Bu-lat-lat (boo-lat-lat) verb: to search, probe, investigate, inquire; to unearth facts

Vol. VI, No. 8      March 26 - April 1, 2006      Quezon City, Philippines











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Unemployment, Poverty Worsen under Arroyo

The worsening joblessness and underemployment reflect the backward and crisis-ridden state of the economy. It shows the folly of the neo-liberal policies of privatization, liberalization, and deregulation, not to mention the inability of the Arroyo administration in addressing poverty.


FOOD AT THE DUMP: People scavenging at the garbage dumps for crumbs of food underscore the extent of hunger to which the majority of the people in the Philippines have descended

A study by Ibon Foundation reveals that the Arroyo administration has the worst sustained joblessness rates compared to previous administrations after registering an 11.4 percent unemployment rate in 2005. The unemployment rate has been registering double digit figures since 2001.  It was able to claim a single digit figure, an adjusted rate of 7.7 percent for 2005, only after shifting to a “new” definition to exclude those not “actively seeking for work”. 

While it claimed a slight improvement in January this year, 10.7 percent by the old definition and 7.4 percent by the new definition, an analysis of the 750,000 jobs it supposedly generated in 2005 shows that the country fared no better.  Data from the National Statistics Office (NSO) shows that 51.86 percent or 389,000 of the jobs created were in unpaid family work mostly in agriculture. Another 35.06 percent or 263,000 were in the own-account category.  Thus, a mere 13.06 percent or 98,000 jobs generated since January last year were wage and salary workers.

The number of wage and salary workers already fell by 156,000 in 2005 as compared to 2004. On the other hand, the number of own account and unpaid family workers increased by 855,000 in 2005.  Aside from this, the underemployment rate is continuously increasing.  From 17 percent of the total labor force in 2004, it increased to 21 percent in 2005. Underemployment for January 2006 is at 21.3 percent or 6.9 million workers, an increase of 1.8 million from its 5.1-million level in January 2005.

In interviews with BusinessWorld, Prof. Solita Monsod of the University of the Philippines School of Economics said that the “quality of jobs created is not good.” University of Asia and the Pacific economist Stephen Huang said that the “jobs created were not productive or does not add to the economy.” 

In a press release, Ibon Foundation said, “Even these already alarming figures do not reveal the true extent of joblessness in the country. Ibon estimates that the actual employment rate in the country is only 58.4% instead of the official 91.9%, while 41.6% suffer from job scarcity (including the underemployed, workers who leave for jobs abroad, and housewives and other sectors considered ‘not in the labor force’ but would work if only jobs were available).”

This situation clearly belies the Arroyo government’s claims that the economy is on the right track and makes irrelevant the 6.1 percent growth in the gross domestic product (GDP) in the fourth quarter of 2005. 

The worsening joblessness and underemployment reflect the backward and crisis-ridden state of the economy. It shows the folly of the neoliberal policies of privatization, liberalization, and deregulation, not to mention the inability of the Arroyo administration in addressing poverty.

Worsening poverty and hunger

The government’s statistics on poverty are likewise unbelievable. The latest data of the National Statistical Coordination Board (NSCB) shows that 30.4 percent of Filipinos are poor in 2003, an improvement from the 33 percent registered in 2000.

However, this is due to the very low minimum annual per capita income. In 2003, the NSCB claims that the threshold is at P12,475 ($243.37, based on an exchange rate of P51.26 for every US dollar) for the whole country and P14,178 ($276.59) in urban areas. For 2004, it set the national threshold at P13,113 ($255.81), of which P8,734 ($170.39) was intended for sustaining food needs and the balance of P4,379 ($85.43), for other basic needs.

With this threshold, a family of five needs a regular income of P65,565 ($1,279.07) yearly or P5,464 ($106.59) monthly to meet essential needs. This translates to a P1,092 ($21.30) monthly income or a P36 ($0.70) daily income for every person.

For the food budget, NSCB claims that P727 ($14.18) per month or P24 ($0.47) per day is enough for someone to survive.  How on earth can he or she survive with this amount? What food can one eat with P24 ($0.47) per day or P8 ($0.16) per meal?  How can a P365 ($7.12) monthly or P12 ($0.23) daily budget suffice to pay for utilities, personal necessities, transportation, clothing, and rent, not to mention education and health needs? The minimum fare for a jeepney alone is already P7.50 ($0.15).

