Target underemployment, not just unemployment
We always hear about the need for creating more employment. But rarely do we hear about targeting underemployment. The latter is often a more cost-effective strategy.
It may take P3 million to create one manufacturing job for an unemployed person in the cities. But it takes as little as P100,000 to start an agricultural enterprise for an underemployed farmer in the rural areas. The added income may even be larger for the latter.
Our unemployment rate is 7 percent, while underemployment is 18 percent. It is time we look at the potential of addressing the underemployed, who number much more than the unemployed.
We have three million hectares of coconut lands, but only one million have intercropping. This means we have almost two million hectares of land between coconut trees that remain idle.
In addition, the coconut farmer spends the majority of his time doing little work, and is thus seriously underemployed. What a waste.
Last July 14, during the birthday of Kapampangan Development Foundation (KDF) chair Manuel Pangilinan, he launched a venture to address rural underemployment. KDF signed a Memorandum of Understanding (MOU) with Philippine Coconut Authority (PCA) to plant one million trees in Central Luzon.
The difference between this MOU compared to other PCA MOUs is that KDF will do intercropping between these coconut trees. This will mean that the P20,000 average income of a hectare devoted completely to coconut will be supplemented with P100,000 from intercropping with products such as coffee. Today, we import 80 percent of our coffee from Vietnam. Instead, the underemployed coconut farmer can become fully employed through intercropping and increase his income by five times. Adding a small honeybee enterprise to this means an additional P50,000 net income, and a 30 percent increase in coconut yield due to honeybee pollination.
KDF supports the Alyansa Agrikultura advocacy that the PCA should not only address the coconut product, but more importantly, the coconut farmer and his very low income. KDF has embarked on the strategic direction of building inclusive growth models that can be duplicated throughout the country, such as the coconut farm model.
This model adds to the traditional coconut enterprise not only value-adding from higher yielding products, such as virgin coconut oil, coconut water, and coconut sugar. It also requires intercropping, as well as other enterprises such as honeybees and swine.
Another KDF inclusive growth model that was also launched on July 14 targets the underemployed farmer to initially have 15 piglets for fattening and selling. Fifteen is the minimum number for a viable enterprise. The eventual goal is breeding and probiotic feeds from an owned feedmill. This will cut down feed cost by 50 percent, require minimum human intervention, and produce smell-free swine for optimal profitability.
These individual enterprises will be grouped into clusters, thus using economies of scale in purchasing, growing, and marketing.
Alyansa Agrikultura will help in the organization of these clusters. The piglets are provided with the guidance of Edwin Chen, Pork Producers Association of the Philippines president and Alyansa Agrikultura vice president.
With another MOU signed on the same day, president Prudencio Garcia of the multi-awarded Mekeni Corp. agreed to buy-back the swine and process them with the highest quality standards to meet both domestic and export demand.
Government support is certainly important. For coconut, the MOU was signed by Philippine Coconut Authority (PCA) chair and concurrent Food Security Secretary Francis Pangilinan, with the PCA administrator and Central Luzon regional director witnessing the signing. For the swine project, key DA officials likewise pledged their support.
The KDF strategic direction of building inclusive growth models includes transferring technology to other parts of the country.
As an example, there are two million hectares of unutilized lands between coconuts that are idle and can be used by underemployed farmers to increase their income by more than five times. This will decrease the flow of the rural underemployed to the cities in search of manufacturing jobs which may not be there. Thus, the unemployed number may even increase.
Given the great potential in agriculture, the effort to address underemployment in the rural areas should get at least the same attention as promoting manufacturing to address unemployment in the urban centers. By focusing on the underemployed, not just the unemployed, we will hasten the achievement of inclusive growth.
(The author is chair of Agriwatch, former Secretary for Presidential Flagship Programs and Projects, and former Undersecretary for Agriculture, Trade and Industry. For inquiries and suggestions, e-mail [email protected] or telefax (02) 8522112).