Delayed budget impact also felt in industries which earned less in 2nd quarter of 2019

MANILA, Philippines–Earnings by major industries in the second quarter of 2019 slowed to 6.5 percent alongside a weaker growth in the economy still brought about by the delay in the 2019 budget that forced government to underspend.

The growth in gross earnings of industries between April and June was below the 9.6 percent expansion in 2018, the Philippine Statistics Authority (PSA) said in a report on Thursday, Sept. 19.

Finance and trade had the fastest increase in gross earnings in the second quarter of 2019—12.6 and 12.5 percent.

Earnings of electricity, gas and water companies rose 10.1 percent. Real estate was up by 9.1 percent. Other services, 6.2 percent; transport, storage and communications, 5.8 percent; mining, 4.2 percent and manufacturing, 2.4 percent.

Second quarter gross domestic product (GDP) growth slowed in 2019 to a more than four-year low of 5.5 percent as the government underspent by at least P1 billion a day on public goods and services. This was caused by the late approval of 2019’s P3.7-trillion national budget by a legislature fighting over kickbacks from pork barrel funds.

But although industries earned less, they hired more people and increased wages, PSA data showed.

Employment index inched up 1.9 percent from April to June 2019, faster than 1.3 percent in 2018.

Manufacturing jobs grew 5.4 percent; real estate, up 5 percent; transportation, storage and communication, 4.4 percent; mining and quarrying, 4.1 percent; trade, 2.2 percent; electricity, gas and water supply, 1.3 percent; and finance, 0.7 percent.

However, other services and construction companies shed jobs by 0.1 percent and 2 percent as public construction projects screeched to a halt due to the ban ahead of the May 13 midterm polls and the lack of budget to rollout the government’s infrastructure projects.

Compensation index climbed 4.7 percent in the second quarter, also faster than the 3.7 percent recorded last year.

Compensation in the electricity, gas and water supply sector jumped 10.9 percent; mining and quarrying, 8.1 percent; manufacturing, 7.1 percent; trade, 5.8 percent; transportation, storage and communication, 4.8 percent; real estate, 4.4 percent; other services, 3.8 percent; and finance, 1.9 percent.

Salaries in the construction sector, however, fell slightly during the same period./TSB