The NSCB also claims that a minimum wage worker in Metro Manila earning P325 ($6.34) daily can support a family of five. However, workers have been demanding a P125 ($2.44) across-the-board nationwide increase since 1999 since wages are not enough to meet high cost of living requirements.

For beyond government statistics, which are being manipulated to paint a rosy picture, are the views and experiences of the people themselves.  The 4th quarter 2005 survey of the Social Weather Stations (SWS) reveals that Self-Rated Poverty rose to 57%, from 49% in the Third Quarter. It has fluctuated between 46% and 58% since the start of 2004.

In a media release, the SWS survey said that, “The proportion of Filipino households experiencing hunger hit an alarming 16.7% last quarter (of 2005), a new record high from the time SWS began surveying hunger in mid-1998. It has now been in double-digits for seven consecutive quarters.”

The new record level of hunger, the SWS said, was due to an increase in Severe Hunger. The latter, defined as families going hungry Often or Always in the last three months, was at 3.9% in December 2005, affecting approximately over 600,000 families.  This reflected an increase from the 2.6% registered in August 2005.

Moderate Hunger, defined as those experiencing it Once or A Few Times in the last three months, was at 12.8% in December 2005, affecting 2.1 million families.  It was a very slight decrease from 12.9% in August 2005.

How then can the Arroyo government address poverty when its policies cause the economy to lose wage and salary jobs steadily?  How can an increase in unpaid family work and own-account jobs enable a family to rise from poverty?   

Even the much-trumpeted business process outsourcing jobs, such as call centers and medical transcription, cannot provide employment for the millions of unemployed and underemployed Filipinos. Aside from this, call centers in particular employ mainly graduates from reputable schools because of its strict English proficiency requirements. 

It is not surprising then that more and more Filipinos are intending to work or migrate abroad. 

But how many overseas Filipino workers (OFW) can be accommodated abroad? While OFW remittances prop up the economy especially the gross national product (GNP), the balance of payments (BOP) position and the gross international reserves (GIR), overseas work does not strengthen the fundamentals of the economy, particularly domestic employment. And while it provides relief from poverty to families of OFWs, the effect is temporary. Once the OFW is unable to work abroad, these families are back to where they were before except for a few.

Radical solutions

The worsening state of unemployment, underemployment, poverty and hunger clearly shows the need for radical solutions. The country has followed essentially the same economic program for 60 years: export of raw materials and semi-processed goods, dependence on imports for finished goods such as machinery, oil and consumer durables, reliance on foreign investments for capital and technology, etc. And the country has remained backward, agricultural, pre-industrial, cash-strapped and capital-deficient. It never brought the country any nearer to industrialization and prosperity. 

The country needs nothing less than radical solutions. 

But the solution does not lie in the charter change (Cha Cha) initiatives of the Arroyo administration. Politically, it is a way to keep the incumbent in Malacanang by skirting the issue of legitimacy hounding Gloria Macapagal-Arroyo and by providing her with more power, that of the president and prime minister combined.  It is also an attempt to water down the Bill of Rights provisions of the 1987 Constitution.

Worse, it is a concession to her most reliable ally, the U.S. government.  The proposed amendments practically reverse the hard-earned victory of the Filipino people when they rejected the continued stay of the U.S. military bases in the country.  Gone will be the provisions disallowing foreign military bases and nuclear weapons in the country. 

Economically, charter change merely enhances the neoliberal polices of the administration by removing all restrictions on foreign capitalists from owning land, exploiting our natural resources, and extracting profit from the provision of basic utilities and services. These are the very same policies that put the country deeper and deeper into crisis and backwardness. 

The solution lies in freeing the majority of the Filipino people from feudal bondage and backwardness through a genuine agrarian reform program and rural industrialization; optimizing local capital to enable the country to produce the needs of the domestic market and the local economy and provide gainful employment to the populace through nationalist industrialization; judicious use of our natural resources for local industry; developing our human resources through a scientific, patriotic, and democratic culture; undertaking an independent, mutually beneficial foreign policy and relations; installing a patriotic and pro-people government and instituting a sovereign and democratic constitution.

In the last five years, the Arroyo administration has shown that it will never undertake these measures. On the contrary, it has pursued the very same policies that are causing widespread poverty and has engaged in nothing more than transactional politics to appease its allies. What then is left for the Filipino people to do? Bulatlat




© 2006 Bulatlat  Alipato Publications

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