Less ‘trabaho’ but more ‘negosyo’

As usual, the newly released latest jobs report covering October 2017, the last for the year, is a mix of good and bad news.

The bad news is that the ranks of our jobless swelled by 148,000 since last year, bringing the number of jobless Filipinos back up to 2.2 million and pushing the unemployment rate to 5.0 percent from last year’s 4.7 percent. This came out of a 134,000 reduction in jobs this past year, even as 14,000 workers added to the labor force. That latter number may look surprisingly small given that 1.7 million new Filipinos reached working age (15 years) over the year, but it’s because they were mostly out of the job market, mostly still in school. Full implementation of the K-to-12 basic education curriculum must have had a lot to do with it. That is, those who would have been new high school graduates entering the labor force have to remain in school for another two years of senior high school, keeping them out of the labor force, but also from further swelling the ranks of the unemployed.

Agriculture continued to suffer the bulk of job losses (1.43 million), even while swinging from negative to positive output growth in the past year. At first blush, this massive job loss looks bad for our rural population, who mostly rely on agriculture and agri-related jobs. Partly offsetting these job losses were the 920,000 new jobs in the services sector and 323,000 new jobs in industry, mostly in manufacturing, which has been surging since 2010. The substantial rise in services jobs is not necessarily good news, being jobs mostly classified under trade and transportation. These are likely to be “jobs of last resort” in the informal sector, especially informal vendors and drivers of tricycles, pedicabs and jeepneys. On the other hand, hundreds of thousands of new industry-sector jobs, mostly in manufacturing and also in construction, is a positive sign of an economy that is restructuring and achieving higher overall productivity.

Herein lies the good news in the latest job numbers. The significant positive growth in farm production despite a drastic fall in farm jobs signals rising productivity in agriculture—a phenomenon that has been underway for some time. This improved farm labor productivity is also reflected in a significant 817,000 reduction in underemployed agricultural workers. Falling farm jobs need not be such bad news if this means rural workers are finding employment in better quality jobs in manufacturing and services. After all, jobs in agriculture tend to be of lower quality, being seasonal, part-time, and largely in the form of unpaid family labor.

That the situation is changing for the better is indicated by the continuous fall in numbers and percentage share of such unpaid family workers, accompanied by a corresponding rise in wage and salary jobs. In October 2017, the latter accounted for 62.3 percent of all jobs; last year it was 60.6 percent. Here, employment in private firms accounted for the largest portion, followed by jobs in the government, a major job generator in the past year with 301,000 new public-sector jobs. On the other hand, there were 1.1 million less unpaid family workers, bringing the percentage down from 8.6 to 6.0 percent of all workers. Nearly all of these are likely to have come out of farm jobs.

Noteworthy is the rise in the number of self-employed. Those among them who worked on their own rose by 88,000, but more interesting are the self-employed who employed others—that is, entrepreneurs who set up a business, of which 287,000 were added over the past year. This suggests to me that the government’s drive for attracting more micro, small and medium enterprises (MSMEs) is yielding positive results. Credit is due to the Department of Trade and Industry and private-sector partners in GoNegosyo, with Secretary Mon Lopez’s relentless push for a better enabling environment for MSMEs in the domestic and international arena. This week’s World Trade Organization Conference in Argentina was yet another such venue.

With evidence of growing numbers of negosyo, the trabaho being lost especially on our farms should in due time be replaced by better-quality and more stable jobs.

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