Philippine Economy Strong but Unemployment Remains Challenge: ADB

Updated April 9, 2013 - 7:00pm

Source: http://www.philstar.com/headlines/2013/04/09/928803/philippine-economy-strong-unemployment-remains-challenge-adb

MANILA, Philippines (Xinhua) - The Philippines remains one of the most resilient economies in Southeast Asia, but such growth is neither sustainable nor inclusive as joblessness remains a problem for most Filipinos.

"A stronger industrial base is vital for increasing jobs, and will help make growth more inclusive and sustainable," said Neeraj Jain, country director for the Philippines of the Asian Development Bank (ADB).

In its latest Asian Development Outlook 2013 (ADO 2013) released today, the Manila-based lender forecasts Philippine gross domestic product (GDP) to expand 6 percent this year and in 2014.

Inflation eased to a five-year low of 3.2 percent. The ADB said it's likely to edge up to 3.6 percent in 2013 on increased consumption and a rise in excise taxes on alcohol and tobacco following the passage of the sin tax law.

ADB's forecast GDP for this year is a bit slower than the 6.6 percent growth posted in 2012. But the ADB said upbeat business and consumer sentiment, robust private consumption, increased fiscal spending, a booming services and construction sectors and higher investment and exports will continue to support the country’s economy.

But a rosy economic outlook doesn't assure that that this will translate to a better life for most Filipinos.

"The Philippine economy continues to grow but Filipinos continue to suffer due to lack of job opportunity," Norio Usui, ADB senior economist, said in a briefing held at the launch of ADO 2013 in Manila.

Usui said the Philippines has a strong growth in its hand and the next step for the Philippine government is to translate this strong growth into more jobs that will benefit most Filipinos.

Indeed, according to ADO 2013, "persistently high" levels of unemployment and underemployment remain a key concern in the country. As the latest data from the National Statistics Office has shown, about 7 percent of the 40 million labor force are unemployed, while about 20 percent are underemployed.

"Continuous deployment of overseas workers masks the severity of the unemployment problem," Usui said, alluding to the over 10 million Filipinos working overseas.

Usui said that while the services sector, mostly thanks to a growing outsourcing industry, has provided more opportunities to Filipino workers, and this is not enough to significantly reduce unemployment and underemployment levels.

"This country has 40 million labor force, and then its labor force continues to grow by an average 2 percent (per year). About 800,000 new jobs should be created just to sustain the same level (of employment)," he said.

Usui said the country needs to revive its manufacturing sector to create more jobs.

"The manufacturing (industry) has higher labor productivity," he said.

Usui said the country's policy makers need to take advantage of the Fitch Ratings latest decision to grant the Philippines its first ever investment-grade credit rating to attract more investors to the manufacturing sector.

The ratings upgrade, Usui said, has huge implications as investors now see the country as a new production base. He added that China, South Korea and Japan are interested to invest in the country.

Jain said the government needs to address the infrastructure gap and implement a more predictable tax regime that will entice more investments to come in the country.

ADB Principal Economist Donghyun Park said foreign investors are "taking a serious look" at the Philippines, noting that foreign companies are looking to set up plants in the country.

But he said there are still bottlenecks such as the lack of technical personnel to work in the manufacturing sector.  

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     Unemployment is a serious problem that our country faces today and we all know that this is one of the economic issues that is trying to solve by our government. In the article, it was stated that “The Philippine economy continues to grow but Filipinos continue to suffer due to lack of job opportunity”, but I am glad that the Philippine government’s next step is to have more jobs that will benefit most Filipinos. Also, it was stated in the article that China, South Korea and Japan are interested to invest in the country for higher labor productivity.

     Unemployment has a great impact in our economy. First, poverty, it exists because of unemployment, it is one of the reasons why there is poverty in our country. Filipinos have the potential and the skills to work but they are not employed, because they are unwilling to move to where their skills or experiences are needed, their reputations go before them in a negative way, and checking  of their background if they’re a criminal, drug addict and such. Second, lack of facilities. It is considered as a reason for unemployment because where can people apply for jobs if there are no facilities or a factory that needs employees.  Third, crime rate. Here in the Philippines, according to the article that I’ve read, the crime rate decreased by 60% as the PNP said. Unemployed people commit a crime because they need money, they are jealous to the people around them and they have nothing to do. Unemployed people don’t earn money so they are tempted to steal because they need money to sustain the needs of their family. To avoid crimes, people must have a job. They are trying to find a job, but not all jobs are enough for everyone. 

     I am sad to know that the rate for unemployed people are increasing. To lessen the unemployed people, the government should create more jobs, lower interest rates and cut off taxes. Because having no job is so difficult. Having no income is so difficult. You can't buy what you need or want if you don't have money. Everything in this world needs money. As a student, I know that after I graduate, I can't find a job. There could be a lot of trials and disappointments that would come. So "Don't waste all the opportunities that will come."

HABANG MAY BUHAY MAY PAG-ASA! 

source: 
http://useconomy.about.com/od/suppl1/p/Unemployment-Solutions.htm