This paper traces the labor and employment situation from 2001 to 2003, with particular focus on the employment contributions of the social partners – government, business and labor.  The Report explains the situation of a “jobless growth”. The economy grew by 4.6 percent in 2002 but generated only 906,000 new jobs vis-à-vis the 1.1 million increase in the labor force. The same is true in 2003 when economy grew by 4.5 percent but created only a measly 565,000 new jobs against some 624,000 new entrants and re-entrants to the labor force.  This inability of the local economy to create enough employment opportunities combined with the faster growth of the labor force caused unemployment to increase further. From 3.653 million in 2001, unemployed persons increased to 3.942 million in 2003; average unemployment rate for period was 11.3 percent.

The rate of employment growth was on the downtrend: from 6.2 percent in 2001 to 3.1 percent in 2002 to 1.9 percent in 2003. Also, the underemployment rate or the magnitude of employed persons who remain unsatisfied with their income and seek additional hours of work posted an increase of 200,000, from 5.0 million in 2001 to 5.2 million in 2004 or a 17 percent underemployment rate.

Overseas employment, together with the export performance of the electronic sector, served as the saving grace to the lackluster economic performance during the three-year period. Despite the uncertainties brought about by global events such as the war in Iraq , the SARS outbreak, and the growing competition from other labor-sending countries, the Philippines generated a total of 2,624 million jobs over the three-year period. Overseas Filipino workers likewise remitted approximately US$21 billion.   

Four strategies to combat unemployment are outlined in the paper:

Enhancing Employment. This means improving both the quality of the workforce in terms of competencies, productivity and work values, and the quality of employment in terms of conditions, remuneration, and welfare. It basically calls for measures that would improve the general quality and efficiency of education and training, and reorienting education and training toward the industry’s manpower requirements.

Facilitating Employment. Interventions in this regard are directed at developing and improving access to employment opportunities and alternatives both local and abroad, and providing accurate and updated labor market information to improve skills and job matching.

Preserving Employment. The objective is to prevent job losses as a result of closures, strikes and lockouts, and other forms of termination of employment.  Achievements in this area include the organization of 20 industry tripartite councils that covered 9,808 workers from 903 establishments, forging of seven social accords, and improvement in the disposition rates of actual strikes from 92.3 percent (35 out of 39) in 2002 to 100 percent (41 out of 41) in 2003.

Generating Employment. To provide for more job opportunities, the government has created an environment where business and investments will thrive; provided alternative employment or livelihood activities and pump-priming activities, and facilitated overseas deployment of workers to friendly host countries.