November 4th, 2021
The September Labor Force Survey (LFS) shows that jobs are beginning to solidify. The wholesale and retail trade and repair of motor vehicles and motorcycles sector grew by 353,000 employed persons, signifying that the increased reopening of the economy is helping make this highly face-to-face sector recover.
Although unemployed persons increased by around 370,000, this is largely due to seasonal effects in agriculture, which lost around 862,000 jobs. At this stage, most rice crops for the season have already been planted and harvest season is still some months away. These months are also called “tiempo muerto” in sugar-producing areas; I expect agricultural jobs to have recovered last month and this month, which should be reflected in the next LFS.
The job decline in manufacturing is mildly concerning. The sector lost some 343,000 jobs month-on-month when Christmas season manufacturing should begin to pick up. I expect the recovery in retail trade to eventually pull up manufacturing once stocks begin to be sold out.
Youth labor force participation rate (LFPR) dropped to 35.8 percent in September 2021 from 37.8 percent in August 2021. Youth employment rate was down to 82.3 percent in September 2021, from 84.0 percent in August 2021. I attribute this to the resumption of classes, as evidenced by the increase of jobs in the education sector (by 115,000 jobs).
The prospects in that sector were buoyed by the suspension of the Revenue Regulations imposing regular corporate income tax on proprietary schools, as well as the approval by Congress of House Bill No. 9913. Both actions were spearheaded by the House Committee on Ways and Means and this representation.
Overall, the trend from April to the latest LFS shows that the aggregate job situation has begun to solidify. While this is good news for those who were able to find jobs, the unemployment situation remains concerning, as improving vaccination rates appear to have done little to reduce unemployment. The lowest hanging fruits for the state to stimulate job growth are:
(1) Issue a directive to agencies with high underutilization rates to complete their procurement plans, especially of human resource personnel. Public administration and defense; compulsory social security was a job growth driver for September (118,000 jobs) and will remain so if HR procurement can be completed over the course of the next months prior to election ban;
(2) Reduce the risk of lockdowns and community transmission by considering vaccine mandates for employees and tenants of highly exposed places such as public markets and other community spaces;
(3) Complete the 2021 infrastructure program by issuing directives to district engineering offices;
(4) Assist growing sectors such as the BPO sector in recruiting employees by directing local public employment and services offices and the Technical Education and Skills Development Authority to craft agreements and collaborate with such sectors.
These low-hanging fruits can all be picked by mere executive action.