This week’s headline in another broadsheet was about the “rise in joblessness” and the “Cabinet was pressed to explain” it. They were quizzed on its action plan for poverty reduction, as the benefits of a strong economy were eluding the middle class and the poor.
The recent Social Weather Station (SWS) survey reported that the unemployment rate rose to 27.5% or an estimated 12.6 million Filipinos were jobless. The increase was caused by an additional 2.5 million Filipinos who joined the ranks of the jobless between September and December last year. This happened in spite of the fact that the economy rose to 7.2% (the second fastest after China)… In the previous quarter of the SWS survey, the unemployment rate was only 21.7% or some 9.6 million Filipinos were unemployed.
Various sectors and political groups proposed several ideas to solve the problem of joblessness: The socialists said that the government should “focus on having labor-intensive infrastructure projects that would achieve the twin goals of providing jobs and reconstructing devastated areas.” It further said that the reason for the increase in the number of the unemployed is the policy of “contractualization.” This is a system in which workers are hired only for less than 6 months, so that the employers will not be forced to regularize their employment and pay the corresponding benefits.
Labor groups like the Trade Unions Congress of the Philippines (TUCP), Partido ng Manggagawa (PM), and Kilusang Mayo Uno (KMU) said joblessness will continue unless the causes will be recognized and addressed. The PM in brief said that the culprits behind the rising unemployment are trade liberalization, lack of industrial programs, and privatization-led growth. TUCP’s Exec VP Seno said government must continue to attract new job-creating investments, build new roads, bridges, etc., and lower electricity rates. KMU alleges that failure to have a national industrialization program results in joblessness.
The Asian Development Bank (ADB) said the failure of the country to boost its industrial sector was a key reason why its economic growth remains far from being inclusive. It added that the industrial sector which includes manufacturing should be the one driving the economy to substantially reduce unemployment and poverty. Growth, however, over the past decade has been driven by the services sector which includes the Business Process Outsourcing (BPO). While the BPO and over all service sector have provided economic gains, these are not responsive to the need for inclusive growth. According to the ADB, the industrial sector compared with the service sector has the better ability to create job opportunities for the people. It also has a much higher multiplier effect on the economy.
In December, 2013, export earnings reached US$53.97 billion or an increase of 15.8% to US$4.9 billion from US$3.79 billion over the same period in 2012 (the National Statistics Office reported).
I have purposely filled this article with facts and figures and quotations from several sectors of our economy. Frankly like what the old saying goes I sound “like a broken record” repeating and repeating that industrialization is the key to drastically reduce the poverty level of our country. I have written over the years several articles about industrialization hoping to convince those in government to establish 5-year economic plans, to improve and amend the same, but to pursue such a plan in earnest. I have cited the Japanese Industrial Reconstruction during the Korean War. The experience of Taiwan where Land Reform was instituted for a brief period of time. And the Taiwanese correctly shifted their attention to industrialization. Of course the experience of Hong Kong, Singapore, and South Korea were also mentioned.
And how about the People’s Republic of China (PROC)? Had its government continued the Maoist Economic Model of land distribution to the peasants and small-scale rural-based industrialization, where would China be today? It was fortunate that Deng Xiaoping came up with the idea of Socialism with Chinese Characteristics. This policy was simplified by the statement that he (Deng) did not care what the “color of the cat was as long as it caught mice” and that being rich was a good idea, or words to that effect. I need not go further. The PROC today is a world economic power because of its industrialization. Need I say more?

Source: Manila Bulletin - February 18, 2014