Filipinos suffering from spiraling prices despite easing jobless rate, analysts say

A NUMBER of Filipinos can’t cope with rising costs, even as the country’s jobless rate continued to ease in March, according to policy analysts.

“The lack of improvement in self-rated poverty has been due to the fact that agricultural prices have continued to increase, and families have been adversely affected by the continued rise in food costs,” Philip Arnold P. Tuaño, dean of the Ateneo School of Government, said in a Facebook Messenger chat.

A Social Weather Stations (SWS) poll released on Monday showed that half of Filipino families or 14 million households described themselves as poor in the first quarter of 2023 — a steady figure from the December poll.

On the same day, the local statistics agency said the Philippines’ March underemployment rate had fallen to its lowest level in 18 years.

In the SWS poll conducted on March 26 to 29, 51% of Filipino families rated themselves as poor, similar to the figure recorded in December.

The pollster said 31% of families considered themselves borderline poor, while 19% said they were not poor.

The percentage of food-poor families, meanwhile, rose to 39% in March from 34% in December.

“This means that there has been a significant increase in the number of families that have difficulties in purchasing their basic food needs,” Mr. Tuaño said.

Of the 14 million families who considered themselves poor, 1.8 million were newly poor, 1.8 million were usually poor, and 10.4 million were always poor.

Preliminary results of the Philippine Statistics Agency’s labor force survey showed the jobless rate slightly fell to 4.7% in March from 4.8% in February and 5.8% a year earlier.

“Among the biggest reasons for the unemployment rate falling slightly in March from the month before is that 274,000 Filipinos dropped out of the labor force, lowering the denominator against which the employment rate is computed,” said Jose Enrique A. Africa, executive director of think tank IBON Foundation.

“Underemployment has also likely ceased to be a reliable indicator of the quality of work because Filipinos discouraged from looking for additional work aren’t counted as underemployed even if their pay and earnings are so low,” he said in a Facebook Messenger chat.

Ludivico L. Vicente, a 55-year-old security guard at a condominium in Quezon City, is among those who have been hit by rising food prices.

He said his daily wage of  P570 is not enough to sustain his daily needs and those of his family, which lives in a Manila slum. 

“The prices of food and other commodities have been increasing,” he told BusinessWorld. “I’m also affected by rising oil prices because I use a motorbike daily.”

A more superficial reading of the latest labor force figures is consistent with the results of the latest SWS survey, Mr. Africa said.

“The March labor force Survey reports 421,000 fewer Filipinos employed than in December 2022 or the period covered by the last SWS survey before the latest one, down to 48.6 million,” he said. “The number of unemployed increased by 197,000 to 2.4 million.”

“In itself, this already goes far in explaining the increase in self-rated poor and borderline poor families to some 22.2 million, or 81% of all families,” he added. “A further explanation comes from considering the apparent worsening in the quality of work.”

The underemployment rate fell to 11.2% in March from 12.9% in February and 15.8% a year earlier, according to the survey.

But Mr. Africa said by hours worked, the number of people employed in full-time work fell by 568,000 between December and March.

“By class of workers, employment in private establishments which is presumed to mean relatively higher paying and stable actually fell by a huge 475,000 to just 23.1 million in March,” he said.

He added that with formal wage and salary work in enterprises so scarce, 21.1 million Filipinos were struggling with the low or no pay from self-employment and openly informal work.

“The number of unpaid family workers has actually been reaching record highs since the last part of 2022, despite the economy reopening and exposing the hollowness of recovery,” Mr. Africa said.

“This has averaged 4.2 million since Aug. 22, peaked at 4.8 million in February and is still high at 4.3 million in March.”

In March, the size of the labor force dipped to 51 million from 51.27 million in February. But it was higher than 49.85 million a year earlier.

This brought the labor force participation rate — the share of Filipino workforce to the total working age population of 15 years and older — to 66% in March from 66.6% in February, and 65.4% a year earlier.

Leonardo A. Lanzona, who teaches economics at the Ateneo de Manila University, said the unemployment rate has fundamentally been at a standstill as economic growth slows.

“Despite the decline in underemployment, the jobs in manufacturing and financial insurance —considered as quality jobs — have declined,” he said.

“It is hard to say where these jobs are coming from,” Mr. Lanzona said, noting that it’s likely that the jobs being created are temporary and informal in nature.

“The highest jobs created were in transportation and storage, and accommodation and food services, including wholesale and retail trade and construction,” he said. “A significant amount of these can be found in the gig sector.”

According to the labor force survey, the service sector remained the top employer in March with an employment rate of 59%, followed by agriculture at 23.5% and industry at 17.5%.

Month on month, higher employment was seen in construction, transportation and storage, mining and quarrying, manufacturing, and administrative and support services.

“Most workers seem content with having any kind of job than nothing at all,” Mr. Lanzona said. “The poor cannot afford to be unemployed.”

Employed Filipinos fell to 48.58 million in March from 48.8 million in February and 46.98 million a year earlier. – Kyle Aristophere T. Atienza