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ISSUE 08, SEPT 2010 Manila, Philippines

MDGs and Workers Safety Nets: A Tale of Three Shocks


Threats to the attainment of Millennium Development Goals (MDGs) come in different forms and magnitudes, depending on the development context of the country. Global economic crisis, natural disasters, and structural adjustments due to trade and environmental considerations are just a few of the challenges that may push nations to miss MDG targets. Year 2009 was a challenging year, not only for the Philippines, but for the rest of the world. Like many developing countries, the Philippines was not spared from the brunt of the global economic slowdown. Scaling down of business operations resulted in job losses of both local and overseas Filipino workers. As many Filipinos braced themselves for slower economic recovery, Typhoons Ondoy and Pepeng struck the country, leaving Php 40 billion worth of losses and damages in the agriculture, fisheries and forestry sector (Post-Disaster Needs Assessment Report, p20) and adversely affecting a large share of the countrys employed workforce. Aside from these two crises, fish workers in General Santos City were also confronted with income interruptions due to the implementation of ban on tuna fishing. This adjustment, though intended to address environmental concerns, resulted in job losses of some workers whose livelihoods were dependent on this industry. Todays situation helps us realize, in retrospect, that it is not enough to merely have social protection that caters to the general population. It is important to have policies and programs in place that effectively target the more vulnerable workers and are geared towards helping the working poor. Safety nets that are pro-MDGs are needed to ensure that growth is more inclusive and poverty reduction more sustainable. MDGs Employment Indicators: Figures, Trends and Milestones Below are some of the realities that define todays Philippine labor market vis--vis the MDGs employment indicators: Growth rate of labor productivity. From 1991 to 2000, the growth rate of labor productivity increased. Since then, however, that rate has been declining. Based on preliminary statistics for 2009, the rate is projected to reach a negative figure. Employment-to-population ratio. The proportion of the countrys working-age population to employed persons did not
This paper was written by Zoren Amat, research specialist at the Institute for Labor Studies.
ISSUE 8 MDGs and Workers Safety Nets: A Tale of Three Shocks

Policy Prescriptions
The following are some areas of consideration in defining a pro-MDGs framework for workers safety net programs: Link safety net programs to productivity. A good safety net program provides workers with additional trainings, capacity enhancement, and access to technology, capital and market that increase their productivity and provide them a viable option to escape poverty. Safety nets as catalyst of productive infrastructure projects. Emergency employment should uplift the welfare of the community and contribute to addressing social needs. Priority should be given to infrastructure projects that will yield more benefits for the poor. Gender sensitivity. Safety net programs should promote empowerment of women and provide equal opportunities for women and men to participate in development undertakings. Dynamism and prudent scaling up. A good safety net service evolves over time. Formulation of a Crisis Preparedness Plan on Employment can be a potent shield to reduce risks and vulnerabilities. It is more prudent to have tried and tested programs that can be scaled up rapidly in times of crisis, rather than adding more programs which do not guarantee significant impact. Strategic collaboration and partnership. It is worthy to explore the possibility of initiating a National Workfare Program to be spearheaded by the DOLE and participated by Departments that provide emergency employment. Such arrangement can ensure that all emergency employment programs are coherent and integrated with productivity enhancement strategies.

experience any substantial movement. The ratio remained within 59.4 to 59.2 percent throughout the last two decades, except for a sharp decline in 2000. The labor force participation rate also reflected a seemingly flat rate as it was consistently in the range of 63 percent in the 1980s and 1990s. Working poverty rate. Statistics from 1997 to 2006 show that the working poverty rate is erratic and generally increasing. It is estimated that around 28 out of 100 people belong

