This story
was taken from Bulatlat, the Philippines's alternative weekly
newsmagazine (www.bulatlat.com, www.bulatlat.net, www.bulatlat.org).
Vol. V, No. 30, September 4-10, 2005
COMMENTARY
Economic Indicators that Really Matter
Despite
so-called economic growth, the average annual unemployment rate is one of the
highest rates recorded in the last half-century, underemployment rate is the
highest in almost two decades, and accelerating inflation pushes the daily cost
of living ever higher.
By Sonny Africa
IBON
Features
Posted by
Bulatlat
Presidential Management Staff head Rigoberto D.
Tiglao correctly said that the economy is important in understanding the
political storm surrounding President Gloria Macapagal-Arroyo. But to be able to
understand the roots of the overwhelming dissatisfaction of the people with the
President, it is most important to look at the indicators that really matter.
The country's workers, peasants, odd-jobbers and
low-paid public and private employees are worse off now in 2005 than 4 ½ years
ago when Ms. Arroyo took over the presidency in January 2001. Long-standing
problems of poverty, inequality, joblessness and pitiable social services have
deepened. Combined unemployment and underemployment in the second quarter of the
year is at a record high. Prices of basic commodities, petroleum products and
water and power services have been inexorably rising. These are very real
economic failures.
Despite so-called economic growth, unemployment
has been rising since 2001. The average annual unemployment rate rose from 11.1
percent in 2001 to 11.8 percent last year which is, apart from the 12.8 percent
rate in 1985, the highest recorded in the last half-century.
There were 4.8 million unemployed and 8.4
million underemployed Filipinos in April 2005, according to the last Labor Force
Survey (LFS), or a combined 13.2 million Filipinos either jobless or otherwise
still looking for additional work. This is by far the biggest number of
unemployed and underemployed the country has ever seen.
Sleight of hand
The worsening unemployment problem has even been
obscured by methodological sleight of hand in April 2005. The National
Statistical Coordination Board (NSCB) adopted a more stringent definition of
unemployment that reduced the official unemployment rate by 4.6 percent and the
number of unemployed by 1.9 million. These Filipinos did not get jobs. Rather,
by administrative fiat, they were no longer considered part of the labor force
and so weren't considered unemployed even if they remained jobless as ever.
This sorry lack of jobs is aggravated by the
serious deterioration in the quality of the jobs to be had. The number of
underemployed or those with jobs but still seeking additional work drastically
increased to 26.1 percent in April 2005 from 18.5 percent last year. This
underemployment rate is the highest in almost two decades and the 8.4 million
number of underemployed a near-record high.
That more Filipinos are struggling to eke out a
living or are putting up with whatever jobs are found is not surprising. Falling
inflation rates since the mid-1990s reversed under the Arroyo administration,
and prices have been rising with increasing rapidity in the last 3 ½ years. The
inflation rate, or the speed at which prices are rising, has risen to over 8
percent in the first half of 2005 from a whole-year average of 6 percent in
2004. Monthly inflation rates since the last quarter of 2004 are already among
the highest in the past decade.
Accelerating inflation
Accelerating inflation has pushed the daily cost
of living for a family of six ever higher, up to P629.10 in the National Capital
Region (NCR) and an average for the whole Philippines of P517.60. The implied
daily cost of living per person here is higher than the absurdly low poverty
line of P33.60 per person per day that Tiglao used to claim that poverty
incidence has gone down to 24.7 percent in 2003. By more decent standards, at
least 80 percent of the population must be considered poor.
The rising joblessness and falling real incomes
increase pressure on publicly-provided services. Unfortunately real spending on
social services, i.e., taking inflation into account, has been drastically
falling under the Arroyo administration. Comparing the period 2001-2004 with the
four years before it, real spending on education has fallen by 3.2 percent,
health spending by a large 24.5 percent and housing spending by a severe 61.0
percent. The impact would be even worse if population growth is factored in.
Social services have been increasingly crowded
out by debt servicing in the national government (NG) budget. Interest payments
on debt have steadily increased as a share of the NG budget from 24.7 percent in
2001 to a projected 33.2 percent in 2005. To make room for this, education's
share over the same period has fallen from 16.6 percent to 14.9 percent,
health's share from 1.8 percent to 1.4 percent, and housing's share from 0.3
percent to 0.2 percent. This budget deprioritization of social services hits the
poor, or those most dependent on publicly provided social services, the worst.
Malacañang's economic managers can continue with
their glowing commentaries on the supposed strength of the economy under
President Arroyo, but this would be an exercise at clutching at statistical
straws that few are likely to believe. IBON Features / Posted by Bulatlat © 2004 Bulatlat
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