Jobs market shows strengthening signs amid low quality of wages

WHILE the results of the February Labor Force Survey indicate encouraging signs of a strengthening job market, the chairman of the House Committee on Ways and Means said last Thursday emphasized the importance of wage quality, citing rice prices as a key component.

Albay Rep. Joey Sarte Salceda issued the statement after Philippine unemployment rate decreased to 3.5 percent in February, down from 4.5 percent in the first month of the year.

Salceda said sectors such as craft and related trades saw an increase of 511,000 jobs, while plant and machine operators experienced a surge of 481,000 jobs.

Conversely, he said declines were noted in less resilient sectors like skilled agricultural workers, with a reduction of 378,000 jobs, and elementary occupations, which saw a decrease of 782,000 jobs.

“This also aligns with last year’s Business Outlook Index, which showed generally high business confidence in the mining, construction, and energy sectors, compared with agriculture and retail trade,” Salceda said.

He attributed this job consolidation to the improved business sentiment under the Marcos administration.

“This job consolidation owes much to improved business sentiment under the Marcos administration,” Salceda added.

Of particular significance is the growth observed in manufacturing jobs, which Salceda views as a positive indicator for the Philippines amid global challenges such as the slowdown of Chinese growth, sustained high interest rates by the US Fed, elevated food costs, and disruptions in the global supply chain due to regional conflicts.

Despite the overall positive trends, Salceda emphasized the importance of wage quality, citing rice prices as a key determinant.

“With job quality improving, the key priority remains to be wage quality—how far current wages can go. That will be primarily driven by the price of rice,” he said.

With rice expenses accounting for approximately 20.4 percent of low-income workers’ expenditures and driving 57 percent of price increases in March 2024, he underscores the impact of rice inflation on disposable income.

According to Salceda, rice accounts for as much as 20.4 percent of the expenses of low-income workers. The grain, he said, also drove 57 percent of price increases in March 2024.

“Without the global rice price shock, Filipino workers would be enjoying better jobs that offer enough discretionary income for other expenses, such as entertainment, household durables, and other basic comforts,” the lawmaker explained.

Salceda underscored the necessity for the Marcos administration to explore solutions that diversify rice sources, address the country’s reliance on rice imports, and mitigate the effects of factors such as El Niño.

He asserted that cheaper rice would not only alleviate inflationary pressures but also enable the generation of more and better job opportunities across non-essential sectors, ultimately enhancing the overall economic landscape.

“As it stands, the country’s ability to generate more jobs in non-essential sectors is curtailed by rice inflation, depleting disposable income,” Salceda said.

“The Marcos administration is exploring solutions that will diversify our rice sources, address our precarious position as the world’s largest importer of rice, and endure the effects of El Niño. Cheaper rice means more and better jobs,” he added.