MANILA - Despite high hopes that the Arroyo administration will be able to create a million jobs every year starting 2004, the updated Medium-Term Philippine Development Plan (MTPDP) 2004 to 2010 showed that job generation remained below target.

The updated MTPDP said while the government was able to generate around 3.5 million jobs in the 2004 to 2008 period, this represented a backlog of around 3.5 million jobs.

The initial target set by the government was to create around 1.4 million jobs every year.

The government cited various reasons for the job-generation gap, one of the most notable being the global economic crisis which started to affect the Philippine economy in 2008.

“Unemployment remains high and meeting job-creation targets continues to be a challenge,” the MTPDP stated. “The estimated 3.5 million employment generated in the 2004 to 2008 period represents a backlog of about 3.5 million, given a target of at least 1.4 million employment created per year. Moreover, employment creation in 2008 suffered following a slowing economy, generating only 530,000 new employment.”

Using the old concept of unemployment on which the plan targets were based, the unemployment rate improved from 11.9% in 2004 to 11.4%, 11.1% and 10.8% in 2005, 2006 and 2007, respectively.

However, the economic blueprint showed that this was below the original MTPDP targets.

Using the new International Labor Organization (ILO)-based methodology, unemployment rate stood at 8% in 2006, 7.3% in 2007, and 7.4% in 2008.

The National Statistics Office (NSO) started to adopt the ILO standards in reporting labor-force statistics in 2004. Under the ILO’s definition, those who are unavailable to do work would no longer be classified as unemployed.

This reduced the number of unemployed persons in the country. In October 2004, while the Philippine definition showed that unemployment increased to 10.9%, the ILO standards showed that unemployment only reached 7.1%.

The MTPDP also stressed that due to the backlog, the country’s employment growth from 2004 to 2007 continued to lag behind economic or gross domestic product (GDP) growth.

The plan showed that the average growth from 2005 to 2008, GDP growth hit 5.5% while employment growth only reached 2.2%.

GDP growth in 2005 was at 5% while employment growth was only 2.3%; 2006, 5.4% GDP growth and 2.1% employment growth; 2007, 7.2%GDP growth and 2.8% employment growth; and 2008, 4.6% GDP growth and 1.6% employment growth.

“Broad sectoral-growth patterns were so highly uneven that in 2008, employment grew by only 1.6%. The employment growth in services and agriculture, on the other hand, managed to hit 2.2% and 2.1%, respectively. Industry bore the brunt of the bleak external environment with a 1.5 contraction in employment,” the MTPDP stated.

Jobs generated were 713,000 in 2005; 675,000 in 2006; 925,000 in 2007; and 530,000 in 2008.

In 2005, jobs generated in agriculture were 252,000; industry, 32,000; manufacturing, 20,000; and services, 429,000. In 2006, jobs generated in agriculture were 201,000; and services, 488,000.

However, industry lost 14,000 jobs; manufacturing lost 16,000 jobs; The biggest gap seen in job creation and economic growth was in 2007. Despite almost 1 million jobs created, most of these jobs were in the services sector of 697,000 jobs. The 7.2% GDP growth only created 104,000 jobs in agriculture, 124,000 jobs in industry, and 6,000 jobs in manufacturing.

In addition, the MTPDP also said the biggest losses in jobs were recorded in 2008 when industry recorded a loss of 75,000 jobs and manufacturing, a staggering 134,000 jobs.

Agriculture and services, however, created 242,000 and 362,000 jobs, respectively.

The plan also stressed that the number of the underemployed, or those already working but still want to work more, went down to 19.3% in 2008, or approximately 6.6 million employed persons from 20.1% in 2007, the lowest since 2005.

Most or around 59.5% of the visibly underemployed or those working less than 40 hours were working in the agriculture sector, followed by services with 29.8%, and industry, 10.7%.

The decline in underemployment was registered mainly in the services sector, particularly wholesale and retail trade, and agriculture, hunting and forestry.

“Greater efforts to address underemployment, a problem as serious as unemployment, should be pursued. Policy interventions must focus not only on creating more jobs, but also in generating more productive employment,” the plan stressed.

“More productive employment affords adequate income to keep workers and their families out of poverty, provides good working conditions and security in times of adversity, and allows workers to have a voice in decisions that affect their livelihood,” it added.