MANILA, Philippines--Palace spokespersons tell us that this year's State of the Nation Address (Sona) by the President will be a "no-frills" speech that will confront the reality that we have problems to confront, and as always, problems on the economic front dominate the scene.
As I constantly assert, to most Filipinos, there are just three essentials that measure the state of the Philippine economy, and these are--in order of importance, according to the surveys--presyo (prices), hanapbuhay (jobs), and kita (incomes).
All the other economic statistics that the President can cite will be of secondary interest, as it is these three that directly impact on the lives of the common citizen. And if the President indeed intends to be truthful and forthright, she would acknowledge what many have called the "perfect storm" that has hit all of us, with a significant deterioration seen in all three essential measures. But more than that, indicators on the quality of life of Filipinos show a clear deterioration as well.
Record inflation
Filipinos need not be told that prices of virtually all basic commodities have risen at a pace faster than in the last 17 years. Our overall inflation rate is now well into the double digits, and the Bangko Sentral (the Philippine central bank) expects it to get worse before it gets better.
The sad reality is that the current round of inflation hits the poor even more severely than others, as the commodities that have had the steepest price increases are also the basic necessities, especially food, that figure dominantly in the daily budgets of poorer households.
To make things worse, the income of the average citizen does not only fall behind the rise in prices; in many cases, incomes have actually declined as a result of the slowing down of the economy. Consider the plight of the daily wage worker, who is able to find even less work now as people tighten their belts and significantly reduce their purchases of goods and services, production of which the jobs of the wage worker depend on.
Massive job losses
Equally disturbing, if not more so, is the fact that the economy actually saw a decline in jobs over the past year.
According to official labor and employment statistics, an estimated 168,000 jobs were lost in our economy between April 2007 and April 2008, with the industry sector actually losing 244,000. This happened even as the number of working-age Filipinos grew by another million or so.
Thus, almost three million Filipino workers are now without a job, representing an even bigger percentage of the labor force (8 percent compared to 7.4 percent a year ago). On top of that, close to seven million of those who do have a job are not even able to earn enough to sustain their families, and are thus considered "underemployed" in the statistics. Their proportion over total employed workers has risen to almost 20 percent, from 19 percent last year.
A closer look at the employment statistics reveals how the worsening jobs picture reflects the general slowdown in the economy, particularly in the industry sector. Manufacturing lost about 180,000 jobs while construction lost about 9,000 jobs in the past year, which are also the two most job-rich sectors in the economy. It would appear that the seeming construction boom of last year, which was almost entirely due to an unusual spurt in government construction, has all but fizzled out.
Income slowdown
Gross domestic product (GDP), which has slowed down to a 5.2-percent growth from last year's 7 percent, measures the value of total domestic production in the economy. The other side of the coin is the total incomes generated in the course of production, which GDP also measures.
A closer look at the numbers shows that the slowdown happened all across the different production sectors, some more severe than others. Interestingly, the main exception has been utilities (primarily electricity and water), which sped up to 10.4 percent from last year's 4.4 percent.
As already indicated above, the slowdown has been most severe in the industry sector, particularly in manufacturing and construction. These two industries also happen to be the ones most directly tied to jobs of the poor, and hence the welfare of large numbers of Filipino families.
Our true state
With all of these, there is no surprise that recent data--all official government data--show declining school enrollment rates, more school dropouts, rising hunger, worsening health, declining peace and order, diminishing hope for the future, and more.
Economic statistics are useful, but ultimately, it is the quality of Filipinos' lives that really matters. The statistics on both are disturbing. And we cannot simply blame current adverse global trends for these, because failures in our leadership and governance have clearly set us up to become even more vulnerable to these global problems than we need to be.
This is the true state of the nation. This is what we Filipinos must collectively work to change.
Comments welcome at chabito@ateneo.edu
