OF SUBSTANCE AND SPIRIT
The news about the highest unemployment rate of 8.9 percent for the whole of 2021 came out in the first week of November 2021 but its impact had already resonated with the respondents of Pulse Asia for September 2021.We saw this crystal clear in the Duterte government’s handling of at least two national issues: Creating more jobs and increasing workers’ pay.
If the growth strategy of the government is anchored on sustainability and inclusivity, and it is succeeding, we should expect higher approval over time, rather than lower approval. What the scores illustrate is that the Duterte government is fast losing the fight for a more decent life for the Filipino people.
With the fourth lowest approval of 49 percent among the 14 national issues, behind inflation control (37 percent), poverty reduction (41 percent) and increasing workers’ pay (48 percent), job creation was one of the least approved deliverables of this administration. From September 2020 to September 2021, job creation descended from 72 percent to less than 50 percent approval at 49 percent, a big decline of 23 percentage points.
There was strong resonance because people are hardwired on actual experience especially during the peak of the pandemic in the second quarter of 2021. Who would ever forget the hard lockdown of 2020 and for the most part of 2021, when business establishments, both big and small, simply gave up and ceased operations, displacing millions of workers. They saw little prospects in the ever-changing health protocols and the alarming climb in COVID-19 cases and deaths with limited vaccinations.
How many people were unemployed in September 2021?
The Philippine Statistics Authority reported 4.25 million Filipinos were out of jobs. This is what it means for unemployment to increase from 8.1 percent in August to 8.9 percent in September, adding some 370,000 people to the army of the unemployed who lost their opportunity to earn money and bring home food.
With its lower approval in job creation, the administration also scored low in increasing workers’ pay and in poverty reduction, the other economic aspects of governance. More than that, it failed to arrest inflation which further diminished whatever little was left of the income of those who kept their jobs and the cash transfer, if ever received by those who were laid off.
For the bottom 30 percent income households, inflation rose by nearly double, from 2.6 percent in the first nine months of 2020 to 4.9 percent in the same period this year. There is no better way to show that inflation hits the poorest of the poor among us, those who cannot draw money from savings which they cannot afford to maintain, or from wealth they do not have.
With high unemployment and high inflation, it is not surprising that the latest BSP consumer expectations survey should show that the shares of households with savings and those with savings in the banks have declined.
In the words of those who subscribe to radical uncertainty in this more difficult world, individuals are constrained from optimization. All that they can do is to cope. But many would agree that not everyone has the means to cope.
When economic governance is poor, instances of political corruption become explosive. This is like rubbing it in. For this reason, the public scored the government’s ability to fight graft and corruption very low. From September 2020’s 77 percent approval, the score on fighting bad governance plummeted to 52 percent in September 2021, or a hefty 25 percentage points drop.
At least two stories could be behind this bad perception. One is the Pharmally scandal involving corruption. People believe this is no less than a conspiracy to defraud the government. And two, the Malampaya deal which many claim to be the most incredible crony deal because Dennis Uy’s UC Malampaya is both heavily indebted and least experienced in gas exploration having been registered only months before the sale from Shell.
Both cases would cost the Filipino people a total of more than a hundred billion pesos. Corruption makes it plain and simple that the culture of impunity is very much entrenched, literally alive and kicking all of us in the face.
Which brings us to last Monday’s first session of the Stratbase ADR Institute’s five-day Pilipinas Conference focused on post-pandemic economic recovery. Atty. Mike Toledo observed that even as economic growth was sustained in the third quarter 2021, unemployment has remained elevated. The lags involved before more jobs are created in response to economic growth are driven by how much the economy should grow to exceed its potential capacity before one sees a perceptible decline in unemployment.
But today, economic scarring and uncertainty, business and individuals’ perception of the prospects for growth may impinge precisely on the ability of the Philippine economy to grow beyond its potential. If economic governance is decent and is not punctuated by corruption in government, perhaps unemployment would be kinder to Atty. Toledo. He would see a faster decline in joblessness.
But definitely, the issue of jobs and income would be prominent in the run-up to the May 2022 election.