LABOR WATCH

Unemployment Reaches 46-Year High  

Hitting 12.7 percent this July, data from the National Statistics Office reveal, the unemployment rate in the Philippines is said to have reached an all-time high.  The hike in unemployment can also be traced to pro-globalization policies of the government, which critics have repeatedly assailed for opening the floodgates of the Philippine economy to foreign investment.  

By Alexander Martin Remollino
Bulatlat.com

Hitting 12.7 percent this July, data from the National Statistics Office reveal, the unemployment rate in the Philippines is said to have reached an all-time high. It had climbed from 12.2 percent in April. This means that as of July, 4.35 million Filipinos were jobless, compared to 4.22 million in April this year and 3.81 million in July last year.

Observers also say that this is the first time the July unemployment rate is higher than April figures.

The unemployment rate had reached 11.2 percent last year—the highest annual unemployment rate in the Philippines since 1957, according to the Ecumenical Institute for Labor Education and Research (EILER).

Agricultural jobs

Jose L. Vistan, Jr., senior manager for research at AB Capital Securities, Inc. said the rise in unemployment is due to a decrease in agricultural jobs in the second quarter.

“Since around 30 percent of total employment comes from the agriculture sector,” he said, “I guess the rise in unemployment rates comes from the effect of slowdown in agricultural output in the second quarter.”

The agricultural sector could have played a major part in the rise in unemployment, Vistan said. “The agriculture sector is the biggest employer in the country,” he explained. “I would imagine employment in this sector could have been a significant factor.”

While there was a growth in employment in the industry and service sectors during the review period, it was not enough to offset the rise in joblessness. There were 500,000 jobs generated in the industry and service sectors, but 760,000 jobs were lost in agriculture.

Nicon Fameronag, information director of the Department of Labor and Employment (DoLE), attributes the decrease in employment in the agricultural sector to poor weather. Many of the country’s regions were battered by storms, typhoons, and floods.

Not just bad weather

Fameronag’s line is similar to that put forward by Labor Secretary Patricia Sto. Tomas, who traced labor’s problems to the foul weather.

The militant labor union Kilusang Mayo Uno (KMU) disagrees with this.

KMU Secretary General Joel Maglunsod sees the instability generated by the U.S.-Iraq war as a big factor in the rise in joblessness. “True enough, the U.S. war largely affected the local economy, but instead of taking responsibility for government’s failure to provide enough employment for the people, the DoLE’s Secretary Patricia Sto. Tomas blamed this dismal labor situation on bad weather.”

Maglunsod also sees Sec. Sto. Tomas’ suppression of labor actions as contributing to the joblessness hike. “She’s responsible for the termination of thousands of striking workers,” he pointed out. “Her pro-capitalist tactics in resolving labor cases such as the issuance of Assumption of Jurisdiction orders and illegal strike declarations are responsible for massive retrenchments and lay-offs.”

The KMU leader also points to contractualization as a major cause of job loss. “Instead of dealing with the massive retrenchment happening in local companies, particularly small and medium enterprises, the DOLE even condones the contractualization scheme and other flexible labor measures adopted by employers,” Maglunsod said. “At present, large-scale companies like San Miguel Corporation and Meralco are replacing regular employees with thousands of low-paid contractual workers.”

Globalization’s role

Aside from these, the KMU leader said, the hike in unemployment can also be traced to pro-globalization policies of the government, which critics have repeatedly assailed for opening the floodgates of the Philippine economy to foreign investment.   “The manufacturing sector has been in a constant slump due to the dumping of cheap, imported consumer goods in the local market,” he said.  “Hundreds of local small and micro enterprises were forced to close shop due to stiff competition.”

Data from independent think tank Ibon Foundation show that in the previous year, ten small- and medium-scale enterprises were forced to close shop everyday in the Philippines, thus daily throwing 212 workers into the ranks of the jobless. This was due to stiff competition, Ibon’s research director Antonio Tujan, Jr. said.

Because of this, Maglunsod added, the collapse of the Fifth Ministerial Meeting of the World Trade Organization (WTO), held recently in Cancun, Mexico, is a positive development. “At least we will be temporarily spared from new agreements on trade and investments,” Maglunsod said.

Included in the Cancun agenda were negotiations on trade and investments, which aim to totally abolish restrictions on the entry of foreign investors into the economies of the Third World.

“But still,” he added, “the Arroyo government must review its entire position on foreign economic impositions and break off entirely from the WTO for the sake of the Filipino people.” Bulatlat.com

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