In January 2010, after a year of 0.9 percent growth due to global recession, the jobless rate managed to fall slightly, to 7.3 percent from 7.9 percent twelve months earlier. The dip was even more remarkable with more Filipinos looking for work: The labor participation rate rose 1.2 percentage points, to 64.3 percent. That’s nearly half a million added to the workforce.
Fast-forward to April 2013. After 6.6 percent expansion last year, No. 2 in the region, and Asia-leading 7.8 percent growth in the first quarter, helped by election, infrastructure and property outlays, unemployment surged to it highest in three years, leaping to 7.5 percent from 6.9 percent a year before. This despite lower labor participation as more than a quarter of a million stopped searching for jobs.
What’s going on?
Palace spinmeisters must be racking their brains for sound bites to downplay the diminished jobs performance under President Benigno Aquino 3rd. So while we have their attention, here are a few other inconvenient truths about how Filipinos are faring in PNoy’s investment-grade country.
In the latest Social Weather Stations hunger survey in March, households that missed one or more meals over the previous three months rose to 19.2 percent, up from 16.3 percent in December, despite first-quarter growth. SWS also reported that 19.9 percent average hunger incidence last year, lifted by a record 23.8 percent in March 2012.
That average was even higher than the 19.1 percentmean in 2009, when families suffered from world recession and rice land devastation in the Ondoy and Pepeng megafloods. Moderate hunger averaged 15.6 percent last year, compared with 15.1 percent in 2009, while severe hunger was 4.3 percent, against 4.0 percent three years before.
There’s more. Another SWS measure is self-rated poverty, the percentage of families who consider themselves poor. In high-growth 2012, SRP averaged 52 percent, significantly higher than the 49 percent recorded in near-recession 2009. Last year’s mean was the highest since 2006, just before Arroyo fiscal reforms lifted confidence and growth, and pared average SRP down year after year till she left office in mid-2010.
Average poverty incidence, however, rose again in Aquino’s first two full years. This despite over P50 billion in direct stipends for the poor since mid-2010, now supposed to benefit more than 3 million families or 15 million indigent Filipinos.
Government data affirmed the unimpressive SWS poverty figures, with official poverty incidence little changed from 22.9 percent in 2009 to 22.3 percent in the first quarter of 2012, according to the National Statistical Coordination Board report in April. President Aquino wondered then whether the comparison used wrong population data. But NSCB Director-General Jose Ramon Albert respectfully pointed out that the poverty statistics were based on direct surveys and not computed from population numbers.
Moreover, it is far more productive to focus on the real governance challenge emerging from the foregoing GDP, jobs, hunger and poverty data: translating economic growth into employment and upliftment for the poor.
So rather than putting down its predecessor, the Aquino administration would do well to search for lessons to learn, especially from seemingly better results under then President Gloria Arroyo. She managed to contain unemployment, hunger and poverty, despite lower GDP growth, a virulent global recession, and devastating Luzon storms which destroyed over P200 billion in assets and output in the country’s economic core.
Having served in the Arroyo government from the second month of her presidency in 2001 until it ended on June 30, 2010, this former Cabinet member sees three key factors that helped generate jobs, put food on the table, and alleviate poverty even in \ adverse economic circumstances.
First, Arroyo gave paramount priority and constant attention to a clear, timebound employment target: a net increase of 1 million jobs nationwide every year. She announced that overarching goal upon her election as president in 2004, and made it the focus of the Medium-Term Philippine Development Plan covering her elected term from 2004 to 2010.
Thus, when faced with the choice of a balanced budget or deficit spending in 2009, Arroyo chose the latter to keep jobs generation on track. For his part, President Aquino has announced no employment target. Instead, his top objective has been to win investment grade rating, which depend on cutting deficits and raising revenues. Thus, he opted for underspending in 2011, though it held back growth and infrastructure needed to create jobs.
Next lesson is the adoption and sustained monitoring of a broad menu of initiatives to address the vast complexities of both hunger and job generation. Underscore monitoring. More than adopting an ambitious plan, the real challenge is making sure key components are being implemented as envisioned.
To hit the jobs target, the Arroyo government supported with infrastructure, funding and training those sectors with high growth potential and solid competitiveness: agriculture in Luzon and Mindanao, industrial and logistics ventures in Metro Manila and Regions 3 and 4A, tourism in Central Philippines, and business process outsourcing in major cities. Among other achievements, two legacies stand out: the “nautical highway” network of roads and ports boosting tourism and trade, and the BPO industry, which grew exponentially into a $8-billion-a-year export behemoth.
Similarly, the Accelerated Hunger Mitigation Program (AHMP) addressed point by point the major factors contributing to the problem, rather than relying mainly on one flagship program like conditional cash transfers. Thus, besides CCT, the AHMP included short-term jobs, free rice for poor students, special road lanes to reduce food transport costs, backyard vegetable gardens, microfinance, and other measures. Like job generation, hunger mitigation was constantly followed up by both Arroyo and the Presidential Management Staff.
The third factor that helped drive employment and anti-poverty work was, ironically, negative media. Unlike the current regime, the Arroyo government did not enjoy largely favorable coverage trumpeting administration gains and downplaying its failings. Nor were public trust, approval and satisfaction ratings constantly at high levels, which could breed complacency.
Under unremitting pressure from both Malacañang and media, the Arroyo Cabinet and its agencies had to deliver against tough odds. And the numbers show it.