EVEN with the resumption of face-to-face classes and the revival of the local tourism industry in recent months, allowing more businesses to resume their operations, thousands of workers continue to lose their jobs and become financially vulnerable.
While there are existing government programs to help affected workers, most of the interventions provide short-term relief.
Congress has revived a bill, which aims to institutionalize the government’s unemployment assistance to ensure it will be sustainable and create a new agency to handle it.
Economic factors
DATA from the Philippine Statistics Authority (PSA) show the number of unemployed is still on the rise, reaching 2.68 million workers in August from 2.6 million the month before it.
This trend was also apparent in the Jobs Displacement Report of the Department of Labor and Employment (DOLE), which showed the 27,611 workers reported by employers to be permanently displaced in July had risen to 31,224 in August. It reached 34,048 by September.
IBON Foundation Executive Director Jose Enrique A. Africa said the trend may persist in the coming months.
“The trend only confirms what the administration and its economic managers should really accept—the economy will not recover simply from reopening,” Africa told the BusinessMirror in an email.
“The main cause of worsening displacements is the weakness of aggregate demand from so many accumulating factors. The protracted lockdowns severely collapsed household income and savings and increased poverty,” he added.
Government data showed the annual household income fell to P307,190 last year from P313,350 in 2018, while 19.99 million individuals lived below the poverty threshold.
Among the factors Africa sees hampering government efforts to stimulate job creation are the depreciating value of the peso, rising interest rates and looming global recession.
“Rising interest rates will make financing more expensive including for the formal establishments who tend to report to DOLE; consumption spending will also weaken. Economic activity will also be dampened as global recession and stagflation start setting in,” Africa said.
Proposed bill
CONCERNED over the needs of workers who will be displaced during the period, Marikina Second District Representative Stella Luz A. Quimbo decided to refile her House Bill (HB) 490 or the PhilJobs Act of 2020 last June.
The measure creates the Philippine Job Insurance Corporation (PhilJobs) to implement the National Unemployment Insurance Program (NUIP), which will cover all members of the Social Security System (SSS) and Government Service Insurance System (GSIS).
PhilJobs will serve similarly as the Philippine Health Insurance Corporation (PhilHealth) which provides universal health care coverage: in PhilJobs’ case, it caters to displaced workers instead.
The NUIP is necessary, Quimbo said, as she described the current unemployment assistance from the government as “fragmented, non-inclusive and limited.”
Existing programs
CURRENTLY, SSS provides unemployment benefits to its members as mandated by Republic Act 11199 or the Social Security Act of 2018.
The one-time payment of the benefit is equivalent to twice the half of the members’ average monthly salary credit (AMSC).
Most of the other government programs to help the unemployed are from the Department of Labor Employment (DOLE).
These include Tulong Panghanapbuhay sa ating Disadvantaged/Displaced Workers (TUPAD), the flagship program of DOLE. This provides emergency employment to displaced informal sector workers. There are also the Adjustment Measures Program, providing a one-time cash aid to displaced formal sector workers; and labor market and placement program; and skills training or upskilling.
Quimbo said the NUIP will integrate these programs and extend unemployment insurance benefits equal to 80 percent of the worker’s basic pay for three months.
NUIP financing
Labor leaders backed the concept of the NUIP under the proposed bill, but expressed concern on how the program will be funded.
Sentro ng Nagkakaisa at Progresibong Manggagawa (SENTRO) Secretary General Josua T. Mata wondered how Congress intends to fund the NUIP since it will need a considerable sum.
“We should not allow politicians to earn brownie points from voters by meddling with SSS benefits without providing adequate funding for it. Otherwise, they would only end up bankrupting the system,” Mata said.
TUCP President Raymond C. Mendoza has the same concern, especially since many companies and workers are still reeling from the disruption caused by the pandemic in the last two years.
He noted both groups cannot afford an “untimely” additional contribution to SSS or GSIS for the NUIP.
An alternative source to finance the NUIP, the deputy speaker said, would be through taxes.
“What TUCP proposes is consideration of the possibility that at least 15 percent of all corporate taxes be earmarked by the BIR, DOF and DBM for purposes of building up this proposed unemployment insurance scheme,” Mendoza said.
HB 490 is currently pending at the committee level at the House of Representatives.
Ongoing integration
DOLE recently started efforts to improve its unemployment programs so it will have long-term impact to its beneficiaries.
In August, Labor and Employment Secretary Bienvenido E. Laguesma announced they will pilot the inclusion of a skills training component in the implementation of their TUPAD in areas affected by the magnitude 7 earthquake in Abra in July.
TUPAD beneficiaries are usually given light public works like street sweeping, debris cleaning and declogging works, lasting 10 to 90 days.
But with their pilot partnership with the Technical Education and Skills Development Authority (TESDA), the TUPAD beneficiaries will be included in the pool of workers who will be tapped to help in the rehabilitation of infrastructure and heritage sites, which were damaged by the Abra earthquake.
DOLE also used the same model in its memorandum of agreement with the Department of Environment and Natural Resources (DENR), wherein TUPAD beneficiaries will get skills training so they could help forest rangers in conducting patrols, seedling production, plantation establishment, and protection activities.
Mata said the pilot initiatives from DOLE will eventually lead to TUPAD being “redesigned” to become their proposed public employment program.
“This means that it [TUPAD] should not be simply a safety net for the unemployed where they are given only 10 days of work. Instead, it should be transformed into a guaranteed jobs program that could run for at least 9 months,” Mata said.
“More importantly, the type of jobs it should support should be aligned with the country’s development needs and mitigation plans for climate change,” he added.
Image credits: NONOY LACZA