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Friday, October 10, 2003
Zosa: What’s happening to jobs?
By Elbert Zosa
BIZ VANTAGE
SURVEY. In late September, the Neda released the results of its labor force survey as of July 2003, which showed that unemployment had increased to 12.7 percent from 11.2 percent last year. This meant 4.3 million individuals could not find employment.
Secretary Romy Neri was quick to explain that the increase in unemployment was due to weather–related factors that put on hold agricultural activities, thus affecting agricultural workers. I was pleasantly surprised that industry grew by 5.5 percent (259,000 jobs) and that services grew by 1.8 percent (254,000 jobs). Further, the number of workers who worked 40 hours or more had increased by six percent or 1.1 million.
Creating and keeping jobs, especially for a growing population, should be a constant urgent priority of the government. Ultimately, to an individual of employment age, the value of the economy is reflected in his own ability to find gainful work, pursue his dreams and provide for his family.
The job picture has been affected by many factors such as globalization, tariff liberalization including free trade agreements, mergers and consolidations, increased productivity from technology, poor corporate results both from innate problems and the weak economy, and the slow (but this year so far recovering) stock market.
In banking, for instance, the number of commercial banks has dropped from more than 50 in the late 1990s to 42 due mainly to mergers. ATMs and other technology tools have also reduced the need for branches—and branch jobs.
While globalization and liberalization have their positive effects, they also have negative consequences.
Just read the package of your favorite toothpaste, bath soap, shampoo or other foreign brand products you use daily. While practically all of these were manufactured in the Philippines before, chances are one or more are now imported from Thailand, Malaysia or Indonesia. With reduced tariffs, multinational companies have chosen to produce certain products in the countries where they have the best advantage.
Procter and Gamble, it seems, now produces one product in one country (e.g. Safeguard in the Philippines; Head and Shoulders in Indonesia) and exports this to other countries. Sadly, there are other companies that have decided to focus all their production outside the Philippines. It’s been speculated that some of them feared their unions, which threatened to strike despite above-average salaries and benefits.
Government, the private sector and workers themselves need a flexible strategy to deal with globalization factors. This threat will continue for as long as there are countries that enjoy cost and attitude advantages.
Take China, where the monthly salary is only $100 for eager workers. A walk down the supermarket aisles will confirm that China has made inroads on Philippine-made products. What is clear is that a lot of hard work is needed to create and protect jobs!
(Elbert welcomes comments at elzosa@yahoo.com.)
(October 10, 2003 issue)
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