers into the labor force, the number of unemployed Filipino workers could increase by around 1.2 million by yearend. While this is already bad news, the worse is that the Arroyo administration could not adequately handle the worsening jobs crisis despite its much-touted P330-billion ($6,316,321,374 at the current exchange rate of $1=P47.496) economic stimulus package.
Rapid pace of dislocations
The increase in the number of jobless Filipinos by 1.2 million this year is based on the assumption that the labor force will grow by 900,000, the annual average since 2001. The National Economic and Development Authority (NEDA), meanwhile, projected that job losses could reach as high as 800,000 by the end of 2009. Assuming an optimistic scenario that the stimulus package could create 500,000 jobs this year, then the job creation deficit will still be around 1.2 million by December.
Add to this the expected massive displacements of overseas Filipino workers (OFWs); at the rate they are being retrenched, the number of returning jobless OFWs could reach at least 21,000 by yearend. The number could be much higher in reality because 575,000 OFWs are directly and immediately vulnerable to displacements due to the crisis, including some 268,000 factory workers in Taiwan, Macau, and South Korea.
Such estimate is also supported by the fact that foreign direct investments (FDI) and commodity exports, the main drivers of local job creation in the country, are contracting due to the financial and economic crisis. Thus, except perhaps for a few thousands of contractual jobs from the outsourcing business, there is no expected significant expansion in jobs that could make a dent on the rapid pace of unemployment. As of January, the official tally by the Department of Labor and Employment (DOLE) pegged the cumulative number of retrenched workers at 40,000 and that of displaced OFWs at 5,404.
The rapid pace of dislocations will aggravate the perennial job scarcity facing the Philippines, where an average of almost 4 million workers, or more than 11 percent of the labor force, are unemployed every year since 2001 – based on official surveys. Consider that even before the recent wave of massive displacements of Filipino workers here and abroad, the growth in the number of jobless was already alarmingly high at more than 90,000 per year under the Arroyo administration.