‘Unemployment Figures Wrong; Number of Jobless Higher’

Unemployment data from the January 2009 Labor Force Survey confirms the country’s descent into greater joblessness due to the global crisis and accumulated domestic economic weaknesses. The figures however are a gross underestimation of joblessness in the country, which is likely to have already reached at least a massive 4.3 million, said research group IBON Foundation.

The officially-released figures already show an increase of 180,000 jobless Filipinos, which is reported to have reached 2.9 million in the latest labor force survey. However, the real unemployment rate is not 7.7% as officially reported but likely to be at least 11.2 percent. Combined with the 6.2 million unemployed means that there were at least 10.6 million Filipinos jobless or otherwise looking for more work and pay in January 2009.

The higher estimates made by IBON aims to correct the unwarranted change in the official unemployment definition in April 2005, which conveniently removes discouraged job seekers and those not available/willing to immediately take up work from the labor force and hence does not count them as officially unemployed, even if they do not have jobs. IBON estimates that some 2.5% of the working age population 15 years and over should still be considered part of the labor force, which implies an additional 1.5 million jobless on top of the 2.9 million officially reported– for a total of roughly 4.3 million jobless.

The additional 2.5% is based on the estimated discrepancy in official and actual labor force participation rates in 2008. The number of jobless could be even much higher if, as is likely, labor force participation rates this year become bloated by even greater numbers of discouraged job-seekers.

Job losses were apparently most severe in the manufacturing sector, which reduced 122,000 jobs from 2008. These job losses come on top of the 137,000 jobs already lost in the sector in 2008 from the year before. The construction sector also lost 39,000 which highlight the unsustainable and erratic nature of jobs in this sector. Expectedly, the financial intermediation sector has been particularly badly hit and lost 28,000 jobs– belying claims that the domestic banking and finance sector will be unaffected. Meanwhile, crowding into the wholesale and retail trade sector which generated the most jobs at 312,000 will drive down earnings in this already poorly remunerating sector even further.

The latest unemployment report underscores the deep problems of the economy: its weakened internal ability to grow, create jobs, provide incomes, and cope with the crisis. This also underscores the hazard of relying on export-oriented manufacturing instead of a solid and expanding base of domestic demand, such as would be immediately created by a strategy of genuine asset and wealth distribution. The country faces greater joblessness in the coming months, and the worst is yet to come especially with the government’s inadequate response to address the country’s severe unemployment. (Ibon Foundation) (pinoypress.net)