A Comparative Look at SWS and LFS: how unemployed are we really?

The global economic climate has been unusually fraught in recent months and the creation of badly needed jobs has become an increasing problem for many countries. The Philippines is no exception. Government certainly plays a critical role in generating jobs, with several agencies actively spurring economic growth, public expenditure and investment, public-private partnerships, training and employment assistance. But much also depends on fluctuations in the economy itself, which tends to be greatly affected by forces in both the national and international markets – not all of which are always entirely predictable.

The problem of SWS and unemployment

In a March 10-13 Social Weather Stations (SWS) survey of 1,200 registered voters from Metro Manila, unemployment was reported at a record 34%. The findings emphasized the high rate of unemployment among 18-24 year olds, with resignations and lay-offs as the main mode of exit.

But certain questions remain: would the data have yielded the same conclusions on a year-on-year basis, considering the seasonality of these occurrences? The numbers account for a time in the year when fresh graduates begin job-hunting, employees are either ending their contracts or resigning in favor of better opportunities, or employers are making room for new prospects coming in at entry-level. Actual layoffs, in fact, account for only 1% of the sample.

Indeed, while the sample cohort employed by SWS is helpful, it clearly has methodological limitations with respect to its ability to represent our heterogeneous country: a snapshot, after all, does not always represent the entire picture.

A comparison of methods

The National Statistics Office (NSO) recently released a quiet bombshell: the Labor Force Survey (LFS) findings of June 15 clearly dispute the March figures of SWS.

The LFS, routinely used by the Department of Labor and Employment (DOLE), deploys a sample of 51,000 households (compared to SWS’s mere 1200 voters), and encompasses a much wider range. Covering all eligible members aged 15 years old and over, the sample consists of college graduates, undergraduates and high school students able to work, all of whom are interviewed on a fixed, quarterly schedule.

Based on data gathered this April, LFS contends that the unemployment rate actually went down to just under 7%, while employment grew by 3%, amounting to 37.8 million employed Filipinos. The creation of as many as 1.1 million jobs can be credited to the services and manufacturing sectors — the main drivers of our economy.

The National Statistics Coordination Board reports that a valuable indicator is a noted increase in household spending – a telling indicator of an increase in income.

At 19%, underemployment (not mentioned by SWS) still exists, especially in such labor-intensive sectors as agriculture, services and industry, including manufacturing. Although many jobs are generated by these sectors, job mismatches and dissatisfaction continue.

Significantly, LFS tracks positive movements in different employment classes: an increase in the number of wage and salary workers, accounting for almost 56% of all Filipinos; more employees securing stable and full-time employment; and more Filipinos assuming leadership of their businesses in the employer’s class. However, more Filipinos still need to be encouraged to join the ranks of the self-employed.

Strengthening foundations: the Human Development and Poverty Reduction Cabinet Cluster

One successful initiative is DOLE’s Community-Based Employment Program, which monitors area-based workers with various skill levels. Its Emergency Employment Assistance Program has helped more than 9,000 victims of natural calamities in one year alone.

The Child Labor-Free Campaign, central to the Philippine Program against Child Labor, has already identified 80 barangays to systematically eliminate child labor in 16 regions. For those in dire working conditions, DOLE (with the Departments of Justice, Social Welfare and Development, the Interior and Local Government, and the Philippine National Police) has rescued about 3000 children through the Sagip Batang Manggagawa program, leading to a crackdown on exploitative establishments throughout the country.

The Public Employment Service Office, bridging the information gap between applicants and employers in different regions, also lessens job mismatches. Its online counterpart (Phil-Job.Net) lets job seekers submit their resumes, receive updates about openings and job fairs, and run the Job and Applicant Matching System for themselves.

Meanwhile, the Technical Education and Skills Development Authority offers scholarships and skills training in livelihood development for qualified young people. Through its “Agri-Pinoy” program, the Department of Agriculture provides support for farmers throughout the plantation process, including marketing and training services.

Stable growth is also expected from such key sectors as services, manufacturing and construction, as well as in medical tourism, where P3 billion in revenue is projected by 2015.

The bigger picture

An insufficient supply of job opportunities can often be a symptom rather than a cause: unemployment can also reflect a decreased demand for products and services internationally.

Despite a slow start, the Philippine economy has proven to be uncommonly resilient to international economic shocks, given the strong performance of a number of sectors (exports, services and manufacturing), which rose from 4.9% to 6.4%.

The fact that LFS covers a much wider swathe of people suggests that it is a far more representative survey than SWS. Needless to say, much more needs to be done on the labor front. Still, despite this increasingly transnational challenge, we are still doing much better than it might appear at first glance.

No comments yet.