CLOSURE of businesses during the community quarantine is the reason for the spike to record-high Philippines unemployment rate last April, thus Finance Secretary Carlos Dominguez III believes the uptick in the number of unemployed persons is temporary.
Citing the recent statement of Bangko Sentral Gov. Benjamin Diokno, Dominguez said the unemployment rate in the fourth month this year “is not due to any other reason other than the lockdown.”
“So, there is no structural problem with our economy except that there was a decision made to lockdown the economy in order to reduce the potential number of people who will get sick and die,” he said in a press briefing on Monday.
Last April, unemployment rate surged to 17.7 percent, accounting to about 7.3 million individuals. This was way higher than the 5.3 percent rate last January and the 5.1 percent in April 2019.
Dominguez is optimistic the figures will be better in the coming months as the economy reopens, demand starts to pick up and people regain their jobs.
As a result of the lockdown, growth, as measured by gross domestic product (GDP), posted a 0.2-percent contraction from a 6.4-percent output in the previous quarter.
Dominguez said while the government’s financial support to workers will not be able to cover every one, Filipinos will start to find jobs and this will help in the economic recovery.
He declined to give any figures on how much this unemployment rate will impact on domestic output, saying the inter-agency Development Budget Coordination Committee will still discuss it since members of the Committee have not had a meeting since the latest unemployment report came out last June 5.
“But definitely, the unemployment is a result of a drop in the GDP rather than the other way around,” he added.(with a report from PNA/PN)
