Unemployment in the Philippines Rises

The unemployment rate in the Philippines  increased to 7.3 percent in July 2013 from 7 percent in the same period last year according to a  yahoo.news philippines report from the NSO, National Statistics Office.

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However, a  Social Weather Stations, SWS, March survey showed  the unemployment rate in the country increased to 25.4 percent from 24.6 percent in December 2012. This is equivalent to about 11.1 million jobless Filipinos.  (Source: Sun Star)

The SWS was established in August 1985 as a private non-stock, nonprofit social research institution.  Quite a discrepancy in their figures versus the NSO, the government's mouthpiece.

While the economy is being boosted by call centers and remittances from OFW's, which amounts to about 10 percent of the gross domestic product, the Philippine's poverty level hasn’t decreased since 2006. The SWS has supported that finding in recent surveys but the present administration of the Philippines believes that the SWS surveys are flawed. Marjorie, Shina, Sharwin and JalAmiel

Sister-in-law Marjorie, far left, has spent two years working in Saudi Arabia and over two years working in Kuwait as a domestic helper. We care for her two children, niece Shaina and nephew, Sharwen, seated next to their mother. Little JalAmiel, another niece, is seated next to her cousins. Marjorie recently renewed her employment contract for another two years in Kuwait. 

The Philippines attracts the least foreign direct investment in Southeast Asia, according to the World Bank. That’s in part because contract disputes and regulatory reversals in the past led companies, including Frankfurt, Germany-based Fraport AG, to leave the country.

Fraport stopped work on an almost-completed airport terminal building in 2002 and later sought compensation after having its contract nullified by the Philippine Supreme Court.

Presiding over a country with one of the youngest populations in the world, the government needs to finds jobs not just for the current unemployed but also for the growing ranks of teenagers entering the workforce. The Philippine labor pool will expand by almost 18 million, or 31 percent, to 75 million by 2020 compared with 2010, Bank of America Corp. projected in April last year.

Breaking up families  with the continual reliance on overseas Filipino workers is not the solution. My own asawa worked for years as a domestic helper and caretaker in Singapore and Taiwan. In Taiwan she worked two years straight without one day off, a direct violation of her contract. But if she would have complained, her employers would have replaced her with another Filipino faster than a jeepney driver on shabu. Jeepney

Almost half of all jobless Filipinos are between the ages of 15 and 24, according to the government statistics office. The biggest area of employment remains agriculture and fishing,  which provides work for 30.4 million people, or almost a third of the population. About 8 percent work in manufacturing. (Source: bloomberg.com)

The Philippines unemployment rate is the worst in Southeast Asia and more than double the regional average.

So please, if you are reading this and you are a foreigner, be advised that the majority of expats would recommend you have a fixed monthly income, such as a pension, before moving or retiring to the Philippines. If the average Filipino has difficulty in finding work, what makes you think you would fare better?  

Author: The Kano

POST AUTHOR: "THE KANO" aka "THE CRUSTY OLD EXPAT." Dave DeWall, "The Kano", is the Publisher & Editor-in-Chief of "Philippines Plus" in publication since August 2009. He is also the CEO of Lizard Poop Productions and author of the best-selling guide book "The Philippines Expat Advisor." Dave moved to the Philippines in July 2009 from Central Illinois with his lovely wife of over 18 years, "The Sainted Patient Wife." The couple reside in a rural province in Western Visayas, Guimaras. The small island province is said to have the sweetest mangoes in the world. They do not have any children but are the proud owners of eight active canines, including a Belgian Shepherd called "Killer" "Killer" has bitten five people in the last two years along with one goat and a carabao. "Killer" doesn't like strangers. Or goats. Or carabaos.

20 thoughts on “Unemployment in the Philippines Rises

  1. Dave,

             I like your new format!  It is a shame that the unemployment rates are so high. Too bad the government does not do something.

     

                                           Fearless Frank from Florida

    1. Thanks, much, Fearless Frank from Florida. What the government does is simply rely on more and more Filipinos going overseas to work instead of providing viable, good paying jobs with a livable wage. Without the monthy remittances sent to the Philippines the economy here would suffer a major blow. 

    1. The Philippine governenment is extremely unfriendly to foreign investment, Murray, and doesn’t allow foreign companies to be a majority shareholder in Filipino businesses. Coupled with the ongoing corruption issue and the extreme amount of red tape, it’s doubtful things will change much in the near future. Aquino doesn’t want to hold a constitutional charter change to allow any changes in the current law to make the Philippines more investment friendly for foreigners. 

      On another note, sent you an email to let you know Lolo has received the medications that you generously sent, Murray. The family and I thank you so much

  2. Population among the impoverished plays a big role in the unemployment rate.  The number of children born into poverty here is absolutely staggering.  Then there's the church's role and responsibility for that as well….  No end in sight.

     

    It is the "starving season", as the impoverished in the squatter villages call the typhoon season.  Due to the increased danger for fishing and such, many are unable to even catch fish to subsist.  With no money reserves, the crime rate goes up every year at this time of year.  And where do they go?  To cities like this one where there are more targets of opportunity.  Be careful out there and keep a firm hand on your valuables in public.  Two years ago, in this season, I got hit by some professional pickpockets, and I was being "careful".  I just underestimated how professional and organized some of them are.

    1. You probably saw this recent article in The Daily Guardian, Rease: 

      ILOILO City Mayor Jed Patrick Mabilog said he is getting exasperated with Atis and Badjaos begging in the city.

      “We keep on returning the Badjaos to where they come from, but they keep on coming back to beg here. The Atis too also return every December to beg. We are not, however, giving up or we will be remiss on our obligation under the Anti-Mendicancy Law,” Mabilog said.

      The begging Atis and Badjaos are among those referred to under Presidential Decree No. 1563, or the Anti-Mendicancy Law.

      PD 1563 defines a mendicant as “…any person…who has no visible and legal means of support, or lawful employment and who is physically able to work but neglects to apply himself to some lawful calling and instead uses begging as a means of living.”

      The mayor said some Atis have lately put up a makeshift shelter at the Jaro Plaza. The Badjaos also found a place in the city which they are renting at P50 per month.

      “I have already sent people to tell them to vacate, and we are trying to arrange their return to their native places. The Atis, to Barotac Viejo; and the Badjaos to Mindanao,” he said.

      The Badjaos are known to be natives of Basilan Island in Mindanao.

      “If they return again, well, we will again send them back,” the mayor added with a sigh.

       

      I’ve been fortunate to never have been the victim of pickpockets or other thieves in over four years of living in the Philippines, two of those years in Iloilo and constantly riding the jeepneys. Our only probably with thieves has been a teacher at my nephew’s high school (more on that story coming up.)

      The beggars mentioned in the above, article, as you know, like to frequent the downtown Delgado area. One of their favorite hangouts is SM Delgado where some mothers, smoking a cigarette, hold their naked babies in front of  the window at the Shakey’s Pizza Parlor trying to elicit funds. At the end of their “shift,” I’ve seen them dress the baby and take off to find a more lucrative spot. 

      1. I missed that article, thanks for sharing Dave.  Many are unaware of the anti-mendiancy law in the Philippines.  I keep a copy of it handy on my tablet at all times.  Technically it's not only illegal to beg, but also illegal to give money to beggars.  A few times I've been given a hard time by Philippinos for being "stingy" and not giving money to beggars.  When I insist they read a copy of their own law they quickly change their tune 🙂

         

        It's UFC fight day at Rob's bar in Mandurriao.  I hear a cold beer calling my name….

        1. You’re welcome, Rease. I’m aware of that law, also, and though some people might think it harsh not to give to beggars, we have enough relatives that we support to make up what we don’t give to those asking for money on the streets. Some of the street beggars in Iloilo are organized and run by syndicates. The gangs end up getting most of the funds collected and constantly keep an eye on those they have begging on the streets. Life in the Philippines? It can be extremely harsh. 

  3. There is some earthquake level upheaval going on in US economic academe.  It sums up as "efficiency isn't useful if there is no end user demand."

    The next array of jobs scheduled to be lost are stadium hotdog vendors.  It's important to understand that these jobs, like so many others, didn't or aren't going away to China.  They are just going away.

    The Philippines government probably wants to embrace the modern aura of automation and feel first worldish, but they shouldn't.  They don't need self serve bar code readers.  They don't need anything automated if they have people looking for work.  If twenty guys walking behind plows can plow a field fast enough (fast enough, not necessarily *faster* than a John Deere, just fast enough) then give them the work and pay them what the JD rental and fuel was going to cost.

    They will then have money to buy the crops.  

    1. Your remark brings to mind a recent news report on Solar News in the Philippines that I watched the other day, Owen. The Agriculture Dept. of the PHL was touting this expensive, modern rice thresher that would do the work of 75 laborers. Government officials paraded this machine in action surrounded by a flock of local rice farmers and touted this as the solution to the so-called rice shortage in the Phililppines.  Does anyone watching that same report honestly believe the average Filipino farmer can run out and buy one of these contraptions? The rice fields in Guimaras, my wife’s home province, are still tended by manual laborers and a carabao  pulling a plow. 

      Didn’t know about the hot dog vendors losing their jobs, however. America, America, how far you have fallen. 

  4. I would definatly be inclined to go with the SWS stats, rather than the NSO stats on unemployment there. I would have guessed even higher than the SWS findings actually, cause so many there cant really be traced or followed because they are homeless, and doubt they can keep accurate records because of that.

    I think (not that that matters) that the Philippine Govt. has a lot to do with why things are the way they are there. They make it so most foreign companies wouldnt want to set up business there, and foreign investment is the only way I can see it possible to get the amount of jobs needed there. There are so many there that could do manufacturing jobs, not that they pay very good, but I think that those that want a job would do manufactuning jobs if they had the opportunity too rather than starve or be a squatter. There is no incentive that I have ever seen for business to want to movw there, only roadblocks.

    I can certainly understand why there Govt. does not want to allow foreigners to own property there, but at the same time it keeps investors from wanting to come there for that reason. Whats happened in the US, with China especially, that law does prevent, I think we should have put some kind of limits on it here in US, but its pretty much too late now, as China has taken over the US economy, in many ways, and foreign oil has taken the rest it seems, but as Americans, we adapt.

    I am certainly no economist, not even sure if I spelled it correctly, but personally the way things currently are there, I can only see them getting worse, instead of getting better.

    As a hopeful future expat, when we move there, its for retirement, not too work for me.

    1. Bill S, a couple of years ago I read that one Philippine Senator (whose name I cannot recall) stated that the NSO figures were totally inaccurate and put the Philippine unemployment rate at 45% which I believe is more accurate. The NSO figures, are in my opinion after living here for over four years, simply smoke and mirrors, much like the so-called highly touted campaign against corruption.

      Corruption, red tape and the limitations put on foreign investors will continue to stifle any real job growth and foreign investments in the Philippines.

      I, too, Bill, came here to retire. This website keeps me from going even more loco loco. Maintaining this site in no way resembles “work” in any way, shape or form. 😛

  5. Dave,

    Philippines should look at Singapore/Bangkok to see how a big modern city is run and is tourist friendly.  Those cities are accessable from the airport by rail to most areas of the city, clean and safe for the most part. Bangkok does have heavy traffic like Manila, but they follow the traffic laws there and in Singapore. Bangkok surprised me as to how modern they are. There was a time when the Philippines was one of the top destinations in Asia. Before we let on our trip we were riding a jeepney in Manila and a lady got here cell phone stolen by a boy who reached in the window and took it from her while she was talking on it.

    1. You’re right, Papa Duck. Melinda, as has your Anne, worked in Singapore, and was extremely impressed by the cleanliness of the city and it’s public transportion system. The Philippines is light years away from having such a modern infrastructure. It won’t happen in my lifetime. 

      Riding a jeepney in Manila (which I have done numerous times, although always escorted by my asawa and a relative) is a vastly different experience than riding one in Iloilo. I’m on heightened alert when I visit Manila but don’t let my guard down in Iloilo, either, as I do know some expats who have been robbed riding our local jeepneys. I must look too grumpy. They don’t bother me. 

  6. Out of curiosity I just looked up a combine/harvester/rice thresher.  Price tag at alibaba $50,000 USD.  Speed of operation about 3 miles/hour.  The manufacturer says it replaces 75 guys?  What do those guys make?  $7/day?  So X 75 = $525/day.  You don't harvest and pay the 75 guys every day of the year.  But you do pay interest on your purchase loan every day of the year.  The thing weighs 1300 pounds.  Gasoline mileage isn't going to be great so you have more costs than fuel and oil.  And let's tack on the usual 1-2%/annual maintenance contract.

    And let's also note the 50K and the maintenance money and the fuel money is leaving the Philippines.  The 50K will be logged as corporate profit by someone and they'll pay taxes on it, elsewhere.  Probably some in the Phils, but not much. 

    The guys making their $7/day will buy food and pay for rent/life and pay some income tax. Hmmm important question, do OFWs pay Philippines income tax? 

    Anyway, it's going to take a lot of days for that $525 to be larger than the machine's up front and ongoing costs.

    1. Thanks for that research, Owen. Frankly, I laughed my butt off when I saw that report. It was obviously a PR attempt by the Agriculture Dept and the rice thresher manufacturer. Your research indicates the impractically of implementing these machines (which the vast majority of people could not afford) across the Philippines.

      My wife did pay income tax as an OFW, Owen, when she worked in Singapore and Taiwan.

      Again, thanks for the info on the thresher. 

  7. Re: OFW income tax.  My thinking was/is shipping OFWs out to make more money outside the Phils is actually insidious inducement for the government to orchestrate aid agencies ante up to buy those threshers and force those 75 guys into OFW status.

    They'll make more, pay more taxes' and drive govt salaries up.

    1. Owen, with over ten million Filipinos working abroad, paying taxes and sending remittances back to the PHL, I wouldn’t be surprised if your reasoning is correct. Job creation in the Philippines? Whenever any “job fairs” are held, the Labor Dept. touts the thousands of vacancies that are filled, the vast majority of those, yeah, you guess it, overseas. 

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