A THIRD of the labor force are in low-skill and low-paying jobs that make them vulnerable to falling into poverty, according to the World Bank.
In a forum on Tuesday, World Bank Country Director for Brunei, Malaysia, Philippines and Thailand Ndiamé Diop said it is crucial to help these workers. They may not be considered technically poor but they are also not “safely and securely in the middle class.”
As such, Diop said, they can easily fall into poverty anytime or when there is high inflation caused by expensive food items. Food alone accounts for 34.78 percent of the Consumer Price Index (CPI) for all households.
“They are definitely not safely and securely in the middle class. So finding ways to really help this upward mobility in their income and the type of job that they have is absolutely critical,” Diop said.
Diop said helping these workers obtain new skills through reskilling, or improving their existing skillsets through upskilling, would help address part of the problem.
While the Department of Labor and Employment (DOLE) as well as the Technical Education and Skills Development Authority (Tesda) have programs to address this, Diop said these are not enough.
He pitched measures to include not just investments in agriculture but also creating a good framework for investments in manufacturing and key services, which will improve doing business in the country.
If doing business improves, more Filipinos can get well-paying jobs that they can rely on to support themselves and their families.
“The first driver of poverty (and income) inequality reduction is job growth. It’s increasing job opportunities, the quality of jobs, and workers seeing regular increases in their real wages over time,” Diop said.
Trickle down
Bangko Sentral ng Pilipinas (BSP) Senior Assistant Governor Iluminada T. Sicat said based on the models of the central bank, the growth of the Philippine economy has improved and this improvement is going to help in creating jobs for millions.
“Hopefully, this would trickle down to people getting a more quality type of work, that would be able to improve their ability to cope with the crisis,” Sicat said.
In an earlier presentation at the ADR Stratbase Economic Outlook for 2023 virtual forum, Ateneo de Manila University Department of Economics Chairperson Alvin P. Ang said community stores have seen an increase in demand for workers.
He said communities nationwide are the ones creating new job opportunities for Filipinos after the pandemic, but the wages and salaries they offer may not be enough for their daily needs.
These community services include neighborhood parlors and barber shops, laundry services, funeral services, household repair services, and computer and mobile phone repair services, among others.
Citing data from the Philippine Statistics Authority (PSA), Ang said these establishments created some 148,000 jobs between December 2021 and March 2022; and another 148,000 jobs in March to June 2022.
More than half or 59.3 percent of these jobs are composed of personal services for wellness, except sports activities; 18.6 percent, laundry services; 9.5 percent, funeral and related services; and 9.4 percent, repair of personal and household goods, among others.
It is possible, Ang told BusinessMirror after the forum, that while these jobs provide salaries to workers consistently, the rates may be below minimum wage. This further limits their financial capability to cope with rising prices.
These kinds of jobs are also the main cause of traffic since these workers need to move from their homes to their places of work. These are the jobs that cannot be done from home, he added.
Image credits: Bernard Testa