World Bank expects 12.4M jobless Filipinos by 2016

The World Bank said the number of unemployed and underemployed Filipinos may jump to 12.4 million by 2016 even if the economy would be able to sustain its current growth pace.

Last year, the country’s unemployed and underemployed stood at 10 million, with the latter accounting for 7 million.

According to the World Bank, the Philippines needs to sustain a growth pace of at least 7 percent to accelerate job creation. In the first semester, the economy grew by 7.6 percent from year-ago level.

However, the World Bank said maintaining a rapid pace of growth alone would not be sufficient to prevent the rise in the number of unemployed and underemployed Filipinos.

This, it said, was because the rate of increase in jobs created would be outpaced by the rise in the number of new entrants to the labor force.

Economic growth should come along with measures that will directly create high-quality jobs to reduce unemployment and underemployment, it said.

The National Statistics Office earlier reported that the unemployment rate in the Philippines rose to 7.3 percent in July from 7 percent in the same period last year.

The underemployment rate improved but remained significant at 19.2 percent from 22.8 percent last year.

In absolute figures, there were about 3 million unemployed and 7.75 million underemployed in July.

The World Bank said the job problem in the Philippines was due to a host of factors, including “under investment” by the government and the private sector in the previous years, complex regulations and distorted policies that led to lack of competition in certain sectors.

“Addressing this job challenge requires meeting a dual challenge: expanding the formal sector employment even faster while rapidly increasing the incomes of those informally employed,” the World Bank said in its 2013 Philippine Development Report.

The World Bank has called for the creation of a coalition composed of representatives from the government, the business community and the labor sector that will hold dialogues and come up with programs and policy-reform suggestions on accelerating job creation.

Generally, the multilateral institution said, basic measures had to be accomplished to boost job creation and reduce unemployment and underemployment.

It said the government had to keep on increasing spending for public infrastructure and streamline processes for putting up businesses.

It also said the business sector had to support policies encouraging competition in industries. This means tax holidays and other fiscal incentives enjoyed by certain businesses and industries had to be made temporary.