WB exec calls for job creation

Motoo Konishi, World Bank country director, told the 2013 Philippines Development Forum (PDF) that the government must work hard to address the lingering unemployment problem.

“Macroeconomic stability — the low inflation, large current account surpluses, a market-based exchange rate — is now the new “normal” for the Philippines,” Mr. Konishi said.

“Of equal importance, however, is how this growth translates into more inclusive growth that could benefit more poor Filipinos and be able to provide more and better jobs,” he added.

While strong macroeconomic fundamentals may have led to last year’s above-target 6.6% growth, he noted that 10 million Filipinos are either unemployed or underemployed, with 1.1 million new entrants to the labor force annually.

“That’s a total of 14.6 million jobs that need to be created between now and 2016 … The domestic job market in the formal, services, manufacturing, industries and jobs abroad are not enough to absorb so many people getting into the labor force,” Mr. Konishi said.

He noted that continuing policy and administrative reforms were already steps toward inclusive growth, but added: “In rising to the challenge, we need to understand that there is no simple magic formula to address this situation.”

“Given the enormity of the challenge, we all need to collaborate a lot more to ensure that all of our programs of assistance or policy reforms are filtered through the lens of the creation of jobs.”

The challenge for the government is to boost other sectors in the economy, Mr. Konishi said, citing agribusiness and agriculture as key areas.

Budget Secretary Florencio B. Abad, speaking on the sidelines of the PDF, said the government in particular was looking to improve the industry and manufacturing sectors so that these are able to generate more jobs.

“[W]hile we are happy that the services sector continues to generate revenue and employment for the economy, one of the key subjects of discussions in this conference, aside from Mindanao, is how we can reenergize and revitalize the industry and manufacturing sectors, and really identify products that can help increase labor productivity,” Mr. Abad said.

Products need to be diversified and made sophisticated so that the job opportunities generated are “substantial,” he added.

Mr. Abad acknowledged that the government must also be able to provide the infrastructure, as well as the business and financial conditions, that would attract foreign investments.

“[It’s] so critical for government, once it attains a certain level of credibility, to protect and secure that credibility … That’s why good governance continues to be the platform upon which we hope to attract … investments.”

In a related development, the Joint Foreign Chambers of the Philippines (JFC) likewise urged the government to pursue sustainable and inclusive growth.

“The Philippines still has many issues to address, not in the least poor infrastructure that makes it vulnerable to natural disasters,” it said.

“BPOs (business process outsourcing firms), while a success story, account for only 2% of jobs … We have yet to see a vibrant export sector. And while the country has immense natural resources, the mining industry has been unable to move forward.”