LowtoModerateEconomicGrowthforthePast40Years

ThemainreasonwhypovertyreductioninthecountryhasbeenslowcomparedwithotherAsiancountries(Table
29)isthefailureoftheeconomytogrowrapidlyandgeneratequalityemploymentinsectorswithlargenumbersof
thepoor.
RelativelyLowGrowthElasticityofPovertyReduction
ThePhilippineshasalsoperformedpoorlyinthefightagainstpovertyduringthelast25years.
ItisonlyinthePhilippinesthattheabsolutenumberofpoorpeopleincreasedfrom1990to2005
Recenteconomicgrowthhasbeenconfinedtoafewsectors,suchastheexportorientedsemiconductorindustry,
telecommunications,businessprocessoutsourcing,realestate,housing,andretailtrade.
Sectorsthatwillcreatemorejobshavealsonotbeenperformingwell:agriculture,manufacturing,andindustry
Hence,changesinpovertydependnotonlyontherateofeconomicgrowthbutalsoonthetypeofgrowth.
WeaknessinEmploymentGenerationandQualityofJobsGenerated
Thefailuretosustainahighlevelofeconomicgrowthalsoexplainstheunavailabilityofjobsinthecountry.
Withoutjobopportunities,peoplewillnotbeabletoearnincomesandarevulnerabletopoverty
DespitetheexodusofFilipinostoworkabroad,unemploymentratesremainhighbySoutheastAsianstandards.
Theshareofindustrialandmanufacturingemployment,whererelativelystableandhigherqualityjobsareusually
found,hasdeclinedovertheyears.
Theagriculturesectorsshareinemploymentalsofellsignificantly,from61.2%in1960to51.4%in1980anddown
to36.1%in2007.
Thisshowsthattherehasbeenalackofsustainableincomeopportunities,especiallyintheruralareaswheremostof
thepoorcanbefound.
Theyalsofoundthatthefastestgrowingjobtypeisnotpermanentwageemploymentbutcasualwagejobs,andthat
wagesandearningsgrowthisweakforworkersingeneral.
EpisodesofFoodInflationIncreasetheNumberofPoorPeople
Highinflationhasfurtherdampenedthepositiveimpactofeconomicgrowthonpoverty
FailuretoManagePopulationGrowth
PopulationgrowthremainsrapidbyAsianstandardsandhasdecreasedslowlycomparedtoothercountriesoverthe
lastthreedecades
HighandPersistentLevelsofInequality
IncomeInequality
InequitabledistributionofincomeanditspersistenceovertheyearsisanotherreasonforpovertyinthePhilippines.

Highlevelsofinequalitywererecordedforthepast2025years,whichinturnhaveweakenedthealready
moderateeconomicgrowth.
InequitableLandDistribution
ThePhilippineshasaskeweddistributionoflandholdings.Balisacan(1991)notedthatthepoorestinruralareas
tendtobelandlessfarmers,indicatingalinkbetweenaccesstolandresourcesandpovertyalleviation.
InterregionalandIntraregionalInequalityandtheLaborMarket
Inequalitycanbemostlyexplainedbythedisparityofspecificlabormarketindicatorswithin,notacross,regions.
RegularShocksandExposuretoRisksConflicts,NaturalDisasters,andEnvironmentalPoverty
LongRunningConflicts
Socialconflictspreventpeoplefrompursuingtheirlivelihoodsandeconomicactivitiesastheyaredisplacedfrom
theirhomesandplacesofwork.
NaturalDisastersandEnvironmentalPoverty
ThegeographiclocationofthePhilippinesmakesitsusceptibletonaturalhazardssuchasearthquakes,volcanic
eruptions,environmentaldegradation,tropicalcyclones,andflooding.