Reopening of the economy and increased infrastructure spending are expected to further boost the country’s employment figures, which registered better results as of March 2021.
The Philippine Statistics Authority (PSA) on Thursday reported that unemployment rate went down from 8.8 percent last February to 7.1 percent last March, the lowest since the government implemented the enhanced community quarantine (ECQ) in mid-March 2020 to end-April for Luzon, and end-May 2020 for the National Capital Region.
While the latest report is a positive development, Rizal Commercial Banking Corporation (RCBC) chief economist Michael Ricafort said this has yet to reveal the impact of the two-week ECQ in NCR Plus that started last March 29 and was extended until April 11.
He, however, underscored the differences between the ECQ implementation in 2020 and this year such as on public transportation which was not crippled unlike in 2020 thus, the impact of the strictest movement restrictions last March is not as bad as last year.
“Thus, further reopening of the economy from lockdowns would provide a more structural and sustainable solution in terms of increased production, sales, incomes/livelihood that also create/entail more employment/jobs and more working hours,” he said.
But even with the lockdowns, Ricafort said higher government spending on infrastructure is expected to support employment.
He said the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act, as well as the record-low interest rates of the Bangko Sentral ng Pilipinas (BSP), are pluses to the economy since these are seen to encourage more investments that will in turn, result in increased manpower requirements and higher economic activities.
“The unemployment rate could still gradually ease well into single-digit levels in about one to two years, consistent with the possible recovery of the broader economy in time for the 2022 Presidential election year when there would be increased government spending especially on infrastructure spending and other government projects a few months before the May 2022 elections and increased consumer spending during the campaign period especially in 1Q (first quarter) 2022,” he added.
Meanwhile, economic managers said eased movement restrictions and requiring the public to heed minimum health standards resulted in the drop of employment rate last March.
“Rising labor force participation and falling unemployment have enabled millions of Filipinos to regain their jobs and incomes in March 2021,” they said in a statement.
Aside from the decline in unemployment rate last March, the PSA said underemployment rate fell to 16.2 percent from 18.2 percent last February, “reflecting the improvement in the quality of jobs.”
Also, the labor force participation rate increased from 63.5 percent to 65 percent last March.
“These resulted in a net job creation of 2.2 million between February 2021 and March 2021, with the number of employed Filipinos increasing from 43.2 million to 45.3 million,” the statement said.
Economic managers forecast an uptick in unemployment rate in April following the implementation of the ECQ in the latter part of March and the MECQ thereafter.
“However, the impact is expected to be less severe compared to April 2020 given our more risk-managed approach to the present quarantines,” the statement added.
Source: Philippines News Agency