Jobless, but ‘employed’

Last Tuesday, the Inquirer’s subhead, “SWS: Unemployment rate rose to 27.5% in Q4,” was critically imprecise, because the SWS statistic Joblessness is defined differently from the official statistic Unemployment. To emphasize the difference here, I write the former with a capital J, and the latter with a capital U. Unlike the ordinary mass media, SWS is careful not to interchange its term Joblessness with the official term Unemployment.

Shortsighted reportage. As usual, too much is being made of the single-quarter increase in Joblessness, from 21.7 percent in September 2013 to 27.5 percent in December 2013.  Myopic journalists fail to notice that the 21.7 was the lowest quarterly percentage ever since December 2011. Averaging over four quarters, the Joblessness percentage of the full year 2013 was 25.2; this was 3.6 points below the 28.8 in the full year 2012.

The previous annual averages were 23.6 in 2011, 22.5 in 2010, 29.0 in 2009, 28.8 in 2008, 25.2 in 2007, 26.4 in 2006, and 22.6 in 2004.  In 1993-2003, on the other hand, the average was below 20 percent. Thus, high Joblessness, like Self-rated Poverty, has been lingering for a decade.

For SWS, “Jobless” means No Job Now + Looking for Work. I have done at least three Inquirer columns to explain the difference—“Is 1 hour a week a ‘job’?” (5/26/2012), “Joblessness and underemployment” (2/23/2013), and “Joblessness versus idleness” (10/12/2013).

SWS asks first: “Kayo po ba ay (a) may trabaho sa kasalukuyan, (b) walang trabaho ngayon pero mayroon dati, o (c) hindi pa nagtrabaho kahit minsan? “ (“Do you (a) have a job at present, (b) have no job now but had one before, or (c) not have worked yet?”) This identifies those with jobs at the time of the interview.

SWS then asks those in (b) or (c): “Kayo po ba ay naghahanap ng trabaho o nagbabalak magtayo ng negosyo, o hindi?” (“Are you looking for a job or planning to set up a business, or not?”)  The Jobless are those seeking a job or business; the rest are outside the labor force, which is the sum of those with jobs and those Jobless.  SWS Joblessness is the ratio of the Jobless to the labor force. In the SWS December 2013 survey, Joblessness was 27.5 percent, corresponding to about 12.1 million adults.

SWS adjustment for Availability. However, quite a few Jobless are not available for work if a job appears within two weeks. Exclusion of those not immediately available for a job results in an SWS Jobless/Available rate of 17.1 percent in December 2013, corresponding to 6.6 million adults.  Though in the original SWS report (www.sws.org.ph/pr20140210.htm), this was buried in the second-to-last paragraph of the BusinessWorld report of 2/10/2014, and not mentioned at all in the Inquirer report.

For the government, “Unemployment” means Idle Last Week + Looking for Work + Available for Work. In the government’s Labor Force Survey, all respondents who worked for as little as one hour in the week before interview are classified as Employed (as well as those not actually working last week but already with a job/business or starting one within two weeks).  Those idle and seeking work are Unemployed; those idle but not seeking work, and not available for work if an opportunity arises within two weeks, are outside the labor force, which is the sum of the Employed and the Unemployed.  Official Unemployment is the ratio of the Unemployed to the labor force.

The official Unemployment rate was 6.5 percent in the October 2013 Labor Force Survey.  This should be compared to the SWS Jobless/Available rate of 17.1 percent, rather than to the SWS Joblessness rate of 27.5 percent.  Application of the availability criterion thus makes the difference between SWS and official measures only 10.6 points, rather than 21.0 points.

The key to the contrast between SWS and official figures is the latter’s stingy one-hour rule. Official Unemployment is so low because so few can afford to be idle.  Surely, many of those who say they are Jobless, when interviewed by SWS, were not idle in the past week, but did odd work to earn whatever they could.  They are Jobless, but “Employed”. The stingy rule has resulted in a statistical cover-up of the problem of lack of decent jobs.  (To the argument that other countries also use a stingy rule, my reply is that those countries are also covering up their problem.)

High Underemployment is the giveaway. If 93.5 percent of the labor force, according to the October 2013 Labor Force Survey, were officially active or Employed in the past week, then why did as many as 17.9 percent also say, in the same survey, that they want more work, i.e., are Underemployed?  This means that their working hours are so short and/or their earning-rates are so low that they are virtually Jobless.  If one adds official Unemployment and Underemployment, the discrepancy from SWS Joblessness vanishes.

“Yolanda” cannot be blamed. New analysis of the December 2013 survey shows Joblessness at 26.8 percent among adults from the storm-victimized households, or even lower than the 27.7 percent among nonvictims. The estimated 12.1 million national total of Jobless adults in December 2013 consists of 1.8 million among Yolanda victims and 10.3 million among nonvictims.

The Yolanda survivors—on their own, and helped by others—are economically as busy as Filipinos in general.  They aren’t twiddling their thumbs.

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(I thank Josefina Mar of SWS for computations used here and in “Poverty, hunger and Yolanda,” Inquirer, 1/25/2014.)

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Contact mahar.mangahas@sws.org.ph.