BSP confirms drop in inclusivity

The Bangko Sentral ng Pilipinas (BSP), in its report “Consumer outlook pessimistic for Q3 2018, less upbeat for the next quarter, year ahead” (www.bsp.gov.ph, 9/7/2018), has just confirmed that Filipino families are turning around from being mostly gainers to being mostly losers. (See my “Inclusivity has suddenly dropped,” Opinion, 8/18/18.)

The BSP’s quarterly Consumer Expectations Survey (CES) was last fielded on July 1-14, 2018, on a national sample of 5,408 households, half from the National Capital Region (NCR) and half from Areas Outside NCR (AONCR). Its sample size—much larger than the standard 1,200 national sample of a quarterly Social Weather Survey—is so adequate that I think it is squandered by not dividing the AONCR further into areas such as the Balance of Luzon, Visayas, and Mindanao like SWS does.

The CES, despite its title, is not only about the people’s expectations for the future, but also about their assessment of change from the past. What it calls the “consumer outlook of the current quarter” is a comparison of the present situation with that of 12 months ago, making it very similar to the SWS surveys of gainers and losers.

The slight difference is that the CES asks for the family’s (a) financial situation (pinansyal na kalagayan) and (b) level of family income (antas ng kita) at present compared to a year ago, whereas SWS asks for a comparison of the respondent’s quality of life (uri ng pamumuhay) at present with that of a year ago.

The CES’ “outlook indices” for financial situation and family income are computed by subtracting the percentage that said it got worse from the percentage that said it got better. This is exactly the same way that SWS computes its net gainers and net losers.

Net gainers in financial situation. The CES’ net gainers in financial situation fell (in percentage points) from +0.2 in the Q2 to -5.3 in Q3. This came after being steadily positive from 2016Q4 to 2018Q1, with the single exception of 2017Q4. All earlier net gainers in financial situation were negative, ever since the CES surveys began in 2007Q1. (I have added the + signs to the CES numbers, to make it clear that they are net-concepts.)

The net gainers in financial situation of -5.3 points in Q3 was the average of -20.2 among families with declared monthly incomes of less than P10,000, +3.1 among those with declared incomes of P10,000 to P29,999, and +27.6 among those with declared incomes of P30,000 and over. Thus, the sharing of the opportunities to be gainers was lopsided in favor of higher-income families.

Net gainers in family income. The CES’ net gainers in family income fell from +5.5 points in Q2 to a tiny 1.0 point in Q3, after being steadily positive ever since 2016Q2. All the net gainers scores earlier than 2016Q2 were negative.

The net gainers in family income of 1.0 point in Q3 was the average of -12.7 among families with monthly incomes of less than P10,000, +9.0 among those with incomes of P10,000 to P29,999, and +30.2 among those with incomes of P30,000 and over. Sharing of gaining and losing favored the higher-income families.

The CES finds family incomes highly unequal. The low-income group, with less than P10,000 in monthly income, was almost 40 percent of the CES sample. (This is consistent with SWS’ Self-Rated Poverty of 48 percent, at a median Self-Rated Poverty Threshold of P15,000 for monthly home expenses, in late June 2018.) On the other hand, the middle-income group earning P10,000 to P29,999 was 44.5 percent, and the high-income group with P30,000 and up was only 15.9 percent.

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