Examining PHL’S job creation efforts and forging a path forward

THE country’s recent employment data has sparked both optimism and concern among citizens. While the numbers indicate some improvement, it is clear that the pace of job creation is falling short of expectations. Despite the modest increase in the number of employed individuals, the latest report reveals that job generation remains below target, raising questions about the effectiveness of the government’s efforts to address unemployment and alleviate poverty. (Read the Businessmirror report: “Jobs generation remains below govt target—ibon,” April 15, 2024).

According to the Philippine Statistics Authority (PSA) data cited by nongovernment think tank Ibon Foundation Inc., the number of employed persons in February only grew by 154,000. Although the total number of employed Filipinos reached 49 million, a marginal increase from the previous year, this falls significantly short of the implied annual target. Ibon Foundation emphasizes that the apparent gains in the labor market are far from translating into meaningful employment, where individuals earn enough to sustain a decent standard of living.

The government’s Labor and Employment Plan 2023-2028 aimed to generate over three million jobs, averaging over 500,000 jobs annually. However, the current data suggests that job creation has been weak, and the decline in the number of unemployed individuals may be attributed to discouraged workers who have stopped actively seeking employment. It is disheartening to note that the labor force participation rate has also decreased, indicating a lack of optimism among job seekers.

Furthermore, Ibon Foundation highlights the prevalence of informal workers, estimating their number to be 20.4 million, representing 41.6 percent of the total employed individuals as of February 2024. This includes domestic workers, self-employed individuals, and workers in family-owned farms and businesses, many of whom are unpaid family workers. The high proportion of informal workers underscores the urgent need to create more stable and decent jobs that offer fair wages and benefits.

The fight against poverty requires a comprehensive approach, and job creation plays a pivotal role in this endeavor. As Luther Strange aptly stated, “A job is the best cure for poverty.” Meaningful employment not only provides individuals with financial security but also fosters personal growth, dignity, and a sense of purpose.

To help address the pressing issue of job creation, economists have advocated for the implementation of employment-focused fiscal policies. They cited the need to adopt fiscal strategies that prioritize job creation and economic growth. This includes targeted investments in infrastructure, education, and innovation, which can generate employment opportunities in various sectors.

Micro, small and medium-sized enterprises play vital roles in job creation. Thus, policymakers should introduce initiatives such as tax incentives, streamlined regulations, and access to affordable credit. These measures can empower MSMES to expand their operations, hire more workers, and contribute significantly to economic recovery.

Economists also cited the need for enhanced skills development programs that align with emerging job market demands. Government collaboration with educational institutions and industry experts can help ensure that our workforce is equipped with the necessary skills to meet evolving industry requirements.

Economists have also cited the need to foster a supportive environment for entrepreneurship and innovation, which can stimulate job creation and economic dynamism. Measures such as startup incubators, research grants, and simplified business regulations can empower aspiring entrepreneurs to create new ventures and generate employment opportunities.

Furthermore, there’s a need to strengthen labor market policies. This approach emphasizes the importance of robust labor market policies that safeguard workers’ rights, ensure fair wages, and promote inclusive employment practices. It also includes the needed review of labor laws to adapt to changing work dynamics, including the rise of remote work and gig economy platforms.

It is imperative for the government to acknowledge the urgency of the situation and take decisive action to address the persisting job crisis. Merely relying on marginal improvements in employment figures will not suffice. The nation’s progress hinges on the creation of sustainable and meaningful employment opportunities that empower individuals and drive inclusive economic growth. By prioritizing job creation, we can forge a brighter future for all Filipinos and turn the tide against poverty.