Gloria Macapagal-Arroyo

President of the Republic of the Philippines 2001 - 2010

Creating Jobs and Enterpreneurship

Key to the attainment of a life of sufficiency and abundance for all Filipinos is the creation of employment and self-employment opportunities for all citizens willing and able to take advantage of them. Towards that end, the Government laid down an agenda for employment and self-employment for our countrymen and countrywomen. The agenda was focused upon all members of the country's workforce, but it provided special measures for the poor and the disadvantaged as part of the national anti-poverty program. Beginning in 2008, measures for dealing with the adverse impacts of the international economic recession on the country's poor people were commenced.

I. Promoting Employment

A. Nation-wide Employment

Employment figures are difficult to compile, firstly because many entities creating them do not report them to the statistical authorities, and secondly, because the statistical system itself is handicapped by inharmonious definitions and delays in reporting, among other problems. The table below shows employment data over the period 2000-2009.

Source: National Statistical Coordination Board

The data is most likely biased toward large enterprises which are surveyed regularly by the authorities on the status of their work force. Medium-scale and small-scale enterprises, and most specially micro-enterprises—which are the focus of the Government's development program—would most likely be underrepresented for the reason already cited: that they seldom if at all report their employment status, and, further, that they are seldom reached by formal surveys. The proportionate inclusion of employment in these enterprises would, obviously, increase the numbers in the Table, perhaps significantly.

B. Pro-Poor Stimulus Package

The recession that began sweeping the world in 2008 not only extinguished jobs in advanced sectors of our economy but also imperiled the livelihood of those in the poorer sectors by undermining the general economy from which they derived sustenance. In a swift and energetic response to this emergency, the Government introduced a stimulus component in the national budget that, among other things, created the Comprehensive Livelihood Emergency Employment Program (CLEEP). The general objective of CLEEP was to protect the most vulnerable sectors from the consequences of reduced or lost income caused by the global economic crisis. Of specific concern in these sectors were the hungry, returning expatriates, workers in the export industry, the out-of-school youth, the lower middle class, and the poorest of the poor.

Pulis OYSTER

CLEEP had several components, each one of which had its own target to ensure that assistance reached intended beneficiaries: the Out-of-School-Youth Serving Towards Economic Recovery (OYSTER) Program – the out-of-school youth; the Green Collar Jobs Program – families in the uplands to plant trees and act as forest rangers; the Self-Employment Assistance Kaunlaran (SEA-K) Program – poor families to learn entrepreneurial skills from community-based organizations; the Financial Assistance and Microfinance for Expatriates (FAME) Program – overseas workers who had suddenly lost their jobs to receive financial assistance to start micro projects; the Grassroots Entrepreneurship and Employment in Tourism (GREET) Program – entrepreneurs in the tourism industry to help them overcome the slump in tourism; and the Nurses Assigned in Rural Areas (NARS) Program – unemployed nurses to be given training in primary health, school nutrition and maternal health programs, including first line diagnosis, water sanitation practices, health surveillance, and children and mother immunization from certain diseases, prior to their deployment in the rural areas. These programs made substantial contributions to job-creation in poor communities, especially those in rural areas.

II. Developing Entrepreneurship

Since 2001, the Government has made the development of entrepreneurship a major concern for generating employment alongside programs aimed specifically at employment creation. It thus directed special attention to the development of micro- and other small- and medium-scale enterprises which create jobs, not just for their initiators or owners, but for many other people as well. One special virtue of this program is that as it transforms MSMEs into successful operating entities, it reduces poverty and thus raises the effectiveness of the general anti-poverty thrust of government programs.

A. The Microfinancing Program

Microfinancing is a component of the entrepreneurial development program. Microfinance consists of collateral free financial products and services such as loans, deposits, payment services, money transfers and insurance products, extended to the poor and low income households for their use in starting up their own small businesses and, if successful in these, to build houses for their families. Target households included shopkeepers, ambulant vendors, and household-based entrepreneurs. By December 2009, the microfinance program had released a total of more than P160 billion to low income beneficiaries. Details are shown below:

Financial Literacy Program

To improve their chances of success in their undertakings, finance recipients were given training in the use of financial concepts in the planning and implementation of business operations. Delivered through a National Financial Literacy Program for the Poor (FLP) with the support of the Asian Development Bank, the training benefited many thousands of microfinance recipients.

Consumer Protection

Other than generating additional income and additional employment opportunities, the microfinance services ensured the protection of consumers. Seminars on consumer rights and obligations, including laws on the exchanges of goods and services, were thus given under the program.

Ugnayan Laban sa Kahirapan

Towards the same end, the microfinance program conducted orientations in poor communities to encourage the people to come together in cooperative or similar associations to maximize their ability to absorb the benefits accruing from the microfinance program.

Helping the Transport Sector

The microfinance program provided a special component for family members of drivers and conductors of public utility vehicles adversely affected by changes in the economic environment including increases in the price of oil. Under this special program, a total of P133.76 million was released to 25,145 beneficiaries. Another P9.30 million for the rehabilitation of typhoon-damaged vehicles was released to 190 beneficiaries.

Microfinance for Women

As many studies have shown, women are natural entrepreneurs, good in business, and experts in the handling of finances, particularly in the settlement of obligations. In recognition of these virtues the microfinance program opened a special window for women, to encourage them to engage in small- and medium-scale enterprises. A large number of women received assistance to start-up businesses under this program.

"It solves economic and social problems by developing entrepreneurs who likewise empower their marginalized neighbors by providing them jobs."

GRACE LAO Entrepreneur partner Talibon, Bohol

B. The GoNegosyo Program

Employment is not the only means by which people can gain sufficient income to support their everyday needs. Another means is entrepreneurship. First of all, it gives jobs and income to other people and not just the owner, but of great importance is it makes the Filipino worker his own "boss." To make entrepreneurship a centerpiece of the employment program, the Government established the Presidential Consultancy for Entrepreneurship (PCE) and appointed to its leadership a symbol of young Philippine entrepreneurship, Mr. Jose Ma. Concepcion III. The consultancy became what is now called GoNegosyo. GoNegosyo's main agenda is to change the passive mindset of the Filipino into a pro-active one, exploring ways to make the most of available resources and abilities for mobilization in practical business ventures.

Joey Concepcion

Today, GoNegosyo, through Mr. Concepcion's own Philippine Center for Excellence, is engaged in the tapping of mass media, the internet, and the Department of Trade and Industry to disseminate its message. Several thousands of people, young and not-so-old alike, have entered into business, and many thousands more are planning to do so as they receive information and encouragement from the program.

C. The SMED Plan

The SMED Plan expands the microfinance program by bringing into the ambit of the financial support program small- and-medium-scale enterprises. Together, micro-, small-, and medium-scale enterprises comprise 99.7 percent of business establishments in the country accounting for 70 percent of employment. The SME's Access to Finance (A2F) portfolio registered accomplishments that included:

Source: DTI

Other portfolios made their own contributions to the support for MSMEs: the Access to Market (A2M) portfolio provided advice on product marketing and promotions strategies; the Business and Investment Enabling Environment (BIEE) portfolio initiated measures for reducing and simplifying registration requirements and shortening the periods involved; and the Productivity and Efficiency (P&E) portfolio provided personnel training and business development and consultancy services to MSMEs.

D. One Town, One Project

OTOP

The One Town One Project (OTOP) program encouraged MSMEs to manufacture products from indigenous raw materials, utilizing locally available skills, adding products to the line of food and beverages, handicrafts, ready-to-wear apparel, furniture and souvenir items usually produced by MSMEs. Since its start in 2004, the OTOP project has exported products worth $563.82 million and sold locally products worth P13 billion and given employment to 382,899 individuals.

OTOP products can now be found in almost all areas of our country. The depot in Pasig City houses more than 1,000 OTOP products – including microwavable bananas, cream dory, and veggie noodles – from all regions nationwide. This depot sold 4.6 million products in 2009 alone.

III. Employment towards Reconciliation

Reconciliation with people who have turned their backs on the government is vital to the acceleration of growth of the national political economy. To achieve that end, the Government established the Subcontracting Partners on Innovations (SPIN) program. Under this program, rebel returnees were given a chance to resume normal productive lives in their communities. So far, the program has created 215 MSMEs, assisted 65 existing ones, and generated 4,065 jobs. These MSMEs have so far produced and sold products in the local market worth P6.75 million and in export markets amounting to US$16.51 million.