to the working poor population that, despite having jobs, have inadequate incomes to escape the clutches of poverty. Vulnerable employment rate. In the Philippines, the general trend for vulnerable employment rate is declining over time. From the highest recorded figure of 53.1 percent in 1994, it has decreased to 45.6 in 2009. However, the decline in the number of people engaging in this kind of work has not been consistent and continuous. Based on 2003 figures, the rate increased to 48 percent from 46.7 in 2000. Vulnerable employment, particularly concerning women, is evident. Disaggregated gender statistics reveal that the rates are higher for women than men engaging in vulnerable work. Share of women in wage employment in the nonagricultural sector. On the positive note, the Philippines has an increasing number of women participating in paid employment. Though it suffered decline from 1991 to 1997, the participation rate of women in the non-agricultural sector picked up until 2006 and only suffered a slight decrease towards 2009. Toward Pro-MDGs Safety Nets for Workers The slow and sometimes decreasing trend in different MDG indicators for employment can be explained, in part, by the crises experienced by the country. The three shocks in 2009 resulted in work displacements, income reductions, and for some, shifting to informal work. The declining labor productivity and the continuous engagement of many women in vulnerable jobs from 2008 to 2009 only proves that the crises make the much needed employment opportunities even more difficult to come by. Further, as damages and losses from calamities resulted in income decline for many workers, the number of the working poor has also increased. It is during this time that safety nets are becoming more of an imperative than an option. As these programs are meant to be stop-gap responses in times of urgent situations, their impact should be enhanced by ensuring that these are connected to a bigger development agenda like the attainment of Millennium Development Goals. While the DOLE responses under the Comprehensive Livelihood and Emergency Employment Program (CLEEP) have provided workers with a soft landing, the challenge is to improve these programs by putting the attainment of MDGs at their core. In this way, such programs will not be mere stop-gap measures but spring boards for other development initiatives. At the policy level, it is important to formulate an accurate definition of safety nets for workers. The seeming lack of clear policy on objective, scope and corresponding strategies in adopting safety nets for workers made DOLE lump these programs with its regular livelihood services. This arrangement, while not strictly flawed, might result in problems such as enrolling the unintended beneficiaries while missing the target groups, having difficulty in assessing the impact of the safety net programs, or over-burdening the work of DOLEs field implementers. The following are some areas of consideration in defining a pro-MDGs framework for workers safety net programs: Link safety net programs to productivity. As CLEEP is designed as an emergency employment program, its beneficiaries will eventually have to search for new jobs in the labor market when the program ends. It is for this reason that safety net programs must be linked with productivity enhancement strategies in order
ISSUE 8 MDGs and Workers Safety Nets: A Tale of Three Shocks

to be more meaningful for workers. A good safety net should not just be concerned with providing immediate relief, but ultimately allow workers to graduate from the program. It is important to provide workers with additional trainings, capacity enhancement, and access to technology, capital and market to that increase their productivity and provide them a viable option to escape poverty. Safety nets as catalyst of productive infrastructure projects. Emergency employment should uplift the welfare of the community and contribute to addressing social needs like health and education, instead of the usual projects like community beautification and street sweeping. While cleaning-up debris is important in times of calamities, priority should be given to infrastructure projects that will yield more benefits for the poor, like building schools, clinics, day care centers and clean water sources. Gender sensitivity. Safety net programs should promote gender equality and empowerment of women, and provide equal opportunities for women and men to participate in development undertakings. Gender lenses must be used in planning safety net programs so that biases will be prevented especially against women. It is during emergencies that they and their children become more exposed to vulnerabilities. Dynamism and prudent scaling up. A good safety net service evolves over time. The appropriate balance of programs will change as the policy environment changes or when different shocks occur. Formulation of a Crisis Preparedness Plan on Employment can be a potent shield to reduce risks and vulnerabilities. The plan can provide prevention, mitigation and coping strategies and can serve as a benchmark for scaling up safety net programs. In deciding policy direction, it is more prudent to have tried and tested programs that can be scaled up rapidly in times of crisis, rather than adding more programs which do not guarantee significant impact. Prudent scaling up also calls for policy decision makers to be on guard against labor disincentives, that is, the possibility that potential beneficiaries will work less after receiving their benefits, or reduce their work efforts if eligibility for a program is tied to earned incomes or unemployment. Strategic collaboration and partnership. Crises bring together national government agencies, non-government organizations, private sector and local government units in collaborative actions to help affected workers. However, gains that have been achieved through partnership and collaborations are oftentimes put to the backburner after the crisis and opportunities are missed in extending services to more beneficiaries. It is worthy to explore the possibility of initiating a National Workfare Program to be spearheaded by the DOLE and participated by Departments that provide emergency employment. The workfare will become the point of convergence among government instrumentalities and a mechanism to foster public-private partnerships with other stakeholders. Such arrangement can ensure that all emergency employment programs are coherent and integrated with productivity enhancement strategies.

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