The COVID-19 pandemic will have a long-lasting negative impact on employment opportunities for Filipino workers, especially among the youth. Not only hundreds of thousands (estimated to be at least half a million) Overseas Filipinos Workers are returning home but the unemployment rate in the Philippines has hit the roof at 17.7 percent of the labor force as of April, 2020, according to the Philippine Statistics Authority. As leading Philippine economist Solita Collas Monsod thoroughly analyzed the PSA data in her column in The Inquirer (June 13, 2020), the Department of Labor and Employment (DOLE) was way off the mark in its projection of unemployment for the second quarter of 2020, which was 8 percent. It turned out to be more than twice. This means that 7.254 million Filipinos were unemployed in April, 2020, as compared to 2.267 million unemployed in April, 2019. As Ms. Monsod rightly remarks, this is shocking. To make matters worse, the PSA also reported that the Labor Force Participation Rate (LFPR) among Filipinos 15 years and older was estimated at 55.6 percent in April, 2020, the lowest level ever reached in the history of the Philippine labor market. This means that only 55.6 percent of the working age population were in the labor force, either already employed or looking for work. This figure was at 61 percent a year before. This drop implies that people had become pessimistic about finding work and therefore stopped looking (or were prevented from doing so).
The news is even darker for the youth, i.e., those who are between 15 to 24 years old. The youth LFPR decreased from 38.8 percent to 32.4 percent. The young are even more despairing in finding a job than for the Philippines as a whole. And among the youth, the unemployment rate was 31.6 per cent, up from 12.9 percent last year. To summarize, there are 5 million people who are not participating in the labor force, who should be. Among those who are in the labor force, 7.2 million are unemployed, for a total of 12.2 million Filipinos either who are not looking for jobs or are not able to find one.
It will take a great deal of creativity and effort for the combined forces of government, the business sector, the educational institutions, and nongovernmental organizations to address this socio-economic problem that will face the Philippines for a number of years to come. Obviously, the first order of the day is get back the economy on track to grow at the attainable rates of 6 to 8 percent of GDP in the next ten years or so. As I have discussed in my previous columns, the lead sectors after the pandemic will be food and agribusiness, the health services, construction, the digital and IT- related industries, and educational services. In fact, even as the host countries of OFWs recover from the Great Depression expected in the near future, the Filipinos who will be immediately in great demand will also be in construction, health, and educational services and in the IT-related businesses. There is no question that we will still have to count on other countries to employ our excess manpower for some time to come. The sixty-four-dollar question: How do we make sure that our labor force will have the necessary skills that will be in great demand after the pandemic?
I maintain that especially for those who are between 15 and 24 years of age, the most immediate solution will be found in technical or vocational education. This is quite obvious in the construction sector. Trillions of pesos are being spent by both the public and private sectors in Build, Build, Build programs which are now accelerating again after the pause required by the various forms of community quarantine. Even before the pandemic hit the entire global economy, the Philippines was already suffering from acute shortages of workers in the construction sector. Part of this problem may be solved by some of the OFWs returning especially from the Middle East. We must be ready, however, to meet further shortages once our economy turns around, with the construction sector leading a strong recovery. Are we going to have enough carpenters, masons, electricians, plumbers, operators of construction equipment and electro-mechanical workers to meet the demand from both the public and private sectors? The government has more than enough burden to carry in financing and operating tens of thousands of public schools imparting basic education. Skills training will have to be the main responsibility of the private sector, business working closely with the NGO sector. TheTechnical Education and Skills Development Authority (TESDA) will have to stick to a regulatory and supervisory role.
I would like to cite as a role model for the training of construction workers the Monark Foundation Institute, an NGO founded by the owners of Monark Equipment which is in the business of selling heavy construction equipment led by its present chairman, Jose Antonio Banson. Monarch Equipment is the sole authorized dealer for Caterpillar machines, gensets, lift trucks, marine propulsion, and solar panels. In 1997, Monark Equipment established the Monark Equipment Technical Institute of Asia (METIA), accepting the first batch of scholars who trained in its Heavy Equipment Servicing Technology (HEST) program, which just two years later was accredited by TESDA. Since then, this technical institute has produced more than 3,000 highly trained technicians and operators of heavy equipment for the construction industry. In 2002, the school was renamed Monark Foundation Technical Institute (MFTI). In the same year, the school started to offer Automative Technology for female scholars. By June, 2004, MFTI adopted the famous Dual Training System (DTS) of technical education perfected in Germany in which workers undergo a training program which combines classroom work with actual job exposure in cooperating partner companies. This was made possible by a German-Philippine partnership between TESDA and the German foundations KFW and GTZ. In the same year, TESDA recognized MFTI as a Center for Excellence in Autotronics in the National Capital Region.
In its 23 years of existence, MFTI has received numerous awards, both institutional and individual, such as silver medals in the ASEAN Skills Olympic and as Best Dual Training Systems Practices Model Award in NCR. In 2007, MFTI became a sublicensee of the Caterpillar Institute for the use of Caterpillar Apprentice Service Technicians Training (CASTT). The year after, a second branch of the school was established in Cagayan de Oro City to be closer to where a large number of construction projects are be undertaken in the island of Mindanao. Through its two sites in San Pedro, Laguna, and Cagayan de Oro City, the now renamed Monark Foundation (MF) will be contributing significantly to the technical manpower requirements of the “Build, Build, Build” program not only of the present administration but of at least the next two administrations that are expected to continue the building of first-class infrastructures as the Philippines joins the ranks of East Asian countries that have some of the best infrastructures in the world today. The products of MFI are of such outstanding quality that a good number of them are actually employed by Caterpillar dealers in Australia and the Middle East.
The Monark Foundation is one of the shining examples of the private sector contributing its share to the upgrading of the skills of the Filipino youth to meet the manpower demands of a rapidly industrializing country like the Philippines today. For other role models that Philippine businesses can emulate, there are the Dualtech Training Institute in Calmeray, Canlubang; the Meralco Foundation Institute in Pasig, Rizal, and the Center for Industrial Technology and Enterprise (CITE) in Talamban, Cebu. All three are well known for the training of technical workers for Philippine industries. Interested readers can easily find detailed information about these schools in the internet. I hope that many more business enterprises in the Philippines will channel their Corporate Social Responsibility efforts towards the establishment of technical schools that will produce very much needed technical manpower that at the present stage of Philippine economic development are even more necessary than university graduates.